As the furlough scheme winds down how will you avoid getting wound-up in financial difficulties?
If there's been one word that has never been used as exhaustively before, as it has been in the past 18 months, it is furlough. As the furlough retention scheme finishes at the end of September, it brings to a close the temporary release from working for the employee and the temporary release from paying full wages for the employer.
However, for some employees of some businesses, it may not be back to work as before, indeed some personnel could be made redundant. So it is as well for employers to be well prepared if they can't afford to take back all those employees furloughed.
Equally important is to be prepared for any over or under-claim made to HMRC in respect of payments received during the period the scheme has run. HMRC has already restated that it will check all claims. So it is important to make sure that all claims you have made are accurate, with any errors made corrected.
If information remains incorrect when your company makes its next tax return, HMRC could take the view that the error in the claim was 'deliberate' and so penalties may follow.
There is still time to do so and still time to claim money due.
When the furlough scheme ends on September 30th, employers have until October 14th to claim wages for staff who have been put on furlough during that month. Under the initiative, the Government will pay up to £1,875 for each furloughed employee, to cover 60% of their wages during September, with employers contributing 20% of an employee's wages, and having the option of contributing more.
So, if companies are experiencing any financial issues, whether it's a problem in paying wages, not able to pay suppliers on time, or issues with cashflow, directors have 30 days to review the financial position and to seek best advice about the options open to them.
At GSM we provide practical and relevant accounting services to suit your business in the here and now, where decisions made today can make all the difference between falling behind the market, keeping-up with the competition, or moving ahead to achieve your ambitions, driving more profit into your business for the future.
To hear how the end of the furlough scheme needn't leave you reeling, contact GSM today so you can build a better business for tomorrow, on 020 7935 3793