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Furlough Claim involving 'associated' businesses

May have made an incorrect furlough claim by accident.

Didn't find your answer?

I'm wondering if we have made a furlough claim, in good faith, that is actually incorrect.  Please could someone confirm if that's correct and what we need to do.

My husband and I have three businesses - they are completely unconnected in that they all do very different things.  Two share a building - one upstairs and one downstairs, but apart from that, and us, they are completely independent of each other. 

I own Co A, hubby owns Co B, we jointly own (50/50) Co C.  We are both directors of all three.

To cut a long story short(er).  Co A has continued to operate in a limited capacity.  It has 4 people on payroll including both of us.  We furloughed hubby and 1 other member of staff and claimed JRS for them (no claim for me or the other member of staff as we kept working).  Co B could not operate at all due to the nature of it's work.  We are both on payroll (no other employees), and furloughed and claimed for us both.  Co C has also continued to operate - it had not previously run a payroll as we did not draw anything for the first year but it was always going to pay us a director fee from April this year.  So we set up the payroll as planned and put through a director fee for hubby only (haven't put me on yet as it's work is still lower than we would expect, and only paid hubby from June as it took ages for the scheme to be set up).

I'm now wondering if we shouldn't have claimed for us at all as the companies are connected/linked and we have both continued to do work for at least one of them.  Hubby hasn't actually been paid the payroll from Co C due to cashflow - would I be better submitting an amendment with no payment for him for June, then we could at least claim for him, or would the fact that he has worked for Co C, even though he hasn't earned anything, still mean we can't claim for him at all either?

It would seem harsh, as our businesses have been really hard hit, but I'm assuming they are all connected and I think that might mean that we shouldn't have claimed. I've looked at the HMRC guidance and I can't see where it defines "a company linked or associated to the employer".  The companies aren't linked in what they do at all, but are they linked/associated by us?  Any help would be gratefully appreciated as I'm in a bit of a panic, and even though it isn't much, I have  no idea how we are going to afford to repay the JTS money.  Thanks.

Replies (10)

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By gillybean04
25th Jun 2020 11:37

Check the Treasury Direction under paragraphs 6.2 & 13.4

https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

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Replying to gillybean04:
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By Wanderer
25th Jun 2020 11:41

Or maybe check the current Treasury Direction:-

https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

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Replying to Wanderer:
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By gillybean04
25th Jun 2020 11:49

Quote:

Or maybe check the current Treasury Direction:-

https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

Sorry, I don't have the new one bookmarked on my phone and didn't see the harm given the paragraphs I've referenced are identical in both.

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By Paul Crowley
25th Jun 2020 11:59

Do not really think HMRC planned for this level of detail. The penalty system is on its way but, but this all new territory.
Get out of jail card is to put details in writing to HMRC recorded.

Calls and webchats very difficult to rely upon, and to expect accurate answer fom HMRC telephone bods is unrealistic

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By Mr_awol
25th Jun 2020 13:14

Dear 'Anonymous',

I hope you are having a truly spiffing day, and thankyou ever so much for coming to the forum. Let me be the first to extend a warm and friendly virtual cuddle to you. We all like to #BeKind here. Or is it have to. I'll get back to you on that one.

I assume you run your own payroll and made your own furlough claim because you didn't want to incur the unnecessary cost of a professional advisor - or perhaps you do have one already, but don't want them to charge you for extra work when you can get advice for free online. A wise move, I must say! Please make sure you keep coming back regularly to avoid similarly unnecessary costs from those pesky accountants trying to earn a living - or, to use popular phrases, to 'check what your accountant has told you' or 'research issues before speaking to your accountant so you know in advance what they should be advising you'.

Oh and if any of my assumptions are incorrect, please don't take offense - id hate for anyone to get upset given that John says the forum is for everyone, including freeloading members of the public and "always has been". This does of course ignore the fact that the headers and signup process clearly state otherwise, but John says we are wrong about that so he must be right. Oops, sorry. a bit of negativity crept in there. Darn it. Bear with us and #BeKind, since we are all learning this newly longstanding system.

Don't worry if you cant repay the JRS money. There are two options there:
1) You could report HMRC to John, who will tell them to #BeKind, point out to them that demanding people take responsibility for their errors is unprofessional, remind them that their role has always been to give money to people who made a mistake whilst trying to DIY on the cheap, and get them to waive the repayment.
2) Just pop on here and explain the position. We can all tap our feet at the injustice of it all and perhaps have a whip-round for you.

I really hope this helps.

Finally, if you've got the answer you want - and especially if you got an answer you didn't like, it's common practice to delete your post, replacing it with a dot where necessary. On the way out you could always throw a load of insults at long standing members who may have given you good advice (even if you didn't like it). This isn't strictly in accordance with the new(ish) #BeKind direction that AnyAnswers should always (now) have taken, but it seems that #BeKind only works one way. The most important thing here is increased traffic of new readers. Us longstanding regulars are no good to anyone but don't worry, Sift are trying their best to remove us.

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Replying to Mr_awol:
By SteveHa
25th Jun 2020 13:40

Oh dear. BUT, the most polite F* off I've ever seen.

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Replying to Mr_awol:
JCACE
By jcace
25th Jun 2020 13:42

An unneccessarily harsh response to the OP, whose only "crime" has been to post anonymously. Your frustration and anger clearly shouldn't be vented towards her, and does nothing to raise the profile and standing of professional accountants trying to earn a living.

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Replying to Mr_awol:
By SteveHa
25th Jun 2020 13:46

Oooh, ooh. I thought of a film quote to go with it.

"leave the kid alone"......

Answers on a postcard.

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Replying to Mr_awol:
By ireallyshouldknowthisbut
25th Jun 2020 14:35

@Mr Awol. Funny yes. Appropriate, no.

Give John a break!

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By Matrix
25th Jun 2020 13:22

I would discuss with your accountant who knows all the facts about your businesses. How have you treated the businesses to date with regards to the NI thresholds (for your husband) and the employment allowance?

I don’t really understand why you are so worried if the employees were on the payroll in March, have been furloughed and aren’t working. Reread the rules and take advice if necessary, giving all the facts.

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