Claiming for furlough payments – what you will need
10 April 2020
The furlough payment recovery mechanism is to be launched sometime during the week commencing 20 April, what will employers need to have ready.
Employers must have:
- Created and started a PAYE scheme on or before 28 February 2020 (guidance covers TUPE, change of ownership and payroll consolidation)
- Enrolled for PAYE online (this process can take up to 10 days under normal working conditions)
- A UK bank account
Employers should discuss with their staff and make any changes to the employment contract by agreement. Employers may need to seek legal advice on the process. If sufficient numbers of staff are involved, it may also be necessary to engage collective consultation processes to procure agreement to changes to terms of employment. Employers will need:
- Employer PAYE reference number
- The number of employees being furloughed
- National Insurance Numbers for the employees to furlough
- Names of the employees to furlough
- Payroll/works number for the employees to furlough
- Self Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number
- 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
- Contact name
- Contact phone number
Employers will need to calculate the amount they wish to claim. HMRC will retain the right to retrospectively audit all aspects of the claim.
If an employer uses an agent who is authorised to act for you for PAYE purposes, they will be able to make a claim on their client’s behalf.
If the employer uses a file only agent (who files the RTI return but doesn’t act for their client on any other matters) they won’t be authorised to make a claim. The employer will need to make the claim directly. The file only agent may be able to assist the employer in obtaining the information needed for the claim, as listed above.
Employers should discuss with their agent what services they plan to, or are able to, provide in this situation.
Employers should make their claims using the amounts in their payroll - either shortly before or during running payroll. Claims can be backdated until 1 March where employees have already been furloughed.
If appropriate, worker’s wages should be reduced to 80% of their salary within the payroll before they are paid. This adjustment will not be made by HMRC. Read the guidance for the calculation to use for salaried workers and workers whose pay varies.
Minimum furlough periods
Any employees you place on furlough must be furloughed for a minimum period of 3 consecutive weeks. When they return to work, they must be taken off furlough. Employees can be furloughed multiple times, but each separate instance must be for a minimum period of 3 consecutive weeks.
After making the claim
HMRC will check each claim, and if the employer is eligible, pay it by BACS to a UK bank account.
Read the latest HMRC guidance in full before making a claim.