Info - Director's annual PAYE scheme

HMRC have processed furlough claim over the phone

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Online chat with HMRC last week questioning claim for director, with an annual scheme, which was processed after 19th March. Had phone call back this morning and claim was processed over the phone. HMRC said they are having to use a work around for the annual schemes and future claims for the client may also have to be dealt with over the phone.

Maybe we were just lucky on this occassion................

 

   

Replies (23)

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By philaccountant
27th Apr 2020 14:02

Thanks for this update. Very interesting.

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By andrew1211
27th Apr 2020 14:13

Following...

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By meadowsaw227
28th Apr 2020 10:40

I may be missing something but can not see the benefit of Directors annual paye scheme, therefore I do not have any ? .

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Replying to meadowsaw227:
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By andrew1211
28th Apr 2020 10:51

Just you then....

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Replying to andrew1211:
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By Cheshire
28th Apr 2020 11:11

All mine are on monthly, so not quite.

Diversity

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Replying to Cheshire:
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By Paul Crowley
30th Jun 2020 18:51

Me as well

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By I'msorryIhaven'taclue
28th Apr 2020 12:13

Thanks Heidi; was your annually-paid director on the payroll for the entire 2019-20 year please?

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Replying to I'msorryIhaven'taclue:
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By Heidi Roffe
28th Apr 2020 12:18

No - just since November

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By Wanderer
29th Apr 2020 08:08

In November was your director actually paid something?

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Replying to Wanderer:
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By Heidi Roffe
29th Apr 2020 09:07

No - registered as an annual scheme on PAYE set up last year. First RTI for Nov 2019 to March 2020 salary submitted after 19th March.

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Replying to Heidi Roffe:
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By Wanderer
29th Apr 2020 09:37

Okay, you were lucky then!
In your situation I'd probably inform the client that whilst the claim has been accepted by HMRC it wasn't strictly in accordance with the regulations.

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By Gone Sailing
29th Apr 2020 14:15

Does this open the window for (£719 x 11) + (£4,591 x 1)?
Claim £12,500 / 12 @ 80% pro rata days in month?

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Replying to Gone Sailing:
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By Wanderer
29th Apr 2020 15:15

Probably the very reason the regulations are written as they are.

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Replying to Wanderer:
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By Gone Sailing
29th Apr 2020 16:00

I infer you mean "no", which I understand, but it's not massively different from annual payments (ie. it's a year end decision) and if it was consistent with previous years, would be my point.

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Replying to Gone Sailing:
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By Wanderer
29th Apr 2020 16:12

Yes, I mean 'no'.

I do agree with your point. It's just that it would provide further windows for opportunism, and also make the calculations even more unwieldy than they already are.

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Replying to Wanderer:
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By Gone Sailing
29th Apr 2020 17:47

I have followed various comments on averaging ....
This then is a brave comment ...

"How will this operate for employees on variable pay, Zero hours or flexible contracts?
​HMRC have confirmed that for employees on zero hours/flexible contracts:
If they have been employed for longer than 12 months, it is the higher of the average monthly earnings for 2019/20, or their earnings from the same month the previous year. If they have been employed for less than 12 months, it is the average of their monthly earnings since they started."

No mention of 19th March cut off or before the period of furlough began.

https://www.mazars.co.uk/Home/Services/COVID-19-Your-Business/Covid-19-C...

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Replying to Gone Sailing:
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By Wanderer
29th Apr 2020 17:51

Agreed but they didn't reference when they made / put up that page. It could have been pre 15 April.
Also you'd think they'd know better than all that 'HMRC has confirmed' and 'HMRC has changed the reference date' stuff. None of this is within the gift of HMRC to confirm or change. Section 76 of the Coronavirus Act 2020 is quite clear, HMRC do what they are told!

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By gillybean04
29th Apr 2020 17:06

I'd hold off the celebrations until the claim is paid - and even then I'd retain some caution in case they came asking for it back later.

Of course, if the treasury change the rules then that would ease my doubts.

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By gillybean04
01st May 2020 15:50

Looks like they have finally updated the guidance with regards to annually paid directors. Did your client receive payment Heidi? You may want to advise them of the update and that HMRC may not pay/may ask for any funds received to be repaid.

Company directors with an annual pay period
Those paid annually are eligible to claim, as long as they meet the relevant conditions. This includes being notified to HMRC on an RTI submission on or before 19 March 2020, which relates to a payment of earnings in the 19/20 tax year. The requirement for there to be payment of earnings in the 19/20 tax year applies for any employee being claimed for under the scheme, irrespective of how frequently they are paid (e.g. weekly, fortnightly or monthly). This will be relevant for those on an annual pay period if the last payment notified to RTI was before 5 April 2019 and no further payments were notified until after 19 March 2020.

An employer can make their claim in anticipation of an imminent payroll run, at the point they run their payroll or after they have run their payroll.

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Replying to gillybean04:
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By andrew1211
02nd May 2020 10:28

Confirming what we probably already knew, but at least it is now in black and white.

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Replying to andrew1211:
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By philaccountant
04th May 2020 11:39

Indeed. Ridiculous and arbitrary though. This is going to mean many of our clients will go back to work early and risk infection as they need the money. If the goal of these schemes and measures is to protect public health then this is an unhelpful response from the government.

I can understand the need to stop people gaming the system, but we are making submissions completely in line with previous years' RTI submissions and some of these schemes have been in existence for at least a decade. No sudden jumps to £30,000/annum for one month!

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By Paul Crowley
01st Jul 2020 05:38

Any update?
Did they get and keep grant?
Any subsequent successful claim?

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Replying to Paul Crowley:
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By Heidi Roffe
01st Jul 2020 06:19

No subsequent claim - returned to work in May.
Have warned client that HMRC may ask for the funds back in time. It was only around £700.

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