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Delayed Employment Allowance

Now being claimed on Moneysoft and backdates claim - is this/what is right ?

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I have one client where the Employment allowance was not claimed following the IACEW guidance whilst the x5 staff were on Furlough.

They have come back to work in July and so we have now claimed the EA but on the software it retrospectively applies the EA claim to months 1-3 where it was originally disclaimed and so it shows on the system that there is now an overpayment to HMRC in those months as the full amounts were paid including Ers NIC.

It means no payment due to HMRC for July as this overpayment is used but my query/concern/issue is that does this now mean that we have to repay the ERs NI we received under the CJRS or do we get to retain that benefit and then get the full £4k EA on top of that ?

I have read (Croner  Covid-19 pages) that maybe they should deduct the amount received under the CJRS from the EA being claimed (maybe I am misreading that but it was here halfway down https://www.cronertaxwise.com/community/coronavirus-covid-19-furloughed-employees/ )

Just want to make sure we get this right so any pointers greatly received as we dont want to overclaim 

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Replying to NH:
avatar
By Wanderer
18th Aug 2020 09:29

NH wrote:

1st June as we wanted it to apply to the payroll in the period to 5th June

That 'could' be the issue. An EPS submitted in the period 6 May to 5 June would probably be applied to the 6 April to 5 May payroll. I would have left it until after 5 June.
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Replying to Wanderer:
blue sheep
By NH
18th Aug 2020 09:34

That thought had crossed my mind, I dont really see why HMRC would do that but either way we shall see what happens when we claim EA for the rest of the clients this month

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Replying to NYB:
RLI
By lionofludesch
17th Aug 2020 18:42

NYB wrote:
It would be very unjust on those who have used the NIC EA & not claimed through CJRS which was the initial instructions.

Initial instructions ?

Were there any ? Or were there vague, unintelligible comments that could be taken either way ? "Unfair" would be reducing an employer's CJRS subsidy by £4000.

For what it's worth, as long as the employer pays £4000+ in secondary NI after July, I think you're grand.

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RLI
By lionofludesch
18th Aug 2020 12:11

"17 August 2020: HMRC confirms that employers can save their Employment Allowance for later and use it after the CJRS grant has ceased to be available"

https://www.icaew.com/insights/tax-news/2020/aug-2020/employment-allowan...

Can we just accept this now and move on ?

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Morph
By kevinringer
20th Aug 2020 14:49

Practical question: how do you submit a delayed EA claim to HMRC? You might think that EA would only apply to NI from the date of the claim onwards, but https://www.gov.uk/guidance/calculate-how-much-you-can-claim-using-the-c... says claims can be made up to 4 years after the end of the year and clearly no NI will be incurred after the end of the year, so claims submitted during those 4 years must be automatically backdated. But to when? And if post-year-end claims are automatically back dated wouldn't in-year claims also be backdated? If so, right back to the start of the year?

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Replying to kevinringer:
avatar
By Wanderer
20th Aug 2020 14:59

1. Delayed claim presumably via an EPS?
2. No, not backdated. Calculation is by reference to ERs NIC paid in the relevant year. Can be used to reduce other tax costs, e.g. current PAYE.

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