Coronavirus: Furlough payments system faces delays

Concerns have been raised over possible payment delays to workers furloughed under the Coronavirus Job Retention Scheme.

The HMRC’s online payment system was due to be fully operational on 20 April.

However, an HMRC communication to tax agents has suggested that, although the online system will launch on time, payments will not begin to flow for a further 10 days.

See also: Coronavirus: Tips to ease VAT cashflow and gain from deferral

The communication added: “We are expecting phone demand to be beyond our capacity to offer a normal service.

“Therefore, the service is designed to be self-serve with guidance in place. Again, your support in helping us achieve this is called on.”

Tax and advisory firm Blick Rothenberg, which received the communication, said the 10-day wait for payment would be a blow to thousands of firms hoping to pay their staff.

Heather Self, a tax partner at the firm, said: “Employers are desperate to get the money into their bank accounts. It now looks as if there will be a further delay until at least the first week of May.”

She added: “HMRC are working hard to get things up and running, but cashflow is critical and employers need certainty.

“Let’s hope the system is ready to go – and robust – next week and is not delayed further.”

Once up and running, the system should be available 24 hours a day, seven days a week, and callers can queue to speak to an adviser.

Payments will normally be processed within four to six working days of the employer’s application, and can be made up to 14 days in advance of the employer’s payroll date.

Reimbursement can be applied for employees furloughed from the start of March 2020 until end of May 2020.

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