I have spotted what could be a sneaky change in the rules, or possibly an error in the HMRC calculator, not sure which.

The calculation used to be that the average would be on the number of days up until you start furlough if that was before 5 April. But, the calculator seems to be going to the later date - I have highlighted in bold italics. Any thoughts?

See my cut and paste skills below:

Breakdown of calculations

PER THE CALCULATOR

You told us this employee gets paid a variable amount each time and has worked for you for less than 12 months. We’ve worked out their average daily earnings in the last tax year, by dividing their total pay by the number of calendar days between 6 April 2019 and the day before furlough (** or 5 April 2020 if later**). Then we’ve multiplied that by the number of furlough days and furlough hours in each pay period. The furlough grant is 80% of this.

There’s a maximum amount you can claim. If this affects your claim, we’ve adjusted the calculations. Work out the maximum wage amount you can claim (opens in new tab).

Calculations are rounded to the nearest penny unless otherwise stated.

OR PER GUIDANCE NOTES

To work out 80% of the average monthly wages for tax year 2019 to 2020:

Start with the amount of wages that were payable to the employee in the tax year up to the day before they were first furloughed.

Divide it by the number of days from the start of the tax year – including non-working days (** up to the day before they were first furloughed, or 5 April 2020 – whichever is earlier**).

Multiply by the number of furlough days in this pay period.

Multiply by 80%.

## Replies (9)

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I never got to grips with this day business. I am sure none of my calculations are squeaky clean. Not with loads of clients with many employees. And let me tell you - my ZERO hours employer - one of the biggest travel companies - has just averaged mine in the simplistic common sense way. Add it up. Divide it out. X 80%.

You are not alone. No - one has got a grip on this. Not HMG, not HMRC, not the accountancy profession, not even The Donald (see another post).

Chances of you being wrong and 'prosecuted'?

Nil, I would say.

Me neither. If HMRC aren't satisfied with my calculations they can come and do them themselves.

I love that answer!

I think they mean, or 5 April if the day before furlough is later (but not very clear!) but otherwise it would not make sense.

The guidance is the correct version. You never include a period of furlough in the calculation of the normal pay, because this would be an 80% value and you'd effectively be calculating 80% of 80% if you did.

Agreed, it's just a huge concern that the calculator is working it out differently to the guidance.

They have changed the calculations: I only looked at the fixed rate example yesterday and now they are dividing by 30 ( in November) multiple by the number of day in furlough period.

for example: £2000 / 30 X 30 ( if full month on furlough in November) = £2000

it used to be:

Fixed monthly pay x 12 / 365.14 x number of days in furlough period.

For example £2000 x 12 /365.14 * 30 ( if full month in November) = £1971.85

Or am I loosing the plot like everybody else???

Maybe its bringing into line with Flexi Furlough because that is all based on days of the month.

Thats only a thought. To be qiuie honest I go with what I go with,