We summarise the key points in the furlough scheme update below:
There are no changes to the core elements of the Scheme. For the Relevant Period, employers will continue to be able to claim for 80% of an eligible employee’s salary, capped at £2,500 per month, in respect of hours not worked, and will continue to be required to pay the employer national insurance and employer auto-enrolment pension contributions on furloughed employees’ pay. Employers will also not be able to make claims for employees who are working their notice period.
As promised, HMRC published the first details of employers who have made claims under the scheme on 26 January 2021. The publication provided information about employers who made claims in December 2020. These publications will continue to be made for claims made between 01 February 2021 – 30 April 2021.
The deadlines to submit claims covering the Relevant Period are as follows:
o February: 15 March 2021
o March: 14 April 2021
o April: 14 May 2021
Any amendments to be made to claims in respect of the same period are subject to the following deadlines:
o February: 29 March 2021
o March: 28 April 2021
o April: 28 May 2021
For non-fixed rate employees, employers are required to use the employee’s pay in March and April 2019 as their reference salary for calculating their furlough pay for March and April 2021. The Sixth Treasury Direction recognises that by March 2021, the Furlough Scheme will have been running for a year. This means that an employee who is furloughed in March or April this year could have also been furloughed in March or April 2020.
The Direction, therefore, modifies the relevant reference year for those months to 2019 instead of 2020. When calculating an employee’s January or February 2021 furlough pay, the corresponding calendar month in 2020 should be used, as the Furlough Scheme did not start until March 2020.
Similar changes have been made to the calculation of a non-fixed rate employee’s usual working hours for March and April 2021 due to the possibility that any such employee could have also been furloughed in the corresponding month in 2020.
Where a non-fixed rate employee was not employed in March or April 2019, HMRC’s ‘Calculate how much you can claim using the Coronavirus Job Retention Scheme’ explains that an employer can only use the averaging method to calculate their usual working hours.