HMRC Furlough Compliance Checks
Since its introduction in March 2020, the Coronavirus Job Retention Scheme has been a crucial part in protecting jobs and supporting businesses throughout the pandemic.
When the government made the decision to lock down early last year, the focus was to provide emergency support to businesses as quickly as possible. Due to the urgency, employers were able to request this financial support from HMRC without having to complete compliance checks first. However, HMRC made it clear that organisations will have to complete these checks in the future.
The chancellor announced that a COVID fraud team has been put in place within HMRC. This is due to the estimation that up to 10% of Furlough applications may have been claimed fraudulently. In addition, it’s important you prepare for these HMRC Furlough compliance checks in case future enquiries makes its way to your business.
Are you ready for the HMRC Furlough Compliance Checks?
With restrictions changing regularly throughout the past 17 months, the Job Retention scheme has also gone through changes. In addition, employers were required to apply correctly throughout each change. You may receive a letter from HMRC that requests extensive information on each application and you will have two weeks to submit this. The request will be on a per employee and per wage basis with more information being required for employers that pay weekly compared to monthly. This information can include:
- Employee’s personal information (name, National Insurance Number, and address)
- Claim start date
- Claim end date
- Hours on furlough
- Evidence that the employee received the amount you claimed
- Pension and National Insurance contributions claimed
- Payment calculation information
- Hours worked
You may not receive a request of information from HMRC but we recommend doing the correct checks anyway due to the high level of fraud that has been detected. This means that if HMRC do contact you, you will have all the information ready for them to look over. In addition, you will not only avoid a lot of stress, you will also save money and time in the future.
The Coronavirus Job Retention Scheme Changes
From Sunday 1st August 2021, the government will pay 60% of wages up to a maximum of £1,875 for hours on Furlough. Employers must pay an additional 20% to employees to ensure they receive at least 80% of their usual wages (up to £2,500).
The Coronavirus Job Retention Scheme will end after 30th September 2021. You can find out more about the Coronavirus Job Retention Scheme on the government website now.
If you would like any further information or support on HMRC Furlough compliance checks, contact us now.