What is the Coronavirus Job Retention Scheme?
No doubt you’ve already heard people talk about the coronavirus job retention scheme.
It means that all employers will be able to access financial support to continue paying part of their employees’ salary. These employees would have otherwise been laid off during this crisis. So you are able to avoid making your staff redundant.
You can claim 80% of your employees wages plus any employer National Insurance and payment contributions, if you have put them on furlough because of coronavirus. Though there is a cap of £2500 per employee per month.
How long is the scheme due to last?
HMRC launched its online claim service and portal for the Coronavirus Job Retention Scheme on 20th April 2020.
At the moment, the scheme is planned to run from 1st March until the end of July 2020, and then from August until October 2020 employers will be expected to contribute towards the furlough payments – the proportion of which is yet to be confirmed. We’re doing our best to keep everyone updated and in the loop, so keep your eyes peeled for more information.
How do you claim as an employer?
First things first, you need to be registered with HMRC for PAYE online. You’ll then need the Government Gateway user ID and password which you were provided when you previously registered for PAYE online.
Remember guys, you need to submit your claim in one session – you cannot save it and return later. Sessions will time out after 15 minutes of inactivity. So make sure there are no distractions!
The four steps you’ll need to take in order to use the scheme:
If you are a business owner and want to take advantage of the scheme then there are four steps that you must take. They are:
- Check if you can claim.
- Calculate 80% of your employees’ wages.
- Claim for your employees’ wages.
- Report a payment in PAYE Real Time Information.
Make sure you have the following paperwork prepped and ready to go:
- UK bank account number and sort code
- your employer PAYE scheme reference number
- the number of employees who are being furloughed
- the National Insurance number of each employee
- each employee’s payroll or employee number (optional)
- the start date and end date of the claim
- the full amount you’re claiming for including employer National Insurance contributions and employer minimum pension contributions
- your usual phone number
- contact name
And remember, you also need to provide either:
- your name (or the employer’s name if you’re an agent)
- your Corporation Tax unique taxpayer reference
- your Self Assessment unique taxpayer reference
- your company registration number
What do you need to do after you’ve claimed?
You’ll receive a claim reference number from HMRC. They will then check your claim is correct and pay the claim amount within 6 working days.
Make sure you keep a copy of the following:
- the amount claimed and claim period for each employee
- the claim reference number for your records
- your calculations (just incase HMRC need more information about your claim)
It’s important to also let all of your employees know that you have made a claim – so they don’t take any more action! And if you haven’t already, pay all your employees their wages.
What next?
We hope that this quick breakdown of the scheme and what you need to have prepped has made things a little less confusing. If you want us to take away the headache of doing this yourself then get in touch with us for a free, no-obligation quote. We’d be more than happy to take the stress away!
