WFM UK: Flexible Furlough: CJRS2 Claims

Flexible Furlough – Coronavirus Job Retention Scheme 2 Claims

The HMRC’s flexible furlough claim portal is now live. This article shows how the new claim export works, and how it can be used to make the claim to HMRC. 

July Claim Export

A new export has been created to be used for any furlough claims from 1^st July onwards. Further information can be found here: WFM Release Note - Employer Claim Export – July 2020 Onwards

The export will calculate the total claim amount, including both Employer’s National Insurance and Pension Contributions when run for July. 

• To run the new export, go to Payroll module > Reports > Exports > Furlough Payments (July 2020): By whole month date range
• When running the export for July, the date range must relate to the July claim period
• If the claim period is 1^st to end of July, enter the dates 1^st – 31^st July
• If there will be two claims for July, enter the July dates that are being claimed for 

Using the Claim Export

For the export to calculate the claim amount, the following information needs to be available: 

• Furlough amount paid to employee using a payment type flagged as a ‘furlough payment’
• Usual Hours Worked
• Actual Hours Worked

The furlough amount should be calculated according to the guidance available (see WFM CALCULATING FURLOUGH PAY ARTICLE) and be paid to employees through their appropriate payslip. 

Usual Hours – the export will calculate the usual hours based on either the average for the tax year 2019/2020 or the same period, previous year – whichever is highest. However, if the usual hours are over-ridden, this amount will take priority and be used in the claim export. 

Actual Hours – the export will use the data that is entered in the rota to calculate actual hours. For employees not in the rota, or to override the data, actual hours can be uploaded which will take priority and be used in the claim export. 

More information on how to upload usual and actual hours can be found here: WFM Release Note - Upload Usual and Actual Hours for Flexible Furlough Claims 

How the Claim Export Calculates

The claim export uses the calculations set out in the guidelines published by HMRC here: https://www.gov.uk/guidance/calculate-how-much-you-can-claim-using-the-coronavirus-job-retention-scheme

Furlough Pay Calculation

To calculate the furlough pay amount to be used in a claim, it will take the total amount that has been entered into the employee’s payslip, divide by the number of days in the pay period, and multiply by the number of days in the claim period.

National Insurance Calculation

The following formula is used to calculate Employer’s National Insurance:

Calculate Furlough Secondary Threshold (ST)

Full ST for period ÷ days in pay period x days in claim period ÷ usual hours x furlough hours

Calculate Furlough NIable Pay

Furlough pay amount – Furlough ST

Calculate Furlough ER NIC Claim Amount

Furlough NIable Pay x 13.8%

Pension Calculation

The following formula is used to calculate the Employer’s Pension.

Calculate Furlough Lower Limit Qualifying Earnings (LLQE)

LLQE for period ÷ days in pay period x days in claim period ÷ usual hours x furlough hours

Calculate Furlough Pensionable Pay

Furlough pay amount – Furlough LLQE

Calculate Furlough ER Pension Claim Amount

Furlough Pensionable Pay x 3%