HM Revenue & Customs (HMRC) has published its further guidance on the extension to furlough leave and flexible furlough leave.
It is important to note that the new measures will be treated as having come into effect from 1 November 2020, meaning that claims for the furlough grant prior to that date will continue to fall under the previous furlough rules that applied up to and including 31 October 2020. Those claims must be submitted before 30 November 2020 (but employers should note that they may be required to contribute towards an employee’s salary for those claims).
As we reported previously, moving forward, the extended furlough scheme will now apply until 31 March 2021, allowing employers to claim a grant to cover 80% of the hours that an employee has not been able to work up to a maximum of £2,500 per month. All employers are eligible to claim it and can place any number of employees on it, provided that they can show that their operations have been affected by COVID-19, that they have a UK bank account and operate a UK PAYE scheme.
Employers will be able to claim for employees who were employed on 30 October 2020, provided that those employees were on a Real Time Information (RTI) submission dated between 20 March 2020 and 30 October 2020. However, the position may change in respect of employees who were re-employed after 23 September 2020 and employers should note that HMRC will be reviewing the scheme in January 2021.
Employees can be furloughed for any length of time and on any working pattern. Their employers can then claim the grant for the hours that the employee has not worked. Importantly, an employee does not need to have been furloughed before 30 October 2020 to be placed on the current furlough extension. However, if employers wish to backdate their claims for the furlough leave grant to 1 November 2020, they must do so by 13 November 2020 at the latest.
Employers must, however, continue to:-
Crucially, employers should be aware that, from December 2020, HMRC will be publishing the names of employers claiming furlough and, where the employer is a company or a Limited Liability Partnership, the company registration number as well. This is to combat fraudulent furlough claims and, in particular, to encourage employees to blow the whistle on employers that are claiming the furlough grant when they should not be.
Moreover, if you have no option but to make redundancies or if employees are leaving you for any other reason (including retirement and resignation) on or after 1 December 2020, then you will not be able to claim for an employee's statutory or contractual notice period. Prior to 1 December 2020, you can only claim for an employee's statutory notice period.
Lastly, employers should note that 31 January 2021 marks the midway point in this extension of furlough, when HMRC will be reviewing its further application.
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