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Coronavirus Job Retention Scheme

Question for Treasury

UIN 157218, tabled on 23 February 2021

To ask the Chancellor of the Exchequer, whether it is his policy that employers may ask furloughed staff to loan the business a proportion of their furlough payment.

Answered on

1 March 2021

Employers are required to pay staff all the Coronavirus Job Retention Scheme (CJRS) grant they receive from HMRC to cover 80% of wages up to £2,500 per month. The employer is still required to meet the employer’s National Insurance and pension contributions.

Employers cannot enter into any transaction with the worker which reduces the wages below the amount claimed. This includes any administration charge, fees or other costs in connection with the employment. Where an employee had authorised their employer to make deductions from their salary, these deductions can continue while the employee is furloughed provided that these deductions are not administration charges, fees or other costs in connection with the employment.

Whether to furlough an employee and claim CJRS support is a matter for the employer, and they will need to discuss and make any changes to their employee’s contract by agreement.

HMRC stand ready to support taxpayers in financial distress as a result of COVID-19, and urge any employers that may be struggling to pay their outstanding tax liabilities to contact HMRC as soon as possible.

HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information, or if payments are not being used as required by the scheme. Employees can report suspected fraud in relation to the CJRS on GOV.UK.

Answered by

Named day
Named day questions only occur in the House of Commons. The MP tabling the question specifies the date on which they should receive an answer. MPs may not table more than five named day questions on a single day.