The good news for businesses is that, should they need extra support, the Chancellor has extended the furlough scheme. The current system will continue until the 30th of June 2021; then, an altered furlough scheme will be in place until the 30th of September 2021.
What Are The Changes To The Furlough Scheme?
Up until the 30th of June 2021, companies can continue to claim 80% of each furloughed employees usual wages. This will cover the periods that the employee is furloughed and offers up to £2,500 per employee each month.
However, after the 30th of June 2021, a slightly different scheme will be implemented, which will last until the 30th of September 2021. The costs for employees will increase and include the following:
- For pay periods from the 1st of July 2021, the employer can claim up to 70% of their employees’ usual wages up to £2,187.50 per month per employee
- For pay periods from the 1st of August 2021, the employer can claim up to 69% of their employees’ usual wages up to £2,187.50 per month per employee
Regardless of which option chosen, the employer must continue to pay furloughed staff 80% of their usual contracted wages. They must also pay all of the employer’s Class 1 NIC and any pension contributions due on the furloughed wages. If there is not enough money to pay these contributions, employees can be asked to work part-time, then be furloughed for the rest of their usual working hours.
It is important to remain aware that HMRC will now be publishing the names of employers who have used the furlough scheme, as well as an indication of how much was claimed each month. Employees can also check their personal tax account to see if a furlough claim has been made in respect of their wages.