Coronavirus: Pay Job Retention Scheme grants back
Find out how to pay all or some of your grant back if you’ve overclaimed, or if you do not need the grant and want to make a voluntary repayment
If you’ve claimed too much through the Coronavirus Job Retention Scheme, or you’d like to make a voluntary repayment because you do not want or need the grant to pay your employees’ wages, tax and National Insurance and pension contributions, you can either:
- correct it in your next claim (your new claim will be reduced and you’ll need to keep a record of the adjustment for 6 years)
- get a payment reference number and pay HMRC back within 30 days (only if you’re not correcting it in your next claim)
How to correct overclaims in your next claim
You must follow these steps:
Work out your claim amount as normal. If you submit using a file, do not provide details of the overclaim in that month’s claim file. The file should show the amount of the claim for the employees being claimed for without any offset for the overclaim.
Work out your overclaim amount.
Deduct the amount you’ve overclaimed (step 2) from your claim amount (step 1).
Enter the result in the ‘claim amount’ box on your claim form.
Enter the amount you’ve overclaimed in the ‘overclaim’ box on your claim form.
For example, if your claim amount is £5,000 and you need to repay an overclaim of £1,000, you should enter:
- £4,000 into the ‘claim amount’ box (£5,000 - £1,000)
- £1,000 into the ‘overclaim’ box
How to pay
You must use the online service to get your payment reference number before you can pay HMRC back. You should only do this if you’re not making another claim.
Your payment may be delayed if you use the wrong reference number.
Pay by online or telephone banking, CHAPS and Bacs
You can pay by Faster Payments, CHAPS or Bacs to HMRC’s account.
|Sort code||Account number||Account name|
|08 32 10||12001039||HMRC Cumbernauld|
- Faster Payments (online or telephone banking) usually reach HMRC on the same or next day, including weekends and bank holidays
- CHAPS usually reach HMRC the same working day if you pay within your bank’s processing times
- Bacs usually take 3 working days
Pay by card
You can also pay by debit card or corporate credit card.
If you’ve overclaimed
If you’ve overclaimed a grant and have not repaid it, you must notify HMRC by the latest of (one of the following):
- 90 days after the date you received the grant you were not entitled to
- 90 days after the date you received the grant that you were no longer entitled to keep because your circumstances changed
- 20 October 2020
If you do not do this, you may have to pay a penalty. If you do repay any overclaimed grant, this will prevent any potential tax liability in respect of the overpayment of Coronavirus Job Retention Scheme. HMRC will not be actively looking for innocent errors in their compliance approach.
Find out more about when you may have to pay a penalty and other information, including:
- how HMRC decides how much the penalty will be
- when HMRC will not charge a penalty
- how to appeal against a penalty
Offset an amount you’ve overclaimed
When working out the amount you’ve overclaimed for in a claim period, you can include all employees in that single claim period.
This means if you’ve overclaimed for one employee, you can offset this by an amount, equal to any amounts that you’ve underclaimed for another employee included in the same claim period. You cannot offset an overclaim made in one claim period against an underclaim from another claim period.
Where you have underclaimed for any employee, you must make that value good to the employee. This is because it is a requirement of the Coronavirus Job Retention Scheme that the employee receives a minimum of 80% of reference pay.
You must repay any balancing overclaim after offsets for any period to HMRC.
Example of offsetting an amount you’ve overclaimed
A Ltd claimed £4,000 for 1 June 2021 to 30 June 2021. This comprised of £2,000 for Employee 1 and £2,000 for Employee 2.
A Ltd reviewed the claim after the amendment deadline and identified that Employee 1 should have received £2,500 and Employee 2 should have received £1,500.
The £500 overclaim for Employee 1 can be offset against the £500 underclaim for Employee 2. This means A Ltd does not have an overclaim for the period from 1 June 2021 to 30 June 2021 as long as they pay Employee 1 the additional £500 they should have received in respect of that period.
First published 11 November 2020