Furlough scheme: has employers’ NI been overclaimed?
The Institute of Chartered Accountants in England and Wales (ICAEW) has issued new guidance that describes two scenarios where employers using the furlough scheme may have inadvertently reclaimed secondary Class 1 NI twice when the scheme was first introduced. What’s the full story?
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Festive tax breaks for remote workers
You’re familiar with the tax break for Christmas parties but you now have a few remote workers, and the company will need to reimburse their travel and accommodation costs if they attend an event. Which costs count towards the tax-free limit and how can you manage any overspend?
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New process for some exports starting in Northern Ireland
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The Coronavirus Job Retention Scheme (CJRS) is complex, but broadly employers pay a percentage of an employee's regular salary (at least 80% in 2020), subject to a cap, then reclaim the 80% element from HMRC. However, it also allows secondary Class 2 NI contributions to be reclaimed, as well as pension contributions under auto-enrolment. This has led to some scenarios where employers who claim the employment allowance (EA) of up to £4,000 per year inadvertently receiving furlough payments in respect of NI that is also relieved under the EA. The ICAEW has published detailed commentary on where this may have happened. In brief, an overclaim may occur where:
- EA claims were deferred until after the final claim month for the CJRS where the £4,000 was not absorbed in full during 2020/21; or
- EA claims were made at the beginning of the tax year where the full £4,000 was absorbed before July 2020.
Potentially affected business should carefully read the guidance and contact HMRC’s Employer Helpline on 0300 200 3200 if they think there is an issue.
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