How to prepare for the end of the Coronavirus Job Retention Scheme

The current CJRS is due to end on 30 September 2021 and will not be extended.  Employers should now be reviewing the implication so the scheme ending, with a number of issues to resolve including redundancies, final claims, corrections and post CJRS activities. This article will outline some of the ways in which employers should look to prepare for the end of furlough.

Final CJRS claims and corrections

Furlough claims must be made within 14 days of the end of the calendar month for which you are claiming.  If you realise that you have made a mistake in a claim, this can be corrected within 28 days of claim period end (an adjustment must be made through the online portal to correct your claim, regardless of whether the error results in an under or over claim).

If you have overclaimed, you must notify HMRC directly and make arrangements to make direct repayment to HMRC.  It is a legal requirement to notify HMRC within 90 days of either:

• The date you ceased to be entitled to the payment
• The time the payment is received

After the CJRS

After your last CJRS claim, you should ensure that the payments you have received are declared accurately on your organisation’s tax return, as they are treated as taxable business income.  If you have not corrected any CJRS errors by the time you come to submit your tax returns, it means that you may end up submitting an incorrect return. If you have any questions we are always here to help.

Redundancies

For employers that will not be able to afford or do not need all their staff after the end of the furlough scheme, restructuring plans may need to be put in place.  This is a difficult process and there are many legal processes to follow.  Being on furlough is not supposed to affect an employee’s employment law rights in any way. You will need to think about:

• Ensuring sufficient notice is given to employees.

• Making sure an employee receives the correct amount of redundancy pay and consideration of their statutory entitlement

• Determining the income tax and NIC treatment

If you have any queries about the end of the CJRS please get in touch with your Swindells partner who will be able to advise you further.