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Coronavirus Job Retention Scheme top FAQs answered

Kate Upcraft and Rebecca Benneyworth tackle the most vexing questions from HMRC’s furlough scheme.

24th Apr 2020
Editorial team AccountingWEB.co.uk
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This week’s session of the Coronavirus Response Q&A webinar focused on payroll issues including the mechanics of furloughing and statutory sick pay.

Payroll expert Kate Upcraft provided a nuts and bolts practical summary of key payroll issues, including furloughing formulas and calculations, how to claim and National Insurance issues. Upcraft and Rebecca Benneyworth also revisited some of the most pressing CJRS questions, which we have compiled below. 

Upcraft applauded the effort made by agents and large employers doing claims, taking into account the niggles they were seeing and the changes to the calculations brought by the new guidance that was published late on 17 April.

“I think the assumption is that this is all part of a payroll service. And it's not, it's making a claim for state aid, which is completely different from offering a payroll service. So people who are expecting us all to be experts in something that nobody is an expert in because it is new and not related at all to payroll.”

One of the challenges that, according to Upcraft, was never obvious in any of the previous versions of the guidance, is that the calculation of grant uses calendar days for the pay month, whereas many employers use working days in the month when calculating their own payroll.

“You can't just extract figures from the payroll and upload them. Because if you do that there is the potential your claim may be not rejected immediately, but if the discrepancy is uncovered down the line and you'll be asked for money back because it's a standalone calculation that doesn't work to any of the standard payroll formulas.”

Coronavirus Job Retention Scheme top FAQs

Where a director is paid annually at the end of March the CJRS claim was ineligible. How can you make this work?

Rebecca Benneyworth: If somebody who didn’t pay their annual salary before 19 March applies for furlough pay, the response from HMRC is that the person is ineligible. There isn't a way forward as the legislation says the payment of earnings in 2019/20 had to be made before 19 March. 

The ICAEW has raised this issue with HMRC but it would appear that the system is working in accordance with the legislation and the annual payment must have been included in an RTI report filed by 19 March 2020.

How should a business with both weekly and monthly paid furloughed employees proceed if they’re only allowed to make a one claim for a period under the scheme? If the business claimed for 3 weeks in total for weekly paid staff, say from 02/04 to 23/04 does that then mean it cannot claim for monthly paid staff from 01/04/ to 30/04?

Kate Upcraft: There’s a bit of a date game here to work out how best to do it. You've got to amalgamate the weeklies and monthlies, because you are only permitted to make one claim per PAYE scheme every three weeks. So pick the furlough period that covers the all the monthly and as much of the weeklies as you can, and put through the rest of the weeklies in the next batch in three weeks.

The ICAEW advises that care should be taken to include all eligible employees for a claim period within a single claim, as a further claim is not possible for the same claim period. You can claim 14 days in advance, but claims cannot end more than 14 days ahead of the date of the claim. 

If someone has claimed too much NI in April, can you correct it by claiming less for May? 

Rebecca Benneyworth: I think commonsense will prevail and there appears to be an intention at HMRC that you will be able to correct - but we don’t know the details yet. If you have adjusted a later claim to compensate for an overpayment in the previous period, overall you're going to be right and you'll be fine. If you find that you've done something wrong, that's absolutely what I would recommend doing. 

The ICAEW Tax Faculty asked HMRC how employers can correct mistakes made when making a claim. HMRC replied: “The ability to amend for future claims will be available, but we do not have a process in place at the moment.” 

Can an employer opt NOT to claim the employer's allowance (EA) whilst furloughing is being accessed and switch the EA claim on once furloughing ends, as long in the remainder of the tax year when they will have built up £4,000 in employer’s NI to cover the allowance? 

Kate Upcraft: It’s a very common question, but we still don't have clarity in the moment. I would suggest you put the employment allowance to one side at the moment and turn the EA claim off in your payroll software. All EA claims have to be remade for 2020/21, they do not carry over from 2019/20 as the conditions for the claim have changed.   

If you're offsetting the employment allowance in your April payroll, then you should be doing the same thing in your CJRS claim because clearly you haven't paid that NI covered by the EA. We'll find out later in the year what HMRC wants to do about this. If you turn EA on again in September, it will backdate to April and give you that £4,000. Maybe HMRC will say that's okay, because this the employment allowance is a kind of de-minimis state aid and the CJRS is not. 

Whose postcode should you enter on the CJRS claim system’s address screen?

One of the screens of HMRC’s portal, which immediately follows the bank account data, asks for a postcode associated with that account and presents a list of addresses for that postcode. Because of the screen sequence, you might assume it's the address of the bank. But that isn't what it's asking for - the postcode you enter should be the address of the employer or of the individual (if they’re employing a domestic worker like a nanny).

How do salary sacrifices work under furlough?

Kate Upcraft: Once you have agreed a salary sacrifice, somebody has given up their pay in exchange for a benefit in kind. In this case, it is particularly around pensions, but it could be  for example; childcare vouchers, a bicycle, or a car. Once you have done that, they are earning less cash pay. 

So that's the starting point for the furlough calculation, not their original pay, but you're still on the hook for paying over the pension or providing the benefits in kind because that's the deal you struck when you redrew the employee’s contract. Changing their contract going forward won't make any difference. Doing a change now to somebody's salary sacrifice doesn't mean you can go back and change history as to what was happening in February.

Employers with 100 or more employees can upload their data to the CJRS on a spreadsheet. This is unfair on smaller employers who need to spend hours inputting each employee’s details by hand. Will the system be changed to allow spreadsheets to be uploaded with fewer than 100 employees?   

ICAEW has asked HMRC for a response, and HMRC indicated that it will consider reducing the 100-employee requirement and allow file uploads for smaller employers, but this may not be possible.

Hosted by AccountingWEB experts, Coronavirus Response Q&A brings together accountants to talk about the impact of the coronavirus, share what they’ve learned and the practical steps they’re taking to safeguard their practices and support their clients. Register to watch next week's event, where we will be joined once again by Rebecca Benneyworth and Kate Upcraft to answer your questions.  

You can download a CJRS template here

Replies (47)

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Northumberland flag
By MJShone
24th Apr 2020 13:25

There was mention of a template in the webinar. Where can that be found? Although it's quite easy to do one's own, I think it might just help to make sure nothing is missing.

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Replying to MJShone:
Valme Claro
By Valme Claro
24th Apr 2020 15:34

Hi MJShone, you can find it here: https://www.accountingweb.co.uk/files/cjrs-example-layout
We will also email a copy to all those who attended the webinar.

[edited to update link]

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Replying to Valme Claro:
Northumberland flag
By MJShone
24th Apr 2020 15:54

Thank you so much for this.

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Replying to Valme Claro:
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By Great1
26th Apr 2020 01:08

Hi Valme,

the link to the file appears to be down. could you kindly re upload the template?

thanking you!

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Replying to Great1:
Valme Claro
By Valme Claro
27th Apr 2020 08:36
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By AS44NG
24th Apr 2020 21:08

I'm was feeling fed up with all of this. Working silly hours to keep up and feeling unappreciated. Left the office at 8pm yesterday and was surprised to see the locals lining the streets applauding me so maybe i am being appreciated after all.

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Replying to AS44NG:
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By jilbo
27th Apr 2020 09:57

:-D

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Replying to AS44NG:
Morph
By kevinringer
27th Apr 2020 14:13

We all know you're a legend

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By markabacus
26th Apr 2020 14:27

Just catching up with some my 'read' emails, well else on a Sunday afternoon! Webinar email with link to CJRS template doesn't work nor the one in an earlier 'reply' :-(
Fortunately I've already produced a spreadsheet for my wife to use and the HMRC examples all work out correctly so hopefully it will be ok but will check to the template if it reappears

Frustrating but the webinars have been very useful

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Replying to markabacus:
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By johnjenkins
27th Apr 2020 09:37

Although I know some hard work has gone into this article but I'm not sure it has achieved much, if anything. It's down to HMRC to sort out the problems. Government has said it wants to pay 80% of furloughed workers up to £2500. It is not now up to HMRC to decide who should get that money and under what circumstances.

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By 0098087
27th Apr 2020 09:34

re annual. We spoke to HMRC and they said just take 1/12 th and it's okay.

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Replying to 0098087:
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By philaccountant
27th Apr 2020 10:15

Interesting. How do you make the claim though? You can't do it through the online portal as they don't show as employees.

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Replying to philaccountant:
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By CatsandDogs
27th Apr 2020 16:40

HMRC called me back about this on Thursday and said that these payrolls were eligible but that they were working on an over-ride to the system to enable the claims to go through.. So the advice was that they could claim but we can't actually get the money until they apply a fix...

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By sbeardon
27th Apr 2020 09:39

It clearly says here that if you can claim employment allowance then you should and not claim through the CJRS scheme, or am I missing something.

https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim...

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Replying to sbeardon:
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By johnjenkins
27th Apr 2020 09:46

This morning just had a client on the phone saying his UC etc. had been stopped because we put his yearly payroll through (although he tells UC of his monthly income).

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By enoryt010
03rd Jun 2020 12:23

I have had this happen.
The UC looks at payrolls run during the relevant UC period and doesn't take into account what it represents.
If it is above a certain amount (I can't remember off hand) some of it will be carried forward and it will be possible that they won't get any UC the following month either.

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Replying to sbeardon:
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By mkowl
27th Apr 2020 09:48

You are correct when it comes to the employers NI. However the change in guidance was quite late in the day so a couple of our client claims inadvertently included it. We are talking very minimal sums. Our approach will be simply to deduct this from the next claim or not claim the employers allowance this month. Sometimes you just need to take a pragmatic approach

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By [email protected]
27th Apr 2020 10:02

Thank you so much for clarifying the postcode / address.
This caused a few sleepless nights last week wondering if the claim would be paid.
I had put the sort code associated bank branch address but thankfully the claim was still paid - the guide was very ambiguous

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Replying to [email protected]:
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By uktaylor
27th Apr 2020 10:46

I couldn't get my head around the postcode. It wasn't clear. I have used the bank account address. I hope they get paid.

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Replying to uktaylor:
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By MissB
27th Apr 2020 11:17

I have also used the bank account address and because of the confusion I checked this with HMRC online chat last Wednesday. They also said it was the bank account address. Fingers crossed all the claims I made last week are paid out this week.

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Replying to uktaylor:
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By [email protected]
27th Apr 2020 12:41

I did the same (bank branch sort code) and the claims I put in on Monday were received today.
I did notice that HMRC are now saying it will be paid within 6 working days - I am sure it was saying 5 last week

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Replying to uktaylor:
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By [email protected]
27th Apr 2020 12:41

I did the same (bank branch sort code) and the claims I put in on Monday were received today.
I did notice that HMRC are now saying it will be paid within 6 working days - I am sure it was saying 5 last week

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By mikegabb
27th Apr 2020 10:16

'' you are only permitted to make one claim per PAYE scheme every three weeks.''

This is wrong, as I have just had confirmed to me on the JRS live webchat, and by the weekly claims I am now making. It would defeat the point of the scheme if weekly paid workers only got paid every three weeks!

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Replying to mikegabb:
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By Homeworker
27th Apr 2020 10:24

mikegabb wrote:

'' you are only permitted to make one claim per PAYE scheme every three weeks.''

This is wrong, as I have just had confirmed to me on the JRS live webchat, and by the weekly claims I am now making. It would defeat the point of the scheme if weekly paid workers only got paid every three weeks!


Ah, but the workers should be paid as normal. It is the employer who has to bear the cost until the claim can be made.
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By Homeworker
27th Apr 2020 10:26

Has any thought been given about the final claim, when furlough ends? I have a builder client (Ltd company) who has been asked to go back to work next week but doesn't want to because he won't have accrued a further three weeks to claim and doesn't know if he can claim for a shorter period!

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Replying to Homeworker:
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By Martymcfly
27th Apr 2020 10:38

I would have though once the initial 3 weeks had gone you can submit claims weekly( if doing weekly payrol).

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By Martymcfly
27th Apr 2020 10:37

Maybe I was given incorrect advise but was told by Hmrc advisor that you can claim for overlapping periods, ie we have weekly paid that have been furlough for at least 3 weeks so have claimed for them but during the last week of that period we were forced to put more weeklys onto furlough. But cannot claim for them for another 3 weeks. In an ideal cash rich world we would have just submitted at claim at the end of the 5 weeks. But we are not I. That position. Will see what happened when we try to claim in 2 weeks time....

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Replying to Martymcfly:
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By mikegabb
27th Apr 2020 10:52

The software will not let you claim for overlapping periods but will allow claims for a two week period

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By Helen H
27th Apr 2020 10:39

I have various clients who took on employees on 2nd or 9th March but as the employees are all paid monthly, they were not put onto the payroll until the end of March and then RTI submitted on say 31st March. But the RTI submission states the date the employees started (ie 2/3/20), I can not put these employees onto the CJRS as they were not notified on an RTI until after 19/3/20. Is this really correct in light of Rishi Sunak's change of heart to allow new employees employed by 19/3/20 to be able to be included within the CJRS?? Or am I missing something?

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Replying to Helen H:
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By wd2016
29th Apr 2020 22:34

Helen H wrote:

I have various clients who took on employees on 2nd or 9th March but as the employees are all paid monthly, they were not put onto the payroll until the end of March and then RTI submitted on say 31st March. But the RTI submission states the date the employees started (ie 2/3/20), I can not put these employees onto the CJRS as they were not notified on an RTI until after 19/3/20. Is this really correct in light of Rishi Sunak's change of heart to allow new employees employed by 19/3/20 to be able to be included within the CJRS?? Or am I missing something?


I have the same situation with one client and another that we only registered for PAYE in March (employees were on payroll before that but no submissions made) but the details came through after 19th March. Surely there is some way to include these people? Any advice would be appreciated.
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Replying to wd2016:
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By johnjenkins
30th Apr 2020 09:41

HMRC software isn't up to scratch so these problems will arise. If the Government want people to be paid who started prior to 19/3/20 then they are going to have to do something PDQ. Don't forget this is just a temporary measure so I cant see a lot of expenditure on updating software being forthcoming. The easiest way is a note to HMRC giving details. All HMRC have to do is then check the submissions and verify the start date.

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Replying to johnjenkins:
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By wd2016
26th May 2020 20:36

I contacted HMRC and they flat out refused a work-around even though the person started before the deadline, because the filing wasn't done until the end of the month. Not much point in making the change to the deadline if it is going to miss out everyone on monthly payroll! Anyone else have this scenario and had luck with HMRC?

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By ARoberts
27th Apr 2020 10:56

Due to minimum wage some of our lower skilled employees wages went up at the beginning of April to ensure compliance. I have gone to submit the amounts for furlough for April and on the website it says take the salary/wage as of 19th March but that's lower than it is for April due to the min wage increase. I called HMRC about it and they weren't sure!! They said do we have an agent or accountant we can check with, even though it's their scheme! Does anyone know the answer to this? Thanks

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Replying to ARoberts:
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By kevin.robins
27th Apr 2020 11:21

Hi there
This is very clear in the guidance. You don’t claim based on current wages but on the pay per 19 March (previously announced as 28 February). This is to stop everyone paying themselves extra amounts and I’m afraid that the NMW increases have to be regarded as extra amounts. It’s unfortunate but just one of those things. There is a theory that the NMW increase is irrelevant anyway as they are on furlough so aren’t getting a wage!

It is likely that with the increase in the amount you will have paid a top up of more than 20% - NI and pension calculations will have to take this into account.

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By lh3f9764bg1g
27th Apr 2020 11:00

Has anybody considered the situation for Ministers of Religion? It seems to me that they are "employed" even though they may not receive a bean from an established church - whilst at the same time they are not self-employed either. Do/can they fit in to either scheme?
C.

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7om
By Tom 7000
27th Apr 2020 11:28

Very good. But this is 2 people giving their opinions.
Why cant HMRC just clarify these points and say this is THE LAW... you must do it this way or you may do it either way?

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By markabacus
27th Apr 2020 11:55

One of the key points is whilst the payments are being made thru Payroll to furloughed employees and taxed etc as income it is NOT salary/wages but a Government support and the employer is claiming state aid in the reclaim.

So NMW has now bearing on the calculation if the employee is furloughed nor has any pay rises that employers have implemented following the scheme being announced

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By fmt100
27th Apr 2020 12:12

Please could you advise me. Would Directors that were paid twice yearly in 2019/20 and hence were eligible for the scheme now need to operate monthly payroll in 2020/21 to ensure future claims will be eligible?

Thank you

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Morph
By kevinringer
27th Apr 2020 14:19

Kate, you say 'you are only permitted to make one claim per PAYE scheme every three weeks'. I can't see that in the guidance. Please can you point it out to me.

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By North East Accountant
27th Apr 2020 17:07

Surely, it was not beyond the skills of HMRC to put together a spreadsheet for everyone to use rather than everyone having to do their own (or [***] one off a pal, thanks to you know who).

I know HMRC put this together in a hurry but surely there is a case in future for government issued collateral for all laws, regulations, etc which all business can just download and use.

Also, there are so many key areas where there is no definitive answer, eg. employment allowance and sole directors,

Yet we will be judged by 2.30pm finishing PAYE inspectors, who will have the benefit of hindsight and who have no concept of what making tough decisions during an 18 hour day looks like.

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Replying to North East Accountant:
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By hrimmer
28th Apr 2020 11:00

Not used this before but does anyone know how we get around not having an NI number for an employee when making a claim for less than 100 - have logged a call but still waiting! - thank you

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Replying to hrimmer:
Pile of Stones
By Beach Accountancy
28th Apr 2020 15:23

I did one yesterday. The website rejected the old temporary NI number workaround (such as TN010190M), so I put in AB123456A. This was accepted - waiting to see if we get the cash though...

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By Smalltalk
01st May 2020 10:07

If some employees do have odd overtime in last tax year, on top of their regular monthly pay, which makes their average monthly pay higher than current monthly pay shall they not be put on furlough, which pay should it be used for the calculation, last year's average or normal pay?

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Replying to Smalltalk:
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By sbeardon
09th May 2020 08:34

Last years average

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By Smalltalk
01st May 2020 12:12

Does anyone find the calculation on GOV.uk does not seem to make sense?

I tried the real figures which didn't come to the figures i expected, so i tried a nominal £1000 pay per month paid on 15th of the month, furloughed from 1st Apr to 30th Apr, the figures calculated was for
What you can claim for this employee
Amount paid to this furloughed employee

£521.74
Employer National Insurance contributions

£12.33
Employer minimum pension contributions

£5.46

Any idea how I get wrong on this? thanks

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By EllaB
23rd Jul 2020 09:42

Hi Kate

Do you have any thoughts on staff with term time only contracts (or zero hours but no hours are ever worked during the school holidays) and whether they can be included within the JRS during the school holidays?

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Replying to EllaB:
By 0098087
23rd Jul 2020 09:58

we have a client who has a nursery and they aren't paid in the summer and they'll miss out. Six weeks into CJRS they moved the goalposts for calculating for them,
However my own view is, if they aren't normally paid in the summer then they shouldn't be under CJRS.

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