Coronavirus Job Retention Scheme

Job Retention Scheme

If your business operations have been severely impacted by COVID-19, you can furlough your employees and claim 80% of their wages, up to a cap of £2,500 per month. 

Read the HMRC Guide

Claim for Wages through Online Service

Eligibility

Any business with a UK payroll can apply, including charities, recruitment agencies and public sector organisations, as long as:

• they have created and started a PAYE scheme after 19 March 2020
• they are enrolled in PAYE online
• they have a UK bank account

Claims can be made for any employee or apprentice on any kind of contract, as long as they were on the payroll on or before 19 March 2020. Any employee hired after this date cannot be furloughed. 

If your employee is on unpaid leave, If an employee started unpaid leave after 28 February 2020, you can furlough them and can claim their wages through the scheme.

If an employee is sick or self-shielding, if they are sick they will be eligible for Statutory Sick pay (costs for two weeks can be claimed back by the employer) after their sick leave they can be furloughed and paid for through the scheme. If they are self shielding, they can be furloughed and claimed for through the scheme.

Employees can volunteer or undertake training while furloughed, as long as the training does not generate income for the business. 

If you made employees redundant or they stopped working for you after 28 February, you can re-employ them, put them on furlough and claim for their wages through the scheme.

This applies to employees that were made redundant or stopped working for you after 28 February, even if you do not re-employ them until after 19 March. This applies as long as the employee was on your payroll as at 28 February and had been notified to HMRC on an RTI submission on or before 28 February 2020. This means an RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 28 February 2020.

Company Directors

As office-holders, salaried company directors are eligible to be furloughed and receive support through this scheme. Company directors owe duties to their company which are set out in the Companies Act 2006. Where a company (acting through its board of directors) considers that it is in compliance with the statutory duties of one or more of its individual salaried directors, the board can decide that such directors should be furloughed. Where one or more individual directors’ furlough is so decided by the board, this should be formally adopted as a decision of the company, noted in the company records and communicated in writing to the director(s) concerned.

Salaried Members of Limited Liability Partnerships (LLPs)

Members of LLPs who are designated as employees for tax purposes (‘salaried members’) under the Income Tax (Trading and Other Income) Act (ITTOIA) 2005 are eligible to be furloughed and receive support through this scheme.

Employer National Insurance and Pension Contributions

You’ll still need to pay employer National Insurance and pension contributions on behalf of your furloughed employees, and you can claim for these too.

You cannot claim for:

• additional National Insurance or pension contributions you make because you chose to top up your employee’s salary
• any pension contributions you make that are above the mandatory employer contribution

Past Overtime, Fees, Commission, Bonuses and non-cash payments

You can claim for any regular payments you are obliged to pay your employees. This includes wages, past overtime, fees and compulsory commission payments. However, discretionary bonus (including tips) and commission payments and non-cash payments should be excluded.

Employee taxes

Employees will still pay the taxes they normally pay out of their wages. Including pension contributions (both employer contributions and automatic contributions from the employee), unless the employee has opted out or stopped saving into their pension.

Before you Claim

You will need the following before making a claim:

1) A Government Gateway (GG) ID and password – if you don’t already have a GG account, you can apply for one online.
2) Be enrolled for PAYE online – if you aren’t registered yet, you can enrol online.

What to Include when Calculating Wages

The amount you should use when calculating 80% of your employees' wages is regular payments you are obliged to make, including:

• regular wages you pay to employees
• non-discretionary overtime
• non-discretionary fees
• non-discretionary commission payments
• piece-rate payments

You cannot include the following when calculating wages:

• payments made at the discretion of the employer or a client - where the employer or client was under no contractual obligation to pay, including:
  • any tips, 
  • discretionary bonuses
  • discretionary commission payments
• non-cash payments
• non-monetary benefits like benefits in kind (such as a company car) and salary sacrifice schemes (including pension contributions) that reduce an employees’ taxable pay

Find out more on how to calculate 80% of wages

Making a Claim

The scheme is open for claims. You will receive payment six working days after making an application.

Employers should agree changes with employees and changes to employment contracts, formally in writing. Not all employees need to be placed on furlough if your business is still operating. A furloughed employee can not undertake any work for the employer. 

Employers can claim 80% of employees wages, including National Insurance Contributions and and automatic pension contributions.

Employers can top up a salary should they wish. 

To make a claim, employers will need:

• ePAYE reference number
• Your Self-Assessment UTR (Unique Tax Reference), Company UTR or CRN (Company Registration Number)
• the number of employees being furloughed
• the claim period (start and end date)
• amount claimed (per the minimum length of furloughing of 3 consecutive weeks)
• bank account number and sort code
• company contact name
• company phone number

The following information is required for each employee:

• Name
• National Insurance number
• The total furlough period
• The total amount being claimed

If you have fewer than 100 furloughed staff – you will need to input information directly into the system for each employee.

Claims for 100 or more staff

If you’re claiming on or after 1 July 2020 for 100 or more employees, you’ll need to upload a file. A template is available for you to fill in. 

Employers will need to calculate the amount they are claiming. HMRC will retain the right to retrospectively audit all aspects of a claim. Claims can be backdated to 1 March 2020.

Read HMRC Guide on how to calculate how much you claim

After you've Claimed

HMRC will check your claim, and if you’re eligible, pay it to you by BACS to a UK bank account.

You must pay the employee all the grant you receive for their gross pay, no fees can be charged from the money that is granted.

If you make an error when claiming

If you have made an error in a claim that means you’ve received too much, you must pay this back to HMRC. You can either:

• tell HMRC as part of your next online claim (your new claim will be reduced and you’ll need to keep a record of the adjustment for 6 years)
• contact HMRC to pay the money back (you should only do this if you’re not submitting another claim)

If you’ve overclaimed a grant and have not repaid it, you must notify HMRC by the latest of either:

• 90 days after the date you received the grant you were not entitled to
• 90 days after the date you received the grant that you were not longer entitled to keep because your circumstances changed
• 20 October 2020

If you are making another claim then you can tell HMRC about an over claimed amount as part of this. When you make your next claim you will be asked whether you need to reduce the amount to take account of a previous over claim. Your new claim amount will be reduced to reflect the over claimed amount and you should keep a record of this adjustment for 6 years.

If you have not claimed enough

If you have made an error that has resulted in receiving too little money, you will still need to ensure you pay your employees the correct amount. You should contact HMRC to amend your claim. As you are increasing the amount of your claim, we may need to conduct additional checks.

You are no longer be able to amend a claim relating to the period up to 30 June to add an employee that should have been included on a claim submitted before that date. You must make sure that any remaining claims still to be made for the period to 30 June include all of your eligible employees. Amendments for any other errors you made that resulted in you not claiming enough will still be permitted.

Read more about paying a grant back

When the government ends the scheme

When the government ends the scheme, you must make a decision, depending on your circumstances, as to whether employees can return to their duties. If not, it may be necessary to consider termination of employment (redundancy).

HMRC will process all claims made before the scheme ends.

Contact HMRC

Do not contact HMRC unless it has been more than 10 working days since you made the claim and you have not received it in that time.

If you need to contact HMRC after 10 working days, you can call 0800 024 1222 or you can chat online with an advisor.

Contact HMRC about the CJR Scheme

Claim for Wages

Template for claims for 100 employees or more

View more information and FAQ's 

View HMRC guide on the scheme

 

This page was last updated 3 March 2021.