HM Revenue & Customs  

HMRC to contact workers in job scheme checks

HMRC to contact workers in job scheme checks
 Credit: Andy Rain

The taxman will write to employees as part of its efforts to unearth fraudulent firms taking advantage of the government's Job Support Scheme.

A fact sheet published by HM Revenue and Customs revealed the government body would be contacting employees directly to inform them of the details of their employers’ claim on their behalf.

It said: “HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information.

“Our intention is that employees will be informed by HMRC directly of full details of the claim.”

The Job Support Scheme was announced by chancellor Rishi Sunak last month as part of the government’s Winter Economy Plan.

From November, the government will contribute towards the wages of employees who are working fewer hours than normal due to decreased demand.

The scheme will only be open to employees who work at least a third of their normal hours. These hours will be paid for by their employer, while the government and the employer will each pay a third of the remaining hours not worked.

That would mean an employee working 33 per cent of their usual hours would receive up to 77 per cent of their normal wages — with businesses footing 55 per cent of those workers' regular salaries.

The level of grant will be calculated based on an employee’s usual salary, capped at £697.92 a month, and firms will not be allowed to make staff redundant while they are on the scheme.

Under the terms of the scheme employers must agree to the new working arrangements with staff, make any changes to the employment contract by agreement and notify the employee in writing. Such agreements must also be made available to HMRC on request.

John Hood, a tax partner at Moore Kingston Smith, said writing to employees directly was a “canny move” by the taxman.

He said: “[This] means employees will effectively be stooges for HMRC. 

“By ensuring employees know what claims their bosses are making under the JSS, HMRC hopes to clamp down on fake claims and uncover ghost employees not employed by the business.”

HMRC said there was "no truth" in the suggestion employees were being used in any way.

The Job Support Scheme will run for six months, starting from November, and all small and medium sized businesses are eligible to apply. Larger businesses will have to show that their turnover has fallen in order to be eligible.

The scheme will replace the Coronavirus Job Retention Scheme — or ‘furlough’ scheme — which closes at the end of October.

HMRC has clamped down on furlough fraud recently, making a number of arrests as part of investigations into suspected offences relating to the scheme.

In July, a Midlands man was arrested on suspicion of a £495,000 furlough fraud while two Londoners were arrested in September as part of an investigation into a £70,000 abuse of the scheme.