HMRC Publishes Data On Furlough Claims

For many companies, the Coronavirus Job Retention Scheme (CJRS) has been a lifeline during the pandemic. The UK Chancellor, Rishi Sunak, recently confirmed that it has been extended for an extra month until 30th April 2021 and this means that the scheme is set to run for over a year, having been introduced on 20th April 2020.

 However, in a move to combat fraud, Rishi Sunak has ordered HM Revenue & Customs (HMRC) to publish details of companies that have made claims through the scheme and these have recently been published online showing records for claims in December 2020. It will be uncomfortable reading for some, as although the scheme has undoubtedly been a brilliant way to keep many firms afloat during these incredibly difficult times, it has also been open to abuse.

 Over the course of the year, a significant number of well-known firms have publicly announced that they already have or will repay furlough cash, including the major food retailers, TESCO, Asda, Morrison’s and Sainsbury’s, online fashion retailer ASOS, Taylor Wimpey, Ikea, Compass and Primark. For all of the businesses that have suffered, notably within travel and hospitality, there have been others that have seen profits boom with the huge rise in online shopping and door-step deliveries. For example, online beauty retailer Cult Beauty reported a staggering 107% growth in sales in 2020.

 The January publication of the list of December claimants showed the employer name attached to the qualifying PAYE scheme, however from February, this will also show an indication of the value of each claim within a banded range.

 The publication of these details has had the effect of making employers think twice about submitting a claim under the extended CJRS, even when they are technically eligible, to avoid the unwanted publicity appearing on the list may garner. This is particularly the case if the business is continuing to operate with a profit when many businesses have been forced to close.

 HMRC will be able to recoup money from employers that haven’t used the scheme properly. There will be an “amnesty” of 90 days where employers can get in touch with HMRC about any miscalculations, and they won’t be subject to any financial penalty. However, if not, HMRC can impose a tax charge equivalent of up to 100% of the grant to which any recipient was not entitled and was not repaid.