HMRC reported that over 67,000 claims from employers were made within 30 minutes of the Coronavirus Job Retention Scheme portal going live earlier this morning.
We were among those submitting early applications and found some critical areas where the HMRC portal is misleading and could result in understating a claim for a company. From our experience, here’s a practical guide on what to look out for and how best to prepare for a successful claim…
- Have all the correct documents prepared in advance – Although the portal offers a choice, before you can start your claim, of identification data for you to enter including company registration number, we found that once you declare that your company submits a tax return, then you cannot proceed without your UTR (Unique Tax Reference), so make sure you have this handy.
- Consider pension contribution calculations carefully – The HMRC has applied a threshold of £520 before you can claim for 3% contributions made.
- Pro-rata calculations for employees furloughed mid-month – For many employees who are paid monthly, the pro-rata calculations if they were furloughed mid-month (or they were immediately furloughed and then subsequently asked to return to work) needs to be the date following their last working day – even if that day is a Saturday or Sunday, i.e. not typically a working day. The furlough calculation is made on absolute calendar days, rather than working days. We would recommend using the HMRC online calculator to validate your claim
- Total amount of claims – We were expecting to have to input all details for every furloughed employee before a claim could be completed and submitted. However, you only need to enter the total amount of the claim, split by Furlough payment, NI and pension and then the full name and NI number for each employee you’re claiming for.
- There’s time to submit your claim and still have funds by the end of the month – It’s possible that the portal will become overwhelmed because of demand. HMRC has advised that the system will be able to process up to 450,000 per hour, but if you’re struggling to submit a claim then try again at a quieter time, outside of normal working hours. HMRC chiefs reassured businesses that claims submitted today, tomorrow or Wednesday should be paid by 30 April, so you do have a bit of flexibility if you can’t submit your application today.