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 1st 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 1st to end of July, enter the dates 1st – 31st 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%
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%