HMRC is writing to selected employers to ask them to review their Coronavirus Job Retention Scheme (CJRS) claims.
The letters are causing confusion and alarm among recipients however as they don’t specify what’s wrong with the claim or even which month’s claim is causing the issue.
What does the letter say?
Employers who have received a letter have been told that their claim appears to be incorrect. This could be because employees who are ineligible were included or too much was claimed for another reason. Confusingly, no details are given of how much the overclaim may be or who the potential ineligible employees are.
In order to find out what the error might be or for which claim, employers or their agent (such as an accountant) will have to trawl through the details of every claim submitted from April to August. They will then have to try to identify the one or two potentially ineligible employees and double-check every single furlough calculation.
If this is something you need help with, please get in touch as PKB will be able to help.
Am I likely to receive a letter?
HMRC has said it’s focussing on fraudulent claims rather than cases where innocent mistakes have been made. If you receive a letter, it doesn’t automatically mean HMRC suspects you of fraud, they’re simply trying to identify if an error has been made.
A trigger for these letters could be that the employer was including employees on furlough who were not paid through that PAYE scheme in February or March 2020, but who do qualify as they fall into one of the following exceptions:
- Transferred from another employer under TUPE
- Transferred from another PAYE scheme as a result of a scheme reorganisation
- Returned from parental leave
- Returned from active military service after 10 June
The Revenue says they’ve identified 27,000 CJRS claims where something looks wrong and they’ve initially looked into 11,000 of these.
What should I do if I receive a letter?
If you think your claim is correct, HMRC is asking recipients to call them so they can assign an officer to your case. The letter states that you need to respond by 22 September or a compliance review will be opened which could see you receive a penalty. Despite this, the system for processing CJRS investigations won’t be ready for a few weeks yet. The best thing to do is get in touch with HMRC or your accountant as soon as you receive a letter.
If you think that you did in fact make a mistake with your claim, HMRC asks that you reply by email. You can use the email address in the letter to reply. Further instructions will then be given so you can make a formal disclosure. Please note however that there is still time to make a voluntary correction for claims.
Because this is all a bit contradictory, we strongly advise you to double check any claims as soon as possible. No penalties will be applied if the excess grant is corrected within the later of:
- 90 days from the receipt of the grant
- 20 October 2020
There won’t be a penalty for submitting an inaccurate claim which resulted in a grant that was lower than the employer was entitled to.
While accountants should get a copy of the CJRS compliance letter if one is sent to you, the system doesn’t always work so please send us a copy if you’ve received one. Whether we’ve made your CJRS claim for you or you’ve done it yourself, we can help you if you’ve received a letter.
Please don’t hesitate to get in touch if you’re concerned with any aspect of your claim.
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