How do I claim furlough pay from HMRC?

MILLIONS of workers have claimed furlough payments from the government after businesses were forced to shut due to lockdown.

But if you’re unable to go back to work or you’re struggling to get your job done with the kids off school due to coronavirus, how can you claim furlough?

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We round-up everything you need to know.

Who can be furloughed and how do I claim my pay?

Chancellor Rishi Sunak first announced in March that the government would introduce emergency furlough measures.

The scheme went live on April 20, although it’s been backdated until March 1, and it’s currently due to end by October.

Any UK employer can apply for the furlough scheme, including businesses, charities, recruitment agencies and public authorities.

Employers such as , Disney and Premier League clubs such as Newcastle are among those to furlough some of their workers.

Under the initiative, workers get paid 80 per cent of their wages by the government – up to £2,500 a month.

The government also covers national insurance and workplace pension contributions on top.

Whether employers top-up workers salaries beyond this is up to them.

To be eligible for the scheme employees must be on their company’s PAYE payroll scheme on or before March 19, 2020, have , and have a UK bank account.

Employers also need to have processed a Real Time Information (RTI) submission notifying payment in respect of that employee to HMRC on or before 19 March 2020.

To access the scheme, your employer must comply with the following:

• Designate employees who cannot do their jobs due to the coronavirus measures put in place by the government
• Notify those employees of their new “furloughed” status
• Submit information to HMRC via its about furloughed employees to set up a system for reimbursement and existing systems that will facilitate payments.

Chancellor Rishi Sunak today announced that the deadline for new employees who can be enrolled on the scheme is June 10.

How is furlough pay calculated?

For most salaried workers, their payments are worked out by taking 80 per cent from their last pay period prior to March 19, before tax is taken off.

If your pay varies, then furlough is calculated depending on which is higher from the following:

• 80 per cent of the same month’s earnings from the previous year, for example April’s payment worked out from April 2019 earnings
• 80 per cent of average monthly earnings from 2019/20 tax year

If the worker has been employed for less than a year, the employer can claim for 80 per cent of their average monthly earnings since they started.

If they have been there for less than a month, a pro-rata amount based on how many days they’ve worked  can be used.

From August 1, employers will be required to pay furloughed staff National Insurance and pension contributions, plus 10 per cent of the their salaries from September.

From October, business will have to pay 20 per cent of furloughed workers’ salaries until the scheme ends in October.

In this case, furloughed employees won’t see a change to their salary as long as they’re not working for their company part-time.

Can I be made redundant on furlough?

Furloughed workers are those who are unable to work due to the coronavirus pandemic because their places of work have been forced to close.

They are not people who have been let go from their jobs – the idea behind furlough is to keep Brits employed, although furloughed workers can still be made redundant.

If you’re made redundant while on furlough, your usual redundancy rights still apply.

Can I take another job while on furlough?

Currently, furloughed staff should not undertake any work for their employer during the scheme.

But they are still able to work for another company or volunteer elsewhere as long as your employer agrees to it and it doesn’t breach your existing contract.

Workers can also do training courses for your current employer while on furlough, but you must be paid your full salary for this.

If your boss wants you to work, you have to be furloughed for at least three weeks before it reemploys you.

And if it furloughs you for subsequent periods, these always have to be for at least three weeks.

However, from July 1, employers can ask workers to return on a part-time basis.

This is completely up to employers but they must pay wages in full for the days worked.

If you’re still struggling with the drop in your income, the Department for Business, Energy and Industrial Strategy says: “If your salary is reduced as a result of these changes, you may be eligible for support through the welfare system, including Universal Credit.”

Do I pay tax on furlough?

Yes, your employer will deduct income tax, employee national insurance contributions, employee pension deductions and any other deductions they would normally make from your wages before you pocket it.