HMRC has said that it has made an first arrest in connection with allegations of a £495,000 fraud of the Coronavirus Job Retention Scheme (CJRS).

Although HMRC has said that it considers that the vast majority of employers will have used the CJRS responsibly, it will not hesitate to act on reports of abuse of the scheme.

Nobody who has received a grant should become complacent. Reports of suspected fraud can be made online to HMRC via a very simple process. The rules implementing the CJRS were both complicated and rushed. This creates a risk for businesses that they may have inadvertently failed to comply fully with the rules. Now is the time to perform a root and branch review of the steps put into place when employees were placed on furlough leave.

The types of records HMRC may expect to see include:

  • Documents evidencing the need to place employees on furlough
  • Furlough agreements with employees and subsequent communications
  • Records showing that employees were instructed not to work during furlough leave and that they did not do so
  • Records of correct, accurate and timely payments to furloughed employees
  • Documents showing that furloughed employees would have been likely to have continued in employment had the pandemic not occurred
  • Details of the procedures for bringing back employees from furlough leave.

Not every business will have all the above records. However, what is important is that everything is reviewed and collated now. If HMRC find discrepancies, however honestly they arise, this can often lead to wider enquiries and greater interruption at a time that businesses need it least.

The Furlough Advice & Support Team at Edwin Coe will continue to monitor and report on the situation as it develops.

To review our previous Covid-19 updates, please click here.


Please note that this blog is provided for general information only. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content of this blog.

Edwin Coe LLP is a Limited Liability Partnership, registered in England & Wales (No.OC326366). The Firm is authorised and regulated by the Solicitors Regulation Authority. A list of members of the LLP is available for inspection at our registered office address: 2 Stone Buildings, Lincoln’s Inn, London, WC2A 3TH. “Partner” denotes a member of the LLP or an employee or consultant with the equivalent standing.

Please also see a copy of our terms of use here in respect of our website which apply also to all of our blogs.

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