There’s no denying that the government’s furlough scheme has been a lifeline for both employers and workers. As we’ve battled through Covid-19 restrictions over the last year, the scheme has kept millions of jobs open and viable. However, it will come as no surprise that many firms have made genuine mistakes when claiming up to 80% of their employees’ salaries. That’s why it’s so important that you check for furlough errors as soon as possible. It’s much better to fix the problem now instead of waiting for the taxman to come knocking.
How common are furlough claim errors?
It’s not easy to say how common furlough errors are. However, research by Grant Thornton has found that 16% of mid-sized businesses have yet to review their initial furlough claims for accuracy. Of those that have reviewed their initial claim, 13% have found errors that need correcting.
So, if these statistics are anything to go by, there’s over a 1 in 10 chance that your furlough claims are inaccurate. If you haven’t reviewed your claims, that’s a strong argument for doing so as soon as possible.
What happens if I’ve made furlough errors?
If you have made furlough errors, the worst thing you can do is ignore them. As reported by Accountancy Daily, the government is investing over £100m in a dedicated taskforce to tackle COVID-19 fraud. 1,265 HMRC staff will be raking through claims for both the furlough scheme and the Self Employment Income Support Scheme (SEISS). We’ve already reported how HMRC has already been making virtual visits to check claims.
This means there is a very strong chance that HMRC will review your furlough claims. If you’ve made errors – even if in good faith – you could be hit by penalties. You could also be forced to pay back wrongly claimed money.
How do I check my furlough claims?
Since the beginning of the pandemic, the furlough scheme has changed three times. This has meant that eligibility criteria have changed over the course of the pandemic. As a result, it’s essential to review your claims in the light of the criteria that applied at the time. It’s worth doing this now while the claims and the criteria are still relatively fresh in your mind.
If the thought of reviewing your furlough claims for errors gives your the horrors, don’t worry. If you are a THP client, we should be able to do this for you. Simply get in touch with your account manager to discuss this further.
What if I do find furlough errors?
If you do find furlough claim errors, the best plan is to tell HMRC straight away. If you alert them to an honest mistake, they are likely to take a much more generous view with regard to penalties and repayments. You can call HMRC’s COVID-19 helpline on 0800 024 1222. It’s open between 8am and 4pm, Monday to Friday.
About Samantha Rowe
Sam’s title is Operations Manager, but the title itself doesn’t truly convey the variety of what she does for THP. From administrative tasks to payroll, strategic business planning, and office systems and procedures, Sam’s primary skill lies in multitasking.
Sam’s journey began as an office junior with George Nottage (now merged with THP), and she soon learned skills in payroll and bookkeeping, and then gained experience as a PA to the Directors, and as Administration Manager.
At the moment, Auto Enrolment is an area that has a key focus for Sam, and for THP as a whole. “The question I’m asked the most by clients just now is, ‘How will auto enrolment affect me?’ And the answer is, no matter how big or small you are, you will absolutely be affected by the Auto Enrolment regulations. I’d encourage you to start thinking about it now, and to look at your payroll software to make sure you’re ready.”