Guidance

Coronavirus Job Retention Scheme – receiving grants you were not entitled to (CC-FS48)

Updated 31 May 2022

This factsheet contains information about the recovery of overclaimed Coronavirus Job Retention Scheme (CJRS) grants. It also tells you about the penalties we can charge.

An overclaimed CJRS grant includes any amount of a grant which:

• you were not entitled to receive
• you were no longer entitled to keep after your circumstances changed – for example, if you continued to receive a CJRS grant for an employee after they left your employment

When we talk about ‘you’ in the factsheet, this can mean an individual, a partner or a company.

If you need help

If you have any health or personal circumstances that may make it difficult for you to deal with us, please tell the officer who has contacted you. We’ll help you in whatever way we can. For more information, go to www.gov.uk/get-help-hmrc-extra-support

You can also ask someone else to deal with us on your behalf, for example, a professional adviser, friend or relative. We may however still need to talk or write to you directly about some things. If we need to write to you, we’ll send a copy to the person you’ve asked us to deal with. If we need to talk to you, they can be with you when we do, if you prefer.

Paying back amounts you’ve overclaimed

We understand that mistakes can happen, particularly given recent circumstances. We’ve made it as easy as possible to pay back any amounts of CJRS grants you’ve claimed that you were not entitled to.

If you received too much because you made an error in a claim, you must pay this back to us. To find out more, go to www.gov.uk and search for ‘pay back Coronavirus Job Retention Scheme’.

Recovering overclaimed amounts

Under the new legislation, we can recover amounts of CJRS grants you’ve overclaimed. We’ll look for incorrect claims and take action to put them right. By paying back any amounts you were not entitled to, you can avoid any tax liability for overclaimed CJRS grants.

Our priorities are supporting our customers and tackling deliberate non-compliance and criminal attacks. We’ll not be actively looking for innocent errors in our compliance approach. We will not be actively looking for innocent errors in our compliance approach. We will assess overclaims and charge penalties to support these priorities.

We will not charge you a penalty if you did not know you had overclaimed a CJRS grant:

• at the time you received it
• when your circumstances changed ― meaning when you stopped being entitled to it

and you paid it back within the relevant time period.

If you’re a sole trader or a partner, the relevant time period ends on 31 January 2022. If you’re a company, the relevant time period ends 12 months from the end of your accounting period.

Telling us about a grant you’ve overclaimed

If you’ve overclaimed a CJRS grant and have not repaid it, you need to tell us this within the notification period.

The notification period ends 90 days after the date circumstances changed so that you were no longer entitled to keep the grant.

Assessing the Income Tax charge

To recover the full amount of an overclaimed grant, we can make a tax assessment. We’ll assess the amount that you were not entitled to and have not repaid. If we make an assessment, we’ll write to you about it.

The assessment includes:

• any amounts you have not used to pay furloughed employees’ wages
• related costs within a reasonable period

You must pay any amount we assess within 30 days of the assessment. We’ll charge interest on any late payments. We may also charge late payment penalties if you’ve still not paid the amount 31 days after the due date.

If we have not made an assessment, you must include details of the overclaimed CJRS grant on either the appropriate:

• Corporation Tax return
• Self Assessment tax return

We give more guidance in the tax return notes and helpsheets.

Penalty for not telling us about the Income Tax charge

We may charge you a penalty if you did not tell us within the notification period that you were chargeable to Income Tax on an overclaimed CJRS grant.

When deciding the amount of any penalty, we’ll take account of whether you knew you were entitled to the CJRS grant when:

• you received it
• it became repayable or chargeable to tax because your circumstances changed

If you knew you were not entitled to your grant and did not tell us in the notification period, the law treats your failure as deliberate and concealed. This means we can charge a penalty of up to 100% on the amount of the CJRS grant that you were not entitled to receive or keep.

Appeals

We’ll write and let you know if we:

• make an assessment to recover a grant which you are not entitled to
• charge you a penalty

We’ll give you the reasons for our decision and tell you the amount of tax or penalty due.

If you do not agree with the decision or the amount due, you can appeal. The letter will tell you how. You must do this within 30 days from the date of our letter.

You can find out about appeals in factsheet HMRC1, ‘HM Revenue and Customs decisions — what you can do if you disagree’. Go to www.gov.uk and search for ‘HMRC1’.

If you’re a partnership

If a partnership receives an overclaimed CJRS grant which it does not repay, to collect the amount due as Income Tax, we may assess:

• the relevant partner
• any of the partners

The partners will be jointly and severally liable for the amount assessed.

If the partnership does not repay the amount and we have not issued an assessment, one of the partners must include the Income Tax charge on the appropriate Self Assessment tax return. The other partners will not need to self-assess the amount.

We may assess the relevant partner for the penalty we charge, but all partners are jointly and severally liable for any penalty assessed.

If a company becomes insolvent

If a company is insolvent and we cannot recover the tax it owes, company officers can become personally liable to pay the tax charged on their companies’ overclaimed CJRS grants. This can happen if the company officer knew that the:

• company had overclaimed a CJRS grant at the time it was received
• claim was not used for the intended purpose at the point a tax liability arose

Publishing details of deliberate defaulters

If we charge you a deliberate penalty because of an incorrect CJRS grant claim, we may also consider publishing your details as a deliberate defaulter. For more information, read factsheet CC/FS13, ‘Publishing details of deliberate defaulters’. Go to www.gov.uk and search for ‘CC/FS13’.

More information

This factsheet is one of a series. For the full list, go to www.gov.uk and search for ‘HMRC compliance checks factsheets’.

For more information about:

• inaccuracy penalties — read CC/FS7a, ‘Penalties for inaccuracies in returns and documents’
• failure to notify penalties — read CC/FS11a, ‘Coronavirus support payments — penalties for failure to notify’

Go to www.gov.uk and search for ‘CC/FS7a’ or ‘CC/FS11a’.

If you are not happy with our service

Tell the person or office you’ve been dealing with. They’ll try to put things right. If you’re still not happy, they’ll tell you how to make a formal complaint.

Our privacy notice

Our privacy notice sets out the standards that you can expect from us when we ask for information or hold information about you. Go to www.gov.uk and search for ‘HMRC Privacy Notice’.