Furlough with yearly RTI submissions

[Contreras]

... you will also need to use the CJRS calculator to work out 80% monthly pay..

The CJRS calculator does not work for annual salary. It probably doesn't work for director's NI either.

But assuming no NI then it's hardly rocket science, just divide annual salary by 12 and multiply by 0.8. Part-months are based on the number of days in that month.

*There was a article somewhere that did point out that some with annual salary couldnt furlough as they just missed the march 2020 deadline (this was refering to a true annual pay of just one payment per year not 11 lots of nil and then a single payment)

Except that doesn't make sense. Others here (it seems), and certainly in my case, have had no issues despite genuinely being on the Annual Scheme.

The only plausible reasons for a rejection that I can think of are: nil monthly PAYE submission in Feb, or in the first year of annual PAYE with no submission yet.

[andydd68]

The CJRS calculator does not work for annual salary. It probably doesn't work for director's NI either.

But assuming no NI then it's hardly rocket science, just divide annual salary by 12 and multiply by 0.8. Part-months are based on the number of days in that month.



Except that doesn't make sense. Others here (it seems), and certainly in my case, have had no issues despite genuinely being on the Annual Scheme.

The only plausible reasons for a rejection that I can think of are: nil monthly PAYE submission in Feb, or in the first year of annual PAYE with no submission yet.

It IS more complex than that..as it takes into account holiday pay, the initial calculation used by Xero was incorrect so they then had to put together a how to guide to remedy it, HMRC have just added a feature if youve been overpaid CJRS but it seems nothing if you underclaimed. Ive just used the HMRC Calculator and it seems to work fine for annual pay.

This page deals with the annual pay cut-off issue - "Firstly, many directors in small owner-managed businesses have their salary paid on an annual basis. The Treasury Direction of 15 April requires that, for an employee (including a director) to qualify for the scheme, they must have been on the payroll at 19 March 2020 and have received a payment in the 2019/20 tax year. This means that a payment to the director must have been notified to HMRC via RTI on or before 19 March 2020. In practice, many annual salaries will not have been run by that date, so these directors will be unable to claim under the scheme."

COVID-19: Job Retention Scheme - details for employers | The Association of Taxation Technicians

[Contreras]

It IS more complex than that..as it takes into account holiday pay, the initial calculation used by Xero was incorrect so they then had to put together a how to guide to remedy it, HMRC have just added a feature if youve been overpaid CJRS but it seems nothing if you underclaimed. Ive just used the HMRC Calculator and it seems to work fine for annual pay.

Oh, holiday pay, really?

Feel free to use the CJRS calculator if you want to. I kinda hope the typical contractor co. on minimum salary wouldn't be needing a web app to multiply by 0.8!

Fwiw, it gave me the wrong answer when I tried. HMRC instruction at the time was not to use it for annual scheme (didn't stop me trying though), that's not to say it hasn't been fixed since.

"for an employee (including a director) to qualify for the scheme, they must have been on the payroll at 19 March 2020 and have received a payment in the 2019/20 tax year. "

OK I see, so if your RTI submission is between 20th March and 5th April, then it misses the 19 March deadline and the previous payment would have been in the 2018/19 tax year.

For anyone affected by this it could still be worth pursuing. My accountant advised that some other of their clients had needed to call HMRC (only now I understand why) implying that it was being treated as a technical issue that could be sorted out over the phone.

[andydd68]

Oh, holiday pay, really?

Feel free to use the CJRS calculator if you want to. I kinda hope the typical contractor co. on minimum salary wouldn't be needing a web app to multiply by 0.8!

Fwiw, it gave me the wrong answer when I tried. HMRC instruction at the time was not to use it for annual scheme (didn't stop me trying though), that's not to say it hasn't been fixed since.



OK I see, so if your RTI submission is between 20th March and 5th April, then it misses the 19 March deadline and the previous payment would have been in the 2018/19 tax year.

For anyone affected by this it could still be worth pursuing. My accountant advised that some other of their clients had needed to call HMRC (only now I understand why) implying that it was being treated as a technical issue that could be sorted out over the phone.

The HMRC calc does ask lots of questions but the main part of it is, it asks what you earnt in the same period one year ago and also the whole amount over the last 12 years, which it divides by 12 and chooses the greater.

Yeah holiday pay does have an effect as does weekends and bank holidays (Xero for example asks you to choose their No bank holiday settings), I expect for most of us here it has no effect but it could do if you are someone who regularly works weekends and/or bank hols.

I think Martin Lewis did a bit on annual RI submissions ?, I read a good piece somewhere but cant find it now