The furlough scheme changed from 1st July 2021. As we are now in July it seems a good time for a reminder about how furlough works.

From 1 July 2021, the government will pay 70% of wages up to a maximum cap of £2,187.50 for the hours the employee is on furlough. This has reduced from 80% of wages up to a cap of £2,500.

However employees must still receive at least 80% of their wages up to a cap of £2,500.

Employers must top up employees’ wages to make sure they receive 80% of wages (up to £2,500) in total for the hours the employee is on furlough. The caps are proportional to the hours not worked.

In August and September, the government will pay 60% and employers will pay 20%

Which employees can you claim for?

You can claim for employees who were employed on 2 March 2021, as long as you have made an RTI submission to HMRC between 20 March 2020 and 2 March 2021, notifying a payment of earnings for that employee. You do not need to have previously claimed for an employee before the 2 March 2021 to claim for periods from starting on or after 1 May 2021.

National Insurance and Pension

Employers must meet the cost of employers’ pension and national insurance contributions. These cannot be claimed for under the furlough scheme.

Flexible furlough

Employees don’t have to be 100%  furloughed. They can work some hours and be furloughed for the other hours if needed.

If your employee is flexibly furloughed, you’ll need to work out your employee’s usual hours and record the actual hours they work as well as their furloughed hours for each claim period.

Fully furloughed

 If your employee is fully furloughed, you do not need to work out their usual and furloughed hours. An employee is fully furloughed if they do not do any work for you during the claim period.

Claiming

You can claim on the HMRC website, or your payroll provider might do this for you.

There are deadlines for claiming for each month:

Claim for furlough days in	Claim must be submitted by
June 2021	14 July 2021
July 2021	16 August 2021
August 2021	14 September 2021
September 2021	14 October 2021