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HMRC Are On The Look Out For Furlough Fraud

Have you accidentally overclaimed?

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Posted by Helen Beaumont on 26/08/2020 @ 8:00AM

Many small businesses are worried about the possible penalties from accidental furlough fraud, so how can you avoid it, and will you have to pay back HMRC if you overclaimed in error?

Are you worried you may have committed furlough fraud?

Are you worried you may have committed furlough fraud?

copyright: rostislavsedlacek / 123rf

The Government has been very supportive of employers who needed to furlough some or all of their staff during the lockdown. However, it has now explained what constitutes overclaimed CJRS grants and what actions it considers could lead to furlough fraud.

This comes down to one of two circumstances:

  • any amount the employer was not entitled to claim

  • any amount the employer is no longer entitled to, but still claimed for

An example would be of an employee who left the company whilst furloughed, where the former employer is still claiming for them under CJRS.

HMRC has stated that it is not obliged to investigate genuine and innocent errors, as long as the payments are repaid within 12-months of the end of their accounting period, but it is actively looking for non-compliance by employers and will not hesitate to apply major penalties where it sees fit.

"Employers names may be published where a deliberate overclaim was made!"

If you have made an incorrect claim under CJRS, you can make a direct payment back to HMRC (if you do not intend to claim again) or adjust your next claim accordingly to account for the error. Either way, ensure you notify HMRC of the overpayment and how you are remedying the situation.

And always keep detailed records of your claims, just in case.

Until next time ...



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About Helen Beaumont ...


Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.

Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.

When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.