Coronavirus Guidance Update

Coronavirus Guidance 29^th July 2020

HMRC updated its Coronavirus guidance yesterday. There were many minor amendments but two updates were of particular interest.

The first document relates to remedying errors – see link – If you have claimed too much or not enough from the Coronavirus Job Retention Scheme

It comments:

If you’ve claimed too much

If you want to delete a claim in the online service, you must do this within 72 hours.

If you have made an error in a claim that means you have received too much, you must pay this back to HMRC. You can either:

• tell us as part of your next online claim (your new claim will be reduced and you’ll need to keep a record of the adjustment for 6 years)
• contact HMRC to pay the money back (you should only do this if you’re not submitting another claim)

If you have over claimed a grant and have not repaid it, you must notify HMRC by the latest of either:

• 90 days after the date you received the grant you were not entitled to
• 90 days after the date you received the grant that you were no longer entitled to keep because your circumstances changed
• 20 October 2020

If you do not do this, you may have to pay a penalty. If you do repay any over claimed grant, this will prevent any potential tax liability in respect of the overpayment of Coronavirus Job Retention Scheme. We will not be actively looking for innocent errors in our compliance approach.

If you have not claimed enough

If you have made an error that has resulted in receiving too little money, you will still need to ensure you pay your employees the correct amount. You should contact HMRC to amend your claim. As you are increasing the amount of your claim, we may need to conduct additional checks.

After 31 July, you will no longer be able to amend a claim relating to the period up to 30 June to add an employee that should have been included on a claim submitted before that date. You must make sure that any remaining claims still to be made for the period to 30 June include all of your eligible employees. Amendments for any other errors you made that resulted in you not claiming enough will still be permitted after 31 July.

The second document relates to matters that are more serious; claims where you are not entitled – see link –Coronavirus Job Retention Scheme – receiving grants you were not entitled to

Both the first and second guidance documents state that we will not be actively looking for innocent errors in our compliance approach but this second document focuses on notifying HMRC of grants that were received incorrectly.

It refers to a number of sanctions;

1. The collection of the overpayment by tax assessment

 

2. The recovery of overpayment from individuals where companies become insolvent where the claim can be proven to have been deliberately incorrect or the funds misapplied

 

3. The recovery of overpayments from any one partner in a partnership (joint and several liability)

 

4. Penalties of up to 100%

 

5. Publication of the names of deliberate defaulters

 

6. Prosecution

Comment

Without the furlough scheme, the UK economy would have crashed and it would take many years to recover. The payments made by HMRC are and have been a lifeline. Innocent errors will be tolerated provided monies are repaid (we will not be actively looking for innocent errors in our compliance approach) but negligent, reckless or deliberate claims to recover monies that are unjustified will be rightly punished.

 

Please contact ASE (Martin.Redfern@ase-global.com, Michelle.Malone@ase-global.com or Chris.Cummings@ase-global.com) if you are concerned about your furlough claims – a simple review may provide you with reassurance that your claims are correct and avoid unnecessary issues with HMRC at a later date.

If you need any further details please visit our LinkedIn page for more info:https://www.linkedin.com/company/ase-plc/