Details of latest CJRS ‘furlough’ grant
May 12, 2021
The fourth version of the CJRS ‘furlough’ grant scheme started on 1 May 2021 and will run until 30 September. Any affected employees will continue to be entitled to receive at least 80% of their ‘usual pay’ for hours not worked, subject to a limit of £2,500 per month.
The government, via HMRC, will continue to cover the costs of up to 80% of usual pay for the months of May and June. Government support then reduces to 70% for July and the 60% for August and September, with the employer being required to make up the difference. The employer is also required to pay National Insurance contributions and pension contributions on the full amount paid to the employee.
Furlough eligibility from 1 May 2021
In order to be included in a CJRS ‘furlough’ grant claim for periods after 1 May 2021, an employee must have been on the payroll and subject to an RTI (real time information) submission between 20 March 2020 and 2 March 2021.
The claim calculation continues to be complex, and you need to be careful when computing an employee’s ‘usual pay’ and ‘usual hours’, particularly where the hours and pay varies. Furloughed hours for the grant claim continue to be the difference between the employee’s usual hours and hours worked in the claim period.
In order to qualify for the first and second CJRS furlough support grants, an employee needed to be included in an RTI submission for 2019/20 by 19 March. If that employee continues to be employed, then their ‘usual pay’ for the next version of CJRS continues to be that same amount, even where they have had a pay rise.
Those who failed the original eligibility test, but were on the payroll and subject to an RTI submission before 30 October 2020, were eligible for the third version of furlough that started on 1 November 2020. If that employee continues to be employed, then their usual pay for the next version of CJRS continues to be that same amount, again even where they have had a pay rise.
For employees on fixed pay who were first reported through RTI between 31 October 2020 and 2 March 2021, the ‘usual pay’ is based on the last pay period ending on or before 2 March 2021. For those on variable pay, you need to calculate 80% of the average wages payable between 6 April 2020 (or, if later, the date the employment started) and the date before they were first furloughed on or after 1 May 2021.
These grant calculations certainly aren’t getting any simpler! If we can be of assistance in helping you with your claims then please do get in touch. Note that HMRC may investigate and impose penalties on employers who have over-claimed, even for careless errors.