In The News
Article Date: 15 June 2020
Coronavirus Guidance 15th June 2020
After the 5pm watershed on Friday 12th June, HMRC published a raft of information about the Covidvirus Job Retention Scheme.
For completeness, the publications updated or newly issued by HMRC are set out below.
At the beginning of the lockdown there was sense that most of what was being published was made up as it was going on and that the gaps in the details were too wide to make interpretation difficult.
These documents are more like the detailed notes one expects from HMRC and therefore I shall not attempt to summarise or re-write what has been written.
However, some interesting observations are made and highlighted so you can try to make better sense when you read all of the information.
This document sets out the “flexible furlough” concept from 1 July 2020 incorporating the ability to furlough for short period (as opposed to a minimum of 3 weeks) and the contributions required from an employer from 1 August 2020.
This document highlights a few important concepts relating to furlough post 30 June 2020.
During furlough an employee cannot work for the employer but can take part in training of any kind
This guidance sets out which employees can be furloughed and incorporates reference to SSP, employees returning from maternity and paternity, annual and unpaid leave.
It also discusses agency workers (subject to IR35), payroll consolidation and employees transfers under TUPE.
This document is in that it highlights three important furlough issues;
This document incorporates the HMRC calculator that you choose to use to check your own payroll results for each employee
“Examples of how to calculate your employees' wages, National Insurance contributions and pension contributions”
This document sets out many helpful examples;
“Example of how to calculate the amount you should claim for an employee who is flexibly furloughed“
This document sets out an example but whilst helpful, there is little doubt that this process looks to be fraught with difficulty and even more complex than furlough claims to date.
This document sets out what you need to claim and how to claim.
It states that 31 July is the last date that an employer can claim for periods on or ending 30 June 2020.
It also invites disclosure of errors and how the employer can make an adjustment for errors.
It states that you can note an error / over claim when making a subsequent claim. If no more claims are to be made in future, the guidance states that HMRC are working on a process as to how an employer can repay over claims.
This document highlights the need to an employer to make normal PAYE submissions on time and to pay the PAYE, employers NIC, pension contribution and employees’ wages on the due dates.
A few final thoughts
It is very difficult not to appreciate the level of support offered by H M Government to businesses and to employees during this crisis. The financial burden upon H M Treasury is substantial and will be a bill that will take many years to repay.
Whilst most commentators agree that at some point in time, H M Government is right to reduce the support to businesses, I do not think that any commentator knows precisely the date when support should cease. Moreover, whilst most commentators are able to understand and appreciate the theory and basis of the new proposals, whether the new set of proposals are likely more right than they are wrong only time will tell.
Whatever the facts determine in future to have been right or wrong, these measures continue to be welcome.
However, business and society may need to reflect again upon what has been done and whether it can be repeated if a further COVID spike were to occur in the winter to come. The economy is already seeing the gentle ripple of redundancies as businesses try to redraw their business plans to adjust for what has already happened; a further spike and a second lockdown maybe a step too far for many businesses and the furloughing of employees for a second time maybe a cost too great for any government.
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