The Coronavirus Job Retention Scheme enables employers across the UK access to a grant which covers 80 per cent of the wages of staff that would otherwise have been made redundant, up to a maximum of £2,500 per month.
When will furlough money be paid?
Chancellor Rishi Sunak confirmed the furlough scheme is open for applications on Monday (20 Apr), with the system able to process up to 450,000 applications per hour.
Employers should receive the money within six working days of making an application.
Chancellor Sunak said: “Exactly one month ago today I announced the unprecedented decision to step in and help pay people’s wages.
“We promised support would be available by the end of April – today, we deliver our promise.”
Can I still apply for the scheme?
The Treasury has extended the deadline for applications to its furlough scheme in an effort to prevent thousands of workers who are at risk of losing their job.
Initially, individuals had to be employed on 28 February 2020 to qualify for the Coronavirus Job Retention Scheme, but this date has since been extended.
Employers can now claim for furloughed employees who were on their Pay As You Earn (PAYE) payroll on or before 19 March 2020 - the day before the scheme was announced.
Paymaster General Penny Mordaunt apologised the changes had not been made sooner, writing on Twitter: "This will help more people and is very welcome. Sorry it was not done sooner and know how worried people will have been.
"Hope to have an update on other Treasury matters soon."
How do employers access the scheme?
To access the Coronavirus Job Retention Scheme, employers will need to take the following steps:
- Designate affected employees as ‘furloughed workers,’ and notify your employees of this change - changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
- Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month and is working urgently to set up a system for reimbursement.
Existing systems are not set up to facilitate payments to employers.
If your business needs short term cash flow support, you may be eligible for a Coronavirus Business Interruption Loan.
To apply for the scheme, visit access.service.gov.uk.
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