Owner Kate Upcraft Consultancy Ltd
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Coronavirus: CJRS claim service for furloughed employees is live

The coronavirus job retention scheme (CJRS) claims service is open, but payroll managers and tax agents need to revisit their furloughed salary calculations after amended guidance was released on 17 April. 

20th Apr 2020
Owner Kate Upcraft Consultancy Ltd
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The CJRS claim guidance was published on 17 April in two different formats:

  1. The red cover guidance as PDF
  2.  Online on gov.uk

The CJRS claim calculator was made available on 20 April, and on 23 April it was updated so it caters for ‘fixed rate’ employees and those on variable levels of pay. It also appears to work out four-weekly pay incorrectly based on the calendar days in the month, not on 28 days.

Calendar days vs working days

When the software developers’ guidance was published in draft, it was clear that the claim for employees’ furloughed pay was to be calculated based on calendar days, whereas many employers contractually pay on working days (260/261 days pa). As no mention had been made in five versions of the CJRS guidance that this would be the basis for the formula, many employers simply worked out the part-period furlough amount for March (and for April for those who already run April payrolls) using their contractual payroll formulas.

Now payroll managers have reviewed the calculation guidance they will find they can claim less pay than they had paid out. It’s not a huge amount per employee. But as the guidance was used to make strategic financial decisions on how much an employer could afford in top-up pay and who could be working and not furloughed, for a large payroll this can soon start to add up.

NI and pension pro-rating

Those of us who had spreadsheets prepared in respect of the employer’s national insurance and pension contributions in the CJRS claim were pleasantly surprised by the new guidance on Friday 17 April. It became clear that we were going to be able to pro-rate both the NI and pension thresholds to allow some recovery for those with part-furlough payments below the relevant thresholds for 2019/20 and 2020/21 (£719/£732 national insurance and £512/£520 pensions). Over the weekend we amended our spreadsheets following the printed guidance from 17 April.

Imagine our surprise on 20 April when the CJRS calculator was provided and we found that we couldn't always match the pension and national insurance calculations. Then the penny dropped (literally), as well as ignoring the working days convention, the national insurance and pension calculations were being calculated by rounding down the furlough pay to the nearest pound ignoring the pennies where there were any pence.

Example

Employee furloughed from 1 - 30 April 2020.

February 2020 normal pay £1,663.22. Furlough pay £1,330.58 (£1,663.22 x 80%).

NI via payroll: £82.60 and workplace pension contribution: £24.32

HMRC’s CJRS claim calculator:

Furlough pay = £1,330.58 - as above

Employer NI = £82.52  (based on £1,330)

Pension £24.30 (based on £1,330 - £520 x 3%)

Practical points for CJRS claims

  • The service times out after 15 minutes of activity not 30 minutes as the guidance indicated
  • You are asked to submit a UTR number, CT reference or Companies House reference, but see below for how to deal with care and support employers, employers of domestic staff and parents employing nannies.
  • Employee payroll numbers are requested but are not validated so you can use any identifier that helps you to identify the employee.
  • If you have less than 100 employees you must key in data at the employee level. This is hugely burdensome for weekly payrolls. If reporting over 100+ furloughed employees you can upload a file.
  • There is currently no correction mechanism for CJRS claims. If you need to correct a mistake do this in the next furlough claim, so the total amount claimed over the two or more furlough periods is correct.
  • HMRC has turned the validation off in respect to national insurance numbers for employers uploading files for 100 employees or more. It is not yet clear if this applies to employers with smaller payrolls a well.
  • There is no confirmation email sent after the submission of the claim. You must therefore print the screen with the claim reference number on it as your proof that you made a claim in case of queries.
  • You can only claim for furlough periods that end 14 days in the future – no more. This may be important to clients struggling with cash flow.
  • You need the postcode associated with the client's bank account where the funds will be paid, ie the postcode that is shown as part of the customer's address on the bank statements. Accountants should not use their “client account” to receive the funds.
  • It takes up to six working days for payments to be made following acceptance of a claim.

Oddities

I'm not clear why the guidance says employers must tell employees they have made a claim. It really is nothing to do with employees as they should be paid through the payroll and have an expectation of receiving money based on their furlough letter.  

The HMRC red cover guidance says that changes can’t be made to a claim. I presume that means corrections are outlawed as opposed to additions, for example: if you had missed somebody out completely. HMRC has said it is working on a solution to allow for amended claims.     

Care and support employers

If the employer does not have a UTR number, CT reference or Companies House reference, because they are a private indiviudal and not a business, you should answer ‘no’ to the first 3 questions on the portal:

  • Does the employer submit a company tax return?
  • Is the employer registered for self-assessment?
  • Is the employer registered at companies house?

The next question is: What is the name of the employer?. At this point a charity or individual can answer and continue with the claim.

Salary sacrifice

The most common question I've been getting over the last two weeks is in respect to salary sacrifice.

Please ensure you read the Pension Regulator's guidance published on 17 April 2020 to make sure that you understand you cannot reduce the furlough pay any further in respect to salary sacrifices. The original contractual pay has already been reduced in respect of the sacrifice.

An employer is required to fund those benefits in kind at their own cost, if they reduce furlough pay further they will be paying less than the 80% required.

Replies (65)

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By Richard_Carey
20th Apr 2020 15:54

Fantastic article, thank you.

Thanks (5)
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By djtax
20th Apr 2020 16:29

I have just heard that HMRC will after all update the system to allow amendments (though it cannot do so just yet)

Thanks (2)
Caroline
By accountantccole
20th Apr 2020 17:20

"•You need the postcode of the client's bank account"
Have we got HMRC confirmation of this - it makes sense but the guidance seems to refer to the employer's address

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Replying to accountantccole:
RedFive
By RedFive
22nd Apr 2020 08:02

It's the client address where the bank statement goes to. It's an ML check.

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Replying to RedFive:
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By whiteways
22nd Apr 2020 10:11

I’ve been putting the Bank’s address. That seemed to be what it was asking for, though it isn’t specified.

Thanks (1)
Replying to RedFive:
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By whiteways
22nd Apr 2020 10:13

I’ve been putting the Bank’s address as this seemed to be what it was asking for, although it doesn’t actually specify.

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Replying to whiteways:
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By cazas
22nd Apr 2020 10:56

I have also been putting the bank address in as it is in the section that refers to bank sort code and account number.

Thanks (1)
Replying to cazas:
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By ohwhatnow
22nd Apr 2020 11:10

i have too, i assumed its to do online checks for when they arrange the bacs payments - after all they already know the employers registered address ?

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Replying to cazas:
RedFive
By RedFive
22nd Apr 2020 11:10

Both wrong I'm afraid, but whether that matters remains to be seen.

Banks have not linked branch addresses to sortcodes since they centralised years and years ago.

It is a Money Laundering check. As I say it might not matter.

The wording is terrible though. It states:

"Find the address associated with the employer’s bank account"

It SHOULD say

"Find the Employers address associated with the bank account"

It's just the word Employer in the wrong place. But to be fair to HMRC they did cobble this together in about 2 minutes.

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Replying to RedFive:
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By djtax
22nd Apr 2020 11:59

I have always had my firm's bank correspondence to my home address not office (not uncommon for small business?) . My SBRR grant application has been held up at my local authority due to the 'discrepancy' between my office address and bank statement address. They have asked for a company bank statement 'correctly' addressed....catch 22? I suppose I am going to get the same problem of my CJRS claim….

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Replying to RedFive:
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By markmorley
22nd Apr 2020 15:16

not accoring to hmrc chat. " Ok there's been some confusion about that page and it's been flagged up, hopefully that's rectified soon. It is the address of the bank that should be input here rather than the clients address, if the tool on the page is pulling through an incorrect address based on the banking details then please enter the correct address manually. but doesnt accept . it also repeats the first post code you put in even when overridden so have to clear cookies . but in my case stil doesnt accept . had to use our clientaccount to get claim through .

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Replying to markmorley:
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By markmorley
22nd Apr 2020 15:35

wasted 2.5hrs yesterday and 1,5hrs onone claim today but the web chat is very helpful with limited knowledge had an afterthought plan b will probably fail as the payee account istnt the company and you have no-where to say who th payee account name is . hmrc help staff don't yet know what the failed payment plan is other than contact employer copy agent that implies snail mail with a month or two lead time.

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By keithsharvey
20th Apr 2020 17:43

Not being able to upload a file regardless of the no. of employees is ridiculous.

Thanks (4)
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By valakot
20th Apr 2020 18:52

Hi sorry if it's been already asked and answered but I would appreciate if someone could explain - if 2 employees have been furloughed and I am claiming the 80% salary grant, am I allowed to top up 20% of salary of 1 employee but not top up the salary of another employee if both employees agree of course? The idea is I am one of this employees and I want to pay myself 80% of the salary but top up 20% to pay 100% to my other employee. Is it allowed?
The guidance says employer may choose to top up 20% but can they choose selective in respect to employee?

Thanks (0)
Replying to valakot:
By coops456
23rd Apr 2020 20:22

Yes.
With the general caveat that normal employment law still applies, i.e. an employer could be challenged if it appeared that the decision to top-up - or indeed to furlough or not - was discriminatory in any way.

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By J Russell
20th Apr 2020 20:39

Hi, thank you for the useful article!

The ''calendar days'' caused a lot of confusion on Friday the 17th of April following the update.

I wander how much could one rely on:

''Choose the calculation you think best fits the way your employee is paid. For example, if you pay your employee a regular salary, use the calculation for fixed pay amounts. HMRC will not decline or seek repayment of any grant based solely on the particular choice of pay calculation, as long as a reasonable choice of approach is made.''

Kind Regards

Thanks (1)
Replying to J Russell:
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By s23sgn
20th Apr 2020 22:09

Yes the calendar days is causing me heartache, I’ve 4 weeks pay processed with various furloughed staff at different times, some topped up and others not.

I completely agree with your quote from HMRC - I’m relying on it! :)

Great article btw, huge thanks

Thanks (1)
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By jules66
20th Apr 2020 23:04

Hi, can I check understanding of the section "Employees whose pay varies and started after 6 April 2019" It says that every day/period after they started work is counted in the calculation, including days when no work is undertaken. There is no mention of this for "Employees whose pay varies and were employed all the year. Presumably the same apples, so for casual staff who have worked 6 months out of 12 in the last tax year, we would work an average out over the 12 months, rather than over the 6 months they had worked?

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Pile of Stones
By Beach Accountancy
21st Apr 2020 12:18

Re cancellation / amendments: Made a claim yesterday for a sole director / shareholder for the month of April. Client then decided she didn't want to be furloughed (as now planning to do some work next week), so need to cancel the claim. Contacted HMRC through webchat, then told I'd need to phone the helpline. Got through straight away after the menus (!!) - HMRC lady had to email the technical support team re cancellation - I am awaiting HMRC to call me back.

Thanks (1)
Replying to Beach Accountancy:
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By Homeworker
22nd Apr 2020 10:06

Beach Accountancy wrote:

Re cancellation / amendments: Made a claim yesterday for a sole director / shareholder for the month of April. Client then decided she didn't want to be furloughed (as now planning to do some work next week), so need to cancel the claim. Contacted HMRC through webchat, then told I'd need to phone the helpline. Got through straight away after the menus (!!) - HMRC lady had to email the technical support team re cancellation - I am awaiting HMRC to call me back.


I too am waiting for a call-back. I managed to make a mistake (overclaim) on the first claim I dealt with but could not get through on the phone and was 57th in the queue for webchat. However they got to me within 8 minutes and were very helpful, though I have had to be referred to another department. No problems with any other claims. All in all I am agreeably impressed with how they have coped with the volume of claims.
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Replying to Beach Accountancy:
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By lizbelsby
22nd Apr 2020 12:25

To avoid this, claim in arrears....

Thanks (0)
Replying to lizbelsby:
Pile of Stones
By Beach Accountancy
24th Apr 2020 09:15

Yes but the client wanted the cash asap...

Thanks (0)
Replying to Beach Accountancy:
Pile of Stones
By Beach Accountancy
24th Apr 2020 09:17

It's now Friday, 4 days later, no call from HMRC...

Thanks (0)
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By markmorley
21st Apr 2020 13:53

hi having problems with furlough relief claims with clients at Barclays where one sort code is associated with more than one branch. The HMRC furlough claim system cant recognise the address and you cant override the address manually it keeps getting rejected. paye aren't answering at all and after an hour Barclays helpdesk sympathise took a note to refer up but say HMRC issue . meanwhile, their customers at main branches will have claims blocked.

Thanks (0)
Replying to markmorley:
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By [email protected]
22nd Apr 2020 10:41

It's the address where the bank account is registered, i.e. the business not the banks address.

Thanks (0)
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By markmorley
21st Apr 2020 13:53

hi having problems with furlough relief claims with clients at Barclays where one sort code is associated with more than one branch. The HMRC furlough claim system cant recognise the address and you cant override the address manually it keeps getting rejected. paye aren't answering at all and after an hour Barclays helpdesk sympathise took a note to refer up but say HMRC issue . meanwhile, their customers at main branches will have claims blocked.

Thanks (0)
Replying to markmorley:
RedFive
By RedFive
22nd Apr 2020 07:58

Mark - It's the client address where the bank statement goes to - NOT the bank address.

Thanks (0)
Replying to RedFive:
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By cazas
22nd Apr 2020 11:11

Hi, I have just asked HMRC chat and they are telling me it is the bank address.

Thanks (1)
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By Markm1972
21st Apr 2020 19:16

Hi I have a client who due to human error have not filed their RTI for 4 months. Once there upto date can they still apply. They have been employing and paying staff in this period

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By NStJL
21st Apr 2020 20:07

An interesting anomaly in the online calculator is that if you furlough part way through a month, the calculator looks at the whole NI bill for the month - including on the full pre-furlough salary and then pro-rates that across the pre and post furlough periods to generate the claim amount. This is unlike the pension calculator which looks only at the post furlough period. At the extreme, someone furloughed on a salary of £45k per month (not many, I know) generates a bigger furlough rebate if the furlough starts half way through the month than if it starts at the beginning of the month, because the pre-furlough NI that month is included in the calculation. It seems illogical for NI to be treated differently to pension, but it works in the claimants' favour for once.

Thanks (1)
Replying to NStJL:
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By ohwhatnow
21st Apr 2020 22:55

When I tried to use the calculator it said that you can’t currently use it for periods where staff are furloughed part way through the month, I think they realised it would chuck out this anomaly. There was a note somewhere in the info that said you would need to go through the manual calculation method in this case, and they gave examples etc.

Thanks (1)
Replying to NStJL:
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By Rebecca Tang
22nd Apr 2020 11:47

I spotted this too and logged a query with HMRC which has been escalated (still waiting for a response 2 days later).

The calculator also doesn't take into account other pay elements paid to employees pre-furloughing which are subject to NICs but can't be reclaimed.

Thanks (0)
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By steve marsland
22nd Apr 2020 09:55

You don't actually need a UTR number to make a claim. We have had this confirmed by HMRC. Where the client has a payroll scheme set up and has been making RTI submissions before 19 March but hasn't registered for SA yet (deadline is generally 5 October after the tax year) you can simply answer no and you can still submit.

Also, with regard to employment allowance we have also had confirmed from HMRC that this can be deferred and claimed later in the year when furlough has ended. However, it may mean a business has an NI liability for April if they employees were furloughed part may through that month.

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Replying to steve marsland:
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By John Wheeley
22nd Apr 2020 11:49

Do you know if the advice on deferral of employment allowance has been published anywhere by HMRC please?

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Replying to steve marsland:
By coolmanwithbeard
24th Apr 2020 09:17

The guidance actually says that you should not claim ni relief if the allowance was a available

Thanks (0)
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By monksview
22nd Apr 2020 09:55

The calculator doesn't work where there is NI to pay and the employee is topping up to 100% of pay, its says further guidance will be issue don that. Anyone know how it should be calculated?

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By elainemclenan
22nd Apr 2020 10:07

I wondered if anyone has tried to process a claim for an employee who is under 16 so has no national insurance number. The portal won't let you leave the NI number blank. I've tried to contact HMRC but can't get through.

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Replying to elainemclenan:
Woof
By Doris
22nd Apr 2020 10:22

Yes, I have tried and couldn't get through, it was the employers daughter and only for £30 so she said to proceed without her included as didn't want to delay the bulk of the repayment. Interested to know what to do in this situation though.

Thanks (1)
Replying to elainemclenan:
By coolmanwithbeard
22nd Apr 2020 12:11

I have had a client come accross this and I have one to do with this. THe client has a level 3 enquiry with HMRC on it and will let me know!!

Thanks (2)
Replying to elainemclenan:
By coolmanwithbeard
22nd Apr 2020 12:11

I have had a client come accross this and I have one to do with this. THe client has a level 3 enquiry with HMRC on it and will let me know!!

Thanks (0)
Replying to coolmanwithbeard:
By coolmanwithbeard
24th Apr 2020 09:19

If employee with no nino you need to ring them and make the claim by phone

Thanks (1)
Woof
By Doris
22nd Apr 2020 10:21

Great article, thank you. I have a situation where an employer didn't pay there employee in January and February as they didn't work, will they still be entitled to a furlough payment if now pay put through for February based on average wages for 2019/20? They haven't left employment, just didn't work January and February......... TIA

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By Marlinman
22nd Apr 2020 10:41

I entered the employer address registered with the bank. Would have to google the sort code to find the postcode of the branch and this seems irrelevant.

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Replying to Marlinman:
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By cazas
22nd Apr 2020 11:10

I have just spoken to the HMRC chat and they confirm that it is the address of the bank that they are wanting.

Thanks (1)
Replying to cazas:
RedFive
By RedFive
22nd Apr 2020 12:14

Yes, webchat state that.

But the PDF guidance here

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

States

Now you are ready to make a claim. Go to GOV.UK to make your claim The service will be available for claim submissions from 20 April. You will not be able to access it before this date. You will be taken through a series of steps in the online service. Y ou will need to confirm that you have furloughed your employees, then you will need to input the information about your organisation which you prepared in step 2. After this, you will need to confirm the amount of the claim – split into the total amount to be paid to furloughed employees and the total pension and national insurance contributions, that you will have prepared at step 3. Before you submit the application, you will also need to confirm your employees’ details, enter your UK bank details and your address.Now you are ready to make a claim. Go to GOV.UK to make your claim The service will be available for claim submissions from 20 April. You will not be able to access it before this date. You will be taken through a series of steps in the online service. Y ou will need to confirm that you have furloughed your employees, then you will need to input the information about your organisation which you prepared in step 2. After this, you will need to confirm the amount of the claim – split into the total amount to be paid to furloughed employees and the total pension and national insurance contributions, that you will have prepared at step 3. Before you submit the application, you will also need to confirm your employees’ details, enter your UK bank details and YOUR address.

The final line states YOUR (my capitals) address.

Thanks (0)
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By Rebecca Tang
22nd Apr 2020 11:44

On several HMRC sources (including when you start a claim) it states 'You will not be able to make another claim for the same claim period.'
Our payroll runs for each calendar month, where employees are paid on the 25th of each month. If a last minute decision is made to furlough employees after the payroll and after the furlough claim, but during the claim period does this mean we cannot retrospectively reclaim in the following month for the last few days of the previous month? ie payroll is completed for April and furlough claim is made up to and incl 30/04/20. Late decision is made to furlough somebody from 27/04/20 so we are not able to reclaim furlough amounts for 27/04/20 - 30/04/20 when we make our next submission in May 2020?

Several HMRC sources (including the step-by-step guidance) say you must make the claim 'shortly before or during running payroll', but the HMRC YouTube channel clearly shows that the claim can be made AFTER the payroll (in which case is it safer to hold off claiming until the end of the claim period incase late furlough decisions are made after the payroll?)

Thanks (0)
Replying to Rebecca Tang:
By coops456
23rd Apr 2020 20:29

It would be wiser to wait until after the calendar month ends. It's not like an FPS that must be filed on or before payday.

The CJRS claim can - not must - be made before payday.

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