Can I increase furlough pay for the new tax year?

If my company tax year is after 28 Feb 2020, can I increase furlough pay to the max £2500?

Didn't find your answer?

I have claimed furlough pay at £1000 per month for March for my company, as that is what was going through PAYE for Feb 2020.

However, my company tax year is end of April, so from 1st May I am in new company tax year. Can I increase my salary for the new tax year to the max £2500 and thereby increaase the furlough payment due back from the government?

Many thanks in advance.

Replies (23)

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By pauld
19th May 2020 13:50

yes why not. I would increase it to £3,125 as 80% is then the max £2,500. Wish I thought of that but have already done my claim for this month. Thanks for the tip.

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Replying to pauld:
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By SXGuy
19th May 2020 13:51

Hope that's sarcasm

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By SXGuy
19th May 2020 13:53

What you should have claimed in March was 80% of your wage if that's 1000 fine. If it isn't. You've over claimed.

No you can't increase the amount you claim. You can only increase the amount you pay yourself the difference by.

BTW, company year end has sweet f a to do with payroll tax years.

Sounds like you need an accountant.

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Replying to SXGuy:
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By IrwinSchiff
19th May 2020 14:43

I have an accountant, but they are not the type to proactively suggest this.
I have not overclaimed, they have claimed the £800.
You have not explained why I can't increase it.

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Replying to IrwinSchiff:
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By Cheshire
19th May 2020 14:48

Why do you think you cannot increase the furlough claim.

Think about the millions who have applied? What happens when they also do what you are suggesting?

If you really want to know, ring your Accountant who can tell you to stop trying to defraud the nation.

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Replying to Cheshire:
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By IrwinSchiff
19th May 2020 19:38

I have reported your comment. Accusing me of trying to commit fraud is not ok.

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Replying to IrwinSchiff:
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By Matrix
19th May 2020 19:58

OK well I will say it then. Claiming any more than £800 a month in a claim under the CJRS would be fraud.

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Replying to IrwinSchiff:
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By Cheshire
19th May 2020 21:40

Hilarious, I needed a giggle

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Replying to IrwinSchiff:
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By insolventnl
19th May 2020 15:04

With all due respect i think you either should have faith on your accountant or change to another one.
They are not proactively suggesting this, have you thought there may be a reason?

Have you tried asking your accountant the reason?

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Replying to IrwinSchiff:
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By SXGuy
19th May 2020 17:09

I didn't say you cant increase your salary I said you can't claim more than the 80% you claimed in March.

If you want me to explain why. It's quite simple. It's called the basis period for calculating the claim. If you are unsure what basis period means I suggest you either ask your accountant or actually read the rules.

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By paul.benny
19th May 2020 13:51

No

It's nothing to do with your company's accounting period. The rules clearly state the basis periods for calculation for JRS claims. What you are proposing would be a blatant attempt to manipulate the scheme.

Incidentally, if you were paying a salary of £1000/month, your claim should only be £800 plus NI - ie 80% of prior pay.

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Replying to paul.benny:
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By IrwinSchiff
19th May 2020 14:38

I am aware that the claim is only 80% of the salary amount.
It is not 'manipulating' the scheme. What my company pays me in a tax year is a company decision.

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Replying to IrwinSchiff:
JCACE
By jcace
19th May 2020 14:44

You are correct when you say that whatyour company pays you is a company decision. Your company is at liberty to pay you what it deems fit and proper.
However, you are limited as to how much you can reclaim under the job retention scheme. That will be based on your February salary (probably) if you are a fixed rate employee, or the average to then if your pay was variable. Any changes to your pay now will not have any impact on the amount you can legitimately claim under the scheme.

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Replying to IrwinSchiff:
Psycho
By Wilson Philips
19th May 2020 20:30

IrwinSchiff wrote:
What my company pays me in a tax year is a company decision.

And what HMRC pay your company under JRS is a Treasury decision which, as others have said, has absolutely nothing to do with your company's year-end.
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By Duggimon
19th May 2020 13:53

If you're making your own furlough claims I would highly recommend reading the rules of the scheme first, lest you make an erse of it all.

pauld's facetious comment aside, you very obviously cannot do what you're suggesting, or every company in the UK would have raised everyone's wages to where £3,125 is the new minimum.

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Replying to Duggimon:
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By IrwinSchiff
19th May 2020 14:40

My understanding is the max gross pay is £2500, that is not the max furlough pay.
Also, not every company can just arbitrarily do this, as what I am proposing is based on a new tax year.

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Replying to IrwinSchiff:
By Duggimon
19th May 2020 14:50

The new tax year is irrelevant.

You are wrong about the gross pay.

If you had taken my first suggestion and just read the rules, you would already be aware of this. Your claim is based on your February salary, or, if you are paid variable amounts, your average over the last year, or your pay from the same period last year.

It is not based on what you arbitrarily decide to pay yourself now. In PAYE terms, everyone had a new tax year start on 6 April, your company's reporting date is entirely irrelevant, the fact it's a new tax year is irrelevant, and the rules are written plainly enough that this is obvious to anyone who has read them.

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Replying to IrwinSchiff:
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By Tax Dragon
19th May 2020 14:54

I admire your brass.

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By Matrix
19th May 2020 14:10

Yes of course you can increase your pay. The payroll and the furlough claim are completely separate. Under the rules your claim is restricted to 80% of February pay. Your idea occurred to most of us on 20 March but sadly doesn’t work.

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Replying to Matrix:
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By IrwinSchiff
20th May 2020 09:10

You mean you were thinking of defrauding the nation?

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Replying to IrwinSchiff:
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By Matrix
20th May 2020 09:25

We didn't know the rules on 20 March. If they had not been prescriptive about using February pay then it may have been possible to increase subsequent pay to maximise a claim - this may have been legal even if is was not moral. However we now know it is not possible so would not advise our clients to claim any more than the rules permit. We plan around the rules every day within the law and I am sure your accountant does too.

If you do not agree with the rules for limited company business owners then check out the petition by Forgotten Ltd.

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By Wanderer
19th May 2020 15:16

IrwinSchiff wrote:
Can I increase furlough pay for the new tax year?
If my company tax year is after 28 Feb 2020, can I increase furlough pay to the max £2500?

I have claimed furlough pay at £1000 per month for March for my company, as that is what was going through PAYE for Feb 2020.

However, my company tax year is end of April, so from 1st May I am in new company tax year. Can I increase my salary for the new tax year to the max £2500 and thereby increaase the furlough payment due back from the government?

Many thanks in advance.

Brilliant! Gotta be a wind up.
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By pauld
19th May 2020 15:44

Yes I think I am going for wind up too, and a good one at that, would be proud of it myself.

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