Coronavirus Job Retention Scheme extended to end of October 2020
By Justine Riccomini Head of Taxation (Scottish Taxes, Employment and ICAS Tax Community)
13 May 2020
Further to a letter from ICAS Chief Executive Bruce Cartwright CA to UK government raising concerns about the phasing out of the Coronavirus Job Retention Scheme (CJRS), ICAS is pleased that the scheme has been extended. Here, Justine Riccomini explains the latest developments.
The announcement
The Chancellor announced a further extension to the CJRS on 12 May, taking it to the end of October 2020.
The measures, which have affected over 7.5 million workers in the UK, will remain as they are with an 80% furlough payment level until 31 July 2020, followed by further measures which will allow for part-time working and flexibility in the return to work between 1 August and 31 October. The precise detail of these measures is not known at present, but further announcements will be made in due course. It is clear that after 31 July, however, employers will be asked to pay some of the salary costs.
Cliff Edge
The move avoids the “cliff edge” which was looming on 30 June before the announcements were made and also allays some fears of large scale redundancy programmes at the same date, which have been eased by the extension and the prospect of a stepped return to work. The collective consultation requirements for redundancy have also been sidestepped – for employers with 100+ employees, this 45-day key date would have been reached by 15 May and for employers with 20-99 employees, the next collective consultation 30-day key date was to have been 30 May.
Employer decision-making
It is then up to each employer to decide whether it is able to let employees return to work safely and with due heed to their own duty of care and Health & Safety regulations.
Devolved stances
Bear in mind that the UK Government documents published on 11 May apply only to England because the devolved jurisdictions have produced their own stances on how things will be in those areas. This is serving to complicate matters somewhat, especially for employers with cross-border operations. Practitioners should also therefore refer to the websites of the respective devolved administrations for further information.
Errors and omissions on Furlough claims
There has been some confusion about employers’ ability to be able to amend furlough claims through the portal either because of a typing mistake, a miscalculation or an omission. On 11 May, HMRC released the following statement:
“We understand that sometimes you might make an error in your claim, and we’re working on a process to enable you to amend a claim. In the meantime, please don’t amend your next claim to reflect any errors that you may have made in a previous one, as this could delay payment. If we spot an error then, where possible, we’ll contact you or your agent to correct the claim.”
ICAS asked for clarification on this statement following some queries received from members. The response received was as follows:
“If we spot a potential error, we will contact the claimant. However, if the customer knows they have made an error, they should wait for the ‘amend’ facility to be introduced to inform HMRC”. No dates have been stipulated as to when the “amend” facility will become available.
ICAS is pleased that the government has extended the CJRS. This follows a letter from ICAS Chief Executive Bruce Cartwright CA to UK Government on 6 May raising concerns about the phasing out of the CJRS.
Visit the ICAS coronavirus hub – a central source of information and resources for members, practice and business for more information.