Quick links

  • Who can claim
  • How much can you claim?
  • When can we start claiming?
  • What do we need to claim?
  • What do we do after we've claimed?
  • What happens when the Government ends the scheme?
  • Is it a grant or a loan?
  • Can the agency worker put themselves on furlough?
  • How long can we keep workers on furlough?
  • Employer National Insurance and Pension Contributions
  • What if the subsidy is less than the minimum wage? Do we have to top it up?

Who can claim

  • Businesses, charities, recruitment agencies (agency workers paid through PAYE) and public authorities
  • You must have created and started a PAYE payroll scheme on or before 28 February 2020.

How much can you claim?

  • HMRC will reimburse 80% of furloughed workers’ wage costs, up to a cap of £2,500 (gross) per worker per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer contributions on that wage.
  • Fees, commission and bonuses cannot be claimed for.
  • For employees whose pay varies (for example because they work shifts) you can claim for the higher of either:
    - the same month’s earning from the previous year
    - average monthly earnings from the 2019-20 year
  • If an employee with variable pay has been employed for less than a year, you can claim for an average of their monthly earnings since they started work. If the worker only started in February 2020, you should use a pro-rata approach.

Is it a grant or a loan?

  • It will be a grant, not a loan, so it will not need to be repaid. 
  • Payments received by a business under the scheme must, however, be included as income in its calculation of taxable profits for Income Tax and Corporation Tax purposes - although businesses can continue to deduct employment costs as normal.

When can we start claiming?

  • The subsidy applies from when an employee is placed on furlough. 
  • Claims can be backdated until the 1 March if applicable.

What do we need to claim?

To claim, you will need:

  • your ePAYE reference number
  • the number of employees being furloughed
  • the claim period (start and end date)
  • amount claimed (per the minimum length of furloughing of 3 weeks)
  • your bank account number and sort code
  • your contact name
  • your phone number

You will need to calculate the amount you are claiming. HMRC will retain the right to retrospectively audit all aspects of your claim.

What do we do after we’ve claimed?

  • Once HMRC have received your claim and you are eligible for the grant, they will pay it via BACS payment to a UK bank account.
  • You should make your claim in accordance with actual payroll amounts at the point at which you run your payroll or in advance of an imminent payroll.
  • You must pay the employee all the grant you receive for their gross pay, no fees can be charged from the money that is granted. You can choose to top up the employee’s salary, but you do not have to.

What happens when the Government ends the scheme?

  • When the government ends the scheme, you must make a decision, depending on your circumstances, as to whether employees can return to their duties. If not, it may be necessary to consider termination of employment (redundancy).

Can the agency worker put themselves on furlough?

  • No. You, as the employer, need to designate them as furloughed.

How long can we keep workers on furlough?

  • The minimum length of furloughing is three weeks. 
  • An employee can however be furloughed multiple times, subject to the minimum time period of three weeks, as often as the employer and employee agree.
  • The scheme will be open for an initial period of three months (1 March to 31 May 2020) but it might be extended.

Employer National Insurance and Pension Contributions

  • All employers remain liable for associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on behalf of their furloughed employees.
  • You can claim a grant from HMRC to cover wages for a furloughed employee, equal to the lower of 80% of an employee’s regular salary or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on paying those wages.
  • You can choose to provide top-up salary in addition to the grant. Employer National Insurance Contributions and automatic enrolment contribution on any additional top-up salary will not be funded through this scheme. 
  • Nor will any voluntary automatic enrolment contributions above the minimum mandatory employer contribution of 3% of income above the lower limit of qualifying earnings (which is £512 per month until 5th April and will be £520 per month from 6th April 2020 onwards).

What if the subsidy is less than the minimum wage? Do we have to top it up?

  • No. Workers are only entitled to the National Minimum Wage/National Living Wage for the hours they are working. 
  • You do not need to ensure that they are receiving NMW/NLW rates while on furlough.
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