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CLiP IT Solutions

    
CLiP IT Solutions Ltd
Construction Industry Accounts

phone: 01935 443 340
email: support@clipitsolutions.co.uk
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Guidance for Coronavirus Job Retention Scheme and SSP from Day 1

As you are aware the Government are issuing information daily regarding COVID-19. It has now been confirmed that Employers can use a portal to claim for 80% of an employee’s usual monthly wage costs, up to £2500 a month, plus the associated Employers National Insurance and the minimum automatic enrolment Employer Pension Contribution on that wage. Employer minimum contribution is currently 3%. The online service to make claims is not currently available. However, it is expected to be so towards the end of April 2020.

To view the information made available for the Coronavirus Job Retention Scheme, to identify if you are eligible and what employees you can claim for, please follow this link:- https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

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At this time, we are not aware if changes will need to be made within payroll software or if HMRC will deal with all claims via an online portal available via your HMRC Login. We want to assure you though, that as soon as we receive guidance that changes are necessary, we will implement these and release an update.

Until we get this information, We wanted to advise you of a way to make payments to employees using our PAYE Plus software.

 

Coronavirus Job Retention Scheme (Furloughed Workers)

Follow the steps below within CIA and PAYE Plus to create the necessary codes to enable payment and to make it easily identifiable as to the amounts needed to be claimed when the service is available from HMRC.

Within CIA:-

  1. Nominal> Nominals and Groups - Create two new nominal codes for Furlough Pay and Furlough Employers NI, these should both be Balance Sheet nominals and Current Liability group. Tick Journal Entries when setting up.

  1. You may also wish to create a new nominal code for Furlough Employer Pension Contribution, If so, this will be the same as step 1.

Within PAYE Plus:-

  1. Company> Departments - Create a Department for Furlough and set the Gross Pay nominal and Employer NI nominal as those created within CIA (Step 1). Set the Security level the same as the Department this is replacing. If you run more than one payroll i.e. Monthly and Weekly, you may wish to set more than one Furlough Department. If so, the Department codes will need to be different.

  1. Company> Pay Codes - Create a Pay Code FURLOUGH with a description Furlough Pay, or Coronavirus Job Retention Scheme, or a description you wish to appear on the payslips. You may need to setup more than one pay code depending on the type of payments you make. i.e FUROFF / FURSITE if some employees are paid rates of pay and others fixed amounts. Enter the nominal created for Furlough Pay. These codes need to be setup in the same way as your existing codes that you wish to pay 80% of. i.e. Taxable, NIable, etc.

  1. If you created a nominal code for Furlough Employer Pension Contribution, you will need to either edit your existing pay code and change the nominal code, or alternatively, create a new Furlough Employer Pension Contribution pay code. If not all your employees are being made “Furlough” you will need to create a new paycode.

  1. Employee> Employees> Other Details - Edit each employee to be furloughed and change the Department to the Department Code set in step 1.

  1. Employee> Employees> Pay Codes – Add the pay code created in step 2 and enter the calculation of 80% as a Rate or Fixed Amount. If Rate, you may also wish to enter a default quantity. Remember to remove the default quantity against rates of existing codes that the Furlough code is replacing.

  1. Employee> Employees> Pay Codes – If you created a new pay code for Furlough Employer Pension Contribution, you will need to add this code to each furloughed employee and ensure the % is set at 3. Remember to change the existing code to 0%. If you are going to continue using your existing pay code, and you currently contribute more than 3%, you can only claim a maximum contribution of 3%, so therefore you will need to alter your existing % or make your own calculation as to how much you are able to claim.

 

Sick Pay from Day 1

Within CIA:-

  1. Nominal> Nominals and Groups – Create a nominal code for COVID-19 Sick Pay. This should be a Balance Sheet and Current Liability group.

Within PAYE Plus:-

  1. Company> Pay Codes – Create a pay code COVID19 with a description of COVID-19 Sick Pay or COVID-19 Self Isolation Sick Pay, whichever you prefer to display on the payslip. Set as a Rate, Payment, Taxable, NIable, tick the box labelled SSP, allocate the nominal as set in CIA (Step 1).

  1. Employee> Employees> Pay Codes – Add the pay code to employees as required. The rate up to 05/04/2020 is £18.85 per day and from 06/04/2020 will be £19.17 per day. This is for a 5 day working week, payment totalling £94.25 and £95.85 accordingly.

Currently there is no facility to claim this back, but by following the above it will be easily identifiable how much to claim when HMRC have the procedure in place to do so.

If you have any questions or are unsure how to follow these suggestions, please contact our Support Department on 01935 443340.

A further link regarding COVID-19 information is as follows:-

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses

 

CLiP IT Solutions Limited
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