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Furlough Fraud: Further Guidance From The Government

Useful information now CJRS has been extended ...

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POSTED BY ROGER EDDOWES ON 23/11/2020 @ 8:00AM

As the Government announced it as extending the Coronavirus Job Retention Scheme (CJSR), it has also released further guidance on furlough fraud and the penalties that may be due if you do not notify HMRC of any overpayment of grants ...

With CJRS being extended, the Government has released further guidance on furlough fraud!

With CJRS being extended, the Government has released further guidance on furlough fraud!

copyright: elnur / 123rf

Furlough fraud can happen in a number of ways. It's mostly about an employer claiming money it was not entitled to, or a change in the employee roster that wasn't accounted for during a CJRS claim.

"Notify HMRC within 90-days of the overclaim
and no penalties are due!"

The penalties are there for what HMRC considers deliberate behaviour although non-notification of non-deliberate overclaims will also incur a penalty if the employer does not notify HMRC in time.

For non-deliberate, unprompted behaviours:

  • HMRC is notified within 12 months of tax being due = 0% to 30% of the 'potential lost revenue' (PLR – the amount that is unpaid as a result failing to notify)

  • HMRC is notified 12 months or more after-tax was due = 10% to 30% of the PLR

For non-deliberate, prompted behaviours:

  • HMRC is notified within 12 months of tax being due = 10% to 30% of the PLR

  • HMRC is notified 12 months or more after-tax was due = 20% to 30% of the PLR

For deliberate behaviours:

  • Where the notification was unprompted = 20% to 70% of the PLR

  • Where the notification was prompted = 35% to 70% of the PLR

For deliberate and concealed behaviours:

  • Where the notification was unprompted = 30% to 100%

  • Where the notification was prompted = 50% to 100%

The Government emphasises that overclaimed grants must be repaid and this can be done during the next furlough claim or by making a repayment to HMRC directly.

By repaying during the next claim, HMRC will deduct that amount of the overclaim from the current claim payment. You should keep a detailed record of any CJRS claims for the next six years to prove any enquiries from HMRC regarding furlough fraud issues.

Until next time ...

ROGER EDDOWES
Business Godparent

 
 



Would you like to know more?

If anything I've written in this blog post resonates with you and you'd like to discover more about furlough fraud or the CJRS extension in general, call me on 01908 774320, leave a comment below or click here to ping over an email and let's see how I can help you.

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About Roger Eddowes ...

 

Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.

Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.