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COVID-19: What to consider when making a Job Retention Scheme claim

What to consider when making a Job Retention Scheme

Caroline Laffey discusses the Job Retention Scheme (JRS) and the key areas to be aware of before submitting a claim.

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Caroline Laffey

Partner, Tax and People Services

KPMG in the UK

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“Preparing a Coronavirus JRS claim is complex and there are key areas to be aware of ahead of submission”

In our latest video, Caroline Laffey, Partner – People Services, provides her insight on what companies should think about when considering the JRS.

Reputation

“As you make decisions, bear in mind that they will, in all likelihood, be judged with the benefit of hindsight and against the actions of your competitors.”

Before making a claim, organisations should consider what it will mean for their brand reputation, what the impact of COVID-19 is on their business and any scrutiny it may bring their way in the future – for example, on executive pay or dividend policy. If, like some employers, you decide to withdraw from the scheme, clearly explain why to protect the credibility of your corporate governance structure.

Keep a record

“Think about who might review your claim.”

Your claims are not limited to review from HMRC. Scrutiny may also come from your auditors, during due diligence in a transaction and even the press. Document all key decisions, who made them and why. 

If you do make a claim, reconcile this to payroll, payments to HMRC and your pension provider. Retain the evidence in a single place and ask somebody to carry out an independent review to check that it will withstand scrutiny.

New guidance

“As new guidance emerges, revisit your claims.”

Monitor your claims and as new guidance emerges identify whether action is needed with regard to recent changes to employer NICs, overtime, commission and allowances. As HMRC has now introduced a process for making amendments where employers have over-claimed, you should consider whether this is appropriate.  We await guidance for employers that have under-claimed.

Communicate with employees 

“Without furlough you have no claim.”

The furlough scheme instructions state that employees on the scheme should cease work and retain evidence that this has happened so that you can prove they were correctly furloughed if later challenged. Communicate with employees, and make sure they are clear on the furlough instructions.

© 2020 KPMG LLP, a UK limited liability partnership, and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved.

KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.

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