HMRC are looking into cases of furlough fraud, here is how you can make sure you are covered

The first amnesty deadline for repaying overclaimed amounts through the Coronavirus Job Retention Scheme has passed and HMRC are now looking into cases of furlough fraud, it is therefore critical that businesses retain proper records of past and future claims should they come under scrutiny. 

The first deadline was 20 October 2020 in respect of claims received before 22 July 2020, for claims received after this date the deadlines for making repayments of amounts incorrectly claimed are 90 days after receipt of the funds.

What records should you keep?

  • The amount claimed and claim period for each employee
  • The claim reference number for the records
  • Calculations in case HMRC need more information about the claim
  • Usual hours worked, including any calculations that were required, for employees flexibly furloughed
  • Actual hours worked for employees flexibly furloughed

It would also be sensible to retain records such as:

  • Evidence that employees furloughed and in respect of whom claims were made, would have continued in employment if the pandemic had not happened
  • Evidence that the appropriate amounts have been paid to furloughed workers
  • Communications with employees notifying them they were being furloughed and the responses from employees providing their agreement
  • Written instructions to furloughed employees confirming the need for them to stop working during the period when they are furloughed
  • Evidence that non-furloughed employees have been made aware that they cannot involve furloughed employees in work
  • Details of the procedures used in managing the changes in the implementation of the scheme from August  
  • Details of the procedures for bringing back employees from furlough

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