As we come to the end of another month dealing with all the ramifications of Covid-19 – both personal and business – we have some more updates for you about the various arrangement the government has put in place to help businesses cope.
Furlough – Coronavirus Job Retention Scheme
The Flexible Furlough scheme is being introduced from 1st July 2020, which means employers can start bringing their employees back part time. The hours or days that the employees work is for the employer and employee to decide and employees can stay completely on furlough if required. The business should pay the employee for the hours worked and then apply to the scheme for the hours on furlough.
This adds a bit more complexity for employers so even if you have been managing your payroll yourself up to now but find you need a bit of extra help now, just get in touch.
Statutory Sick Pay Rebate scheme
This scheme allows small to medium size businesses claim back the costs of SSP and is now open for claims. We have been handling the rebates for our clients but this page of the government website has useful information and you can find out if you are eligible to make a claim.
Because people have either been on furlough or working from home, some aspects of taxation have needed some new arrangements although you may not have seen them discussed at the daily Downing Street briefing.
When employees receive benefits from their employer such as meals, company cars or travel costs, they are all considered as part of that employee’s overall taxation. Since employees have either been on furlough or working from home – so there’s a company car on the drive not being used for business purposes for example – HMRC has published new guidance on what to do in these circumstances.
The guidance can be found here.
Calculating maternity and parental pay
The amount of maternity and parental pay is calculated based on the Average Weekly Earnings (AWE) in the 8 weeks prior to the leave starting. Due to furlough, these amounts may have been reduced for some and so new rules have been introduced to ensure no one loses out due to the pandemic.
So, if an employee was on furlough for part or all of the relevant 8 week period and their period of family-related pay starts on or after 25th April 2020, these are the new rules for calculating AWE:
The earnings used to calculate AWE for that period will be the higher of:
- What they actually receive from their employer;
or b) What they would have received from their employer had they not been on furlough
As with other payroll matters, if you are at all unsure about calculating family-related pay for your employees, please just ask.
HMRC are reporting that criminals and scammers are taking advantage of the current situation and so are asking everyone to be on alert. The scammers text, email or phone businesses offering spurious financial support or tax refunds. They try to get financial and personal information or attempt to infiltrate computer systems to steal data or demand ransom. HMRC has detected more than 95 Covid-related financial scams since March, most by text message.
HMRC’s advice to businesses is:
Stop: If you receive a request to make an urgent payment, change supplier bank details, or provide financial information, take a moment to stop and think.
Challenge: Could it be fake? Verify all payments and supplier details directly with the company on a known phone number or in person first.
Check GOV.UK for information on how to recognise genuine HMRC contact and how to avoid and report scams. If you think you have received an HMRC-related phishing/bogus email or text message, you can check it against examples published here.
These are still uncertain times and whilst there are signs that lockdown is easing, we know many businesses still have staff on furlough and are unsure about what the future holds. If you need any help or advice regarding payroll, bringing staff back to work or taking on new employees, just get in touch.
Protect: Contact your business’ bank immediately if you think you’ve been defrauded and report it to Action Fraud. Use the latest software, apps and operating systems on your phone, tablet or laptop. Update these regularly or set your devices to automatically update. Forward suspicious emails claiming to be from HMRC to firstname.lastname@example.org and texts to 60599.