Flexible furlough scheme opens on 1 July
30 June: Employers will be able to make claims for grants under the flexible furlough scheme (CJRS V2) from 1 July 2020. ICAEW’s Tax Faculty highlights key points and updates its guidance.
The first version of the Coronavirus Job Retention Scheme (CJRS), whereby employees had to be furloughed full time, ends on Tuesday 30 June 2020 and the deadline for claims is 31 July 2020.
Before HMRC published its full guidance there were suggestions that employers would have to make a CJRS V1 claim by 30 June 2020 to qualify to receive CJRS V2 grants. This is not the case; all businesses have until 31 July to claim CJRS V1 grants.
The key changes for CJRS V2 are:
- CJRS V2 is only available to employers that have made claims for grants under CJRS V1.
- CJRS V2 is only available for employees that were furloughed under CJRS V1, with some exceptions for employees returning to work after parental leave and military reservists.
- For CJRS V2 there is a new limit to the number of employees who can be included in a single claim. This is set at the maximum number ever claimed for in a single claim for that payroll in CJRS V1.
ICAEW has clarified guidance which some members had misinterpreted as meaning that this cap applies from 1 July to clarify that the cap applies to CJRS V2 claims.
- Employees can be flexibly furloughed, enabling part-time working.
- There is no minimum furlough period.
- Furlough claims must contain details of usual hours and actual hours worked. Furloughed hours is the difference between these. Unfortunately HMRC has not yet responded to requests for clarification of how usual hours should be calculated
- Each claim made by an employer must be for a week or more unless the claims for an ‘orphan period’ at the beginning or end of a month.
- No claim period can extend across a calendar month end which in some cases will mean that pay periods will have to be split with separate claims for different parts of the pay period.
- 30 November 2020 is expected to be the final date for submitting claims under CJRS V2.
On 25 June, the Chancellor made a further Treasury Direction under Sections 71 and 76 of the Coronavirus Act 2020 to give effect to the extension to the scheme to 31 October and the changes to the terms of the scheme.
- You can access detailed guidance on CJRS V2 on icaew.com/cjrs.