Job Retention Scheme

Latest updates:
29/05/2020 
Chancellor announces further details on the extension of the scheme, and the amounts of government support  
​Are there any restrictions on this second phase of the scheme? 
Plus updates to a number of the other questions and answers, including: 
How much must the employee be paid in July to October, and how much will it cost the employer? (updated)
27/05/2020
Further Treasury Direction made under Sections 71 and 76 of the Coronavirus Act 2020
22/05/2020
HMRC Calculator to assist in working out how much can be claimed
Can I make a deduction from my employee’s salary if they are on furlough

On 29 May the Chancellor announced further details on the extension of the Job Retention Scheme, which offers additional flexibility in working arrangements from 1 July 2020, and a tapered reduction in government support from 1 August 2020. Further details are set out below and in the government’s factsheet. We will update these pages when more detailed guidance becomes available.

HMRC has published on GOV.UK guidance for employees and employers on the Job Retention Scheme. This guidance has been updated a number of times, with the latest version published on 21 May. It includes detailed guidance around which employees and employers are eligible for the scheme, how much can be claimed and what information will be required to make a claim. It also includes guidance on how and when to report payments to HMRC made to employees under the Scheme using the PAYE RTI system, which employees you can put on furlough, and examples of how to work out 80% of your employees' wages, NI and pension contributions.”.

HMRC has also published detailed guidance on how to calculate the claim and a step by step guide for employers. A calculator is also available to assist in working out how much can be claimed, and can help calculate the claim for most employees who are paid either regular or variable amounts each pay period, even if you top up their pay or make discretionary payments.

On 11 May HMRC shared an update, confirming that a save and retrieve function has been added to the CJRS, as well as providing guidance to avoid some of the more common mistakes.

HMRC has also published some information for agents to explain who is authorised to submit the claim, and how to become authorised if not authorised already.

The Cabinet Office has published guidance for public sector contractors, in particular payments to suppliers for contingency workers impacted by COVID-19.

HMRC has sent a letter to agents in relation to the Coronavirus Job Retention Scheme. This can be found in our Technical News section.

On 15 April 2020 the Chancellor made a Treasury Direction under Sections 71 and 76 of the Coronavirus Act 2020, which sets out that HMRC are responsible for the payment and management of amounts to be paid under the Coronavirus Job Retention Scheme, as set out in the Schedule to the Direction, and the legal framework for the Scheme. This Treasury Direction was replaced on 20 May 2020 by a further Treasury Direction clarifying some provisions within the original Direction and to reflect the extension of the current scheme until 30 June 2020.

Tarlochan Lall, Barrister, Monckton Chambers, considers the scheme’s features and associated legal issues in this article.

Regulations have been laid to prevent an employee from experiencing disadvantage in relation to family-related statutory payments and Maternity Allowance as a result of their being placed on temporary leave under the Coronavirus Job Retention Scheme. More information can be found here.

Query Status / response
Can agents make claims on behalf of their clients?
Agents that are authorised to act on behalf of clients for PAYE matters, will be able to claim. However, file only agents, including Payroll Bureaus, will not be able access the service due to data protection reasons. See HMRC letter to agents
Will HMRC be able to cope?
HMRC has around 2,000 helpline staff that it will redeploy onto this scheme a further 3,500 staff that it can redeploy from other work, supplemented by their third party providers. The system has currently been tested up to 450,000 claim per hour and be available 24/7.
Can I furlough staff regularly, but have them working one week a month in order to carry out essential tasks?
Subject to any employment law issues, yes. An employee must be furloughed for a minimum of three consecutive weeks, but can be furloughed again after having a week back at work. From 1 July, employers will have maximum flexibility to bring employees back to work and the three week minimum furlough period will not apply.
How long will it take for claims to be paid?
It will take around six working days for claims to be paid. 
How long will the scheme run for?
The scheme will run in its current form until the end of June. From July, employers currently using the scheme will have more flexibility to bring their furloughed employees back to work part time whilst still receiving support from the scheme. The scheme will then run for a further three months from August through to the end of October, albeit with reduced levels of government support (see below).
How much must the employee be paid in July to October, and how much will it cost the employer?
The employee must receive at least 80% of their salary whilst on furlough, so in September and October, when the amount of government support in relation to the employee’s wages reduces, the employer must top up by at least 10% and 20% respectively.
In July to October the amounts of government support per employee are as follows:
July - 80% of wages up to a cap of £2,500, PLUS Er NICs, PLUS pension contributions
August - 80% of wages up to a cap of £2,500. NO Er NICs or pension will be reimbursed.
September - 70% of wages up to a cap of £2,190. NO Er NICs or pension will be reimbursed.
October - 60% of wages up to a cap of £1,875. NO Er NICs or pension will be reimbursed.
The claim process requires a Corporation Tax Unique Taxpayer Reference, Self-Assessment Unique Taxpayer Reference or Company Registration Number. What do I input if I don’t have these?
Answer ‘no’ to the following questions:
  • Does the employer submit a company tax return (No)
  • Is the employer registered for self-assessment (No)
  • Is the employer registered at companies house (No)
Then when asked:
What is the name of the employer?
Enter the name of the organisation or individual employer.
If problems persist please let us know at technical [at] ciot.org.uk.  
Can I amend or correct a previous claim?
At the moment no, but we understand that functionality is being developed to allow this in future.
What do I do if I do not hold every employee’s National Insurance Number?
HMRC has provided us with specific guidance in relation to these circumstances.
What about annually paid directors and other employees who are paid in March each year.
In order to qualify for the CJRS a director or employee must have been notified to HMRC on a real-time information (RTI) submission on or before 19 March 2020, AND which relates to a payment of earnings in the 2019/20 tax year. If the last RTI submission before 19 March 2020 was in relation to the 2018/19 tax year then the individual will not qualify. See ‘Company directors with an annual pay period’ on GOV.UK.  
What is a ‘claim period’ for my CJRS claim?
Guidance on claim periods can be found under the heading 'Deciding the length of your claim period' on GOV.UK and also under the link ‘What is a claim period?’ on the GOV.UK calculator
What records must I retain, and for how long?
You must keep a copy of all relevant records for 6 years, including:
  • the amount claimed and claim period for each employee
  • the claim reference number for your records
  • your calculations in case HMRC need more information about your claim
We have asked HMRC to confirm if any further records need to be retained.
Can I make a deduction from my employee’s salary if they are on furlough.
There are very strict rules around what can be deducted from an employee’s salary when they are on furlough. See GOV.UK. However, employee authorised salary deductions can now be made from grant payments, such as if the employee’s furlough pay has previously been calculated incorrectly and the employee has agreed to refund the overpayment to the employer.
Are there any restrictions on this second phase of the scheme?
Yes, these include:
  • Only employers who have furloughed employees for a full three week period prior to 30 June will be able to make a claim under the second phase. Claims for this period must be made by 31 July.
  • Only employees who have been previously furloughed on or before 10 June will be covered by the second phase of the scheme.
  • Employers will need to provide details of hours usually and actually worked when making a claim under the scheme.
  • The number of employees an employer can claim for in any claim period cannot exceed the maximum number they have claimed for under any previous claim under the current CJRS.