It will have come as a relief to many businesses to hear that the Coronavirus Job Retention Scheme (CJRS), known commonly as the Furlough scheme is to be extended until the end of September. But there will be changes from July onwards.
It is surprising that the government has not made it sector specific - for example to cover just those businesses forced to close until June 21st at the earliest - but it will apply to all those currently affected.
HMRC has released further information for employers as follows:
The UK Government will continue to pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month, up to the end of June 2021.
For periods in July, CJRS grants will cover 70% of employees’ usual wages for the hours not worked, up to a cap of £2,187.50. In August and September, this will then reduce to 60% of employees’ usual wages up to a cap of £1,875.
You will need to continue to pay your furloughed employees at least 80% of their usual wages for the hours they do not work during this time, up to a cap of £2,500 per month. This means, for periods between July and September, you will need to fund the difference between this and the CJRS grants yourself. You can also top up wages above the 80% if you wish, but you are not required to do so.
You must continue to pay the associated Employer National Insurance contributions and pension contributions on subsidised furlough pay from your own funds.
CJRS eligibility from May
For periods from 1 May 2021 onwards, you will be able to claim for eligible employees who were employed by you and on your PAYE payroll on 2 March 2021. This means you must have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 2 March 2021, notifying us of earnings for that employee.
You and your employees do not need to have benefitted from the scheme before to make a claim, as long as you meet the eligibility criteria.
For more information on the extension to the scheme and the support available, see https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme