Coronavirus - payroll for furloughed employees

What will be the RTI reporting for furloughed employees in March and beyond?

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I have some clients who are running a restaurant. After the government announcement, they have to shut down the restaurant means all the employees have to furloughed or laid-off. Most of them receiving hourly pay, 25 to 35 hrs a week. Employers want them to keep on the payroll after Government 80% backing. What will be their RTI reporting in March?

Option 1 # They will receive the same hours and pay as they received in February and issued payslip as normal.

Option 2# They will grant leave of absence and paid the same amount of Gross pay without any hours.

Option 3# Any other idea?

Thanks in advance.

Replies (15)

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By SXGuy
22nd Mar 2020 08:49

No one knows.

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By paul.benny
22nd Mar 2020 08:55

In many cases, the details of support schemes haven't yet been published.
1) Check on gov.uk for the latest and most authoritative guidance
2) Subscribe to HMRC business help and support emails

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By Alwaysreading
22nd Mar 2020 14:05

From the limited detail available it also seems to suggest that employers don't have to make up the 20% difference. Not sure if this is correct or not?!

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Replying to Alwaysreading:
By James Green
22nd Mar 2020 20:54

It is correct: https://www.gov.uk/government/publications/guidance-to-employers-and-bus...

“To qualify for this scheme, you should not undertake work for them while you are furloughed. This will allow your employer to claim a grant of up to 80% of your wage for all employment costs, up to a cap of £2,500 per month.

You will remain employed while furloughed. Your employer could choose to fund the differences between this payment and your salary, but does not have to.“

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Replying to James Green:
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By AshleafAccountancy
23rd Mar 2020 12:13

So would you put their full (100%) wage through payroll, employer could choose to only pay 80% and leave the remaining 20% in "wages payable" for now??

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Replying to AshleafAccountancy:
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By fawltybasil2575
23rd Mar 2020 12:33

If the employer decides to pay the employee only the "80%", then the pay for that employee should be entered in the payroll software as that "80%% figure.

Basil.

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By 0098087
27th Mar 2020 09:24

FROM HMRC:

How your monthly earnings are calculated

If you’ve been employed (or engaged by an employment business in the case of agency workers) for a full year, employers will claim for the higher of either:

the amount you earned in the same month last year
an average of your monthly earnings from the last year

If you’ve been employed for less than a year, employers will claim for an average of your monthly earnings since you started work. The same arrangements apply if your monthly pay varies such as if you are on a zero-hour contract.

If you started work in February 2020, your employer will pro-rata your earnings from that month.

Bonuses, commissions and fees are not included as part of your monthly earnings.

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By rememberscarborough
27th Mar 2020 09:46

Hope the minimum wage people are up to speed because if the RTI is showing a rate below minimum wage it possible their computers will flag it up and start sending nasty letters automatically regardless of the actual situation.

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By Kate Upcraft
27th Mar 2020 09:50

if they are furloughed then NMW does not apply. Remember RTI reporting is separate from the reclaim. You pay and report whatever contractually you have agreed with employees both furloughed and non-furloughed and then around 21st April the reclaim portal will open and you will ask for a reimbursement of the furlough costs

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Replying to bassett1:
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By 0098087
27th Mar 2020 10:11

Please tell me we can do this through our payroll software because if they are going to want hmrc logins..that won't happen. Most clients don't have one and have no interest

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By Lauren.Hawkes
27th Mar 2020 10:13

Can I assume that anyone who is paid monthly and did any work for a company in March, cannot be furloughed for this month? Further to James Green and the HMR&C link below?

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Replying to Lauren.Hawkes:
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By facucvivas
27th Mar 2020 10:27

Lauren.Hawkes wrote:

Can I assume that anyone who is paid monthly and did any work for a company in March, cannot be furloughed for this month? Further to James Green and the HMR&C link below?

where's the link

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Replying to Lauren.Hawkes:
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By Philipbwood
27th Mar 2020 12:48

No, they can be furloughed from whenever in the month they cease to work, but as I understand it must then remain furloughed for at least three weeks

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By Southbankdelboy
27th Mar 2020 10:46

Deleted

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By IrwinSchiff
30th Mar 2020 17:00

How is 'pay' worked out in this context? If a Director of a company had been putting a minimal salary through the company and paying the rest in dividends, can the dividends be included with the PAYE salary in the calculation of of the 80% up to the £2500 max or are dividends totally excluded? Lots of people will be in this situation.

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