How do the new furlough rules work?
Over the last few weeks, I have spoken to many of my clients and other business owners who are keen to get the appropriate advice and support on the furlough changes. One of the most common questions I am asked is around what the latest rules are and what can I claim for. Here is what you need to know, but please get in touch as it is vitally important to get it right.
Review the key things you should already have in place – do not guess or even worse bury your head in the sand. Review your cash position and know how profitable your business is right now and in the next couple of months to show you the reality of your solvency position. Ask yourself the question ‘Are you able to pay your liabilities and survive’? It is vital to know where you hit your cash pain points and your breakeven point.
Who and when are you and your staff working?
If you currently have employees on furlough from 1st July 2020 these are the changes. You can ease furloughed employees back to work part time as you are now able to include all full time and flexible furloughed employees in each claim.
You will no longer need to tell HMRC the start date of your claim. If this is your first claim in the month, the start date will be the 1st of the month. If this is not your first claim in the month, then this claim will start the date after the last claim ended.
You will not be able to make a claim that covers more than one month.
If you are making multiple claims in a month, each claim period must be at least 7 days long. If you are unable to make a claim of at least 7 days at the end of the month, then your claim must be split across the end of this month, and the beginning of the next month. In this case, you can make a claim for less than 7 days, but only if the claims are made in consecutive order. You can make multiple claims of 7 days or more within a month, but not the same or overlapping claim dates.
I am talking to all my clients early to submit any July 2020 furlough claims from today, 17th July 2020 to HMRC to enable them to receive the HMRC Job Retention Scheme grant, subject to checks by the end of the month to help with cash flow. My advice is to communicate with your Accountant or Payroll provider early to avoid making the wrong decisions.
Fiscal Business Services Ltd
07403 216682/01793 915050