HMRC targets employers over furlough claims

HMRC has written to employers who it believes have overclaimed on the coronavirus job retention scheme (CJRS), demanding they repay payments or face a fine.


HMRC revealed 3,000 employers, out of 1.2 million who have applied for the grant during the COVID-19 pandemic, that it believes have miscalculated their claim.


The news comes as the tax authority told MPs on the public accounts committee that it estimates between 5% and 10% of furlough money has been wrongly awarded.


The scheme, which was launched earlier this year amid the COVID-19 pandemic, has cost the government around £35.4bn, according to the latest data.


HMRC revealed somewhere between £1.75 billion and £3.5 billion could have been wrongly paid out. It also reported an estimated £30 billion in tax was lost in 2019 due to taxpayer errors and fraud.


Under the scheme, from 1 March, companies could claim a grant covering 80% of their employees’ wages on furlough, subject to a cap of £2,500 a month, reducing to 60% at the start of October and closing on 31 October 2020.