Furlough - Director

Discussion in 'COVID-19 Forum' started by hassecure, Mar 24, 2020.

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  1. hassecure

    hassecure UKBF Newcomer Free Member

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    Hi All
    Sorry if this has previously been asked but i'm lost and confused in all the information that's being released.

    My circumstances are I own a limited business (i'm the sole company director) and working alongside me I have 2 people

    Especially given the advice this evening, I'm unable to operate and will have no choice but to furlough their contracts and put in a claim to HMRC.

    As such a small business we just get along with the cash coming in, so with no work and no cash, I simply don't have the funds.

    I've been advised that even thou I'm an employee of the business, because I am also the sole director I wouldn't be able to furlough my contract and get support for my income

    Does this sound correct?

    Would anyone know I can can claim any sort of support?

    Thanks
     
    Posted: Mar 24, 2020 By: hassecure Member since: Feb 11, 2017
    #1
  2. The Soup Dragon

    The Soup Dragon UKBF Regular Free Member

    101 2
    I have been trying to find this out too as I am in virtually the same situation as yourself myself sole director paid via PAYE and 1 full time employee.
     
    Posted: Mar 24, 2020 By: The Soup Dragon Member since: May 13, 2013
    #2
  3. Mr D

    Mr D UKBF Legend Free Member

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    Your business may get a grant if it has business rates zero'd or payable.
    The business may be able to get a loan from the bank.

    If you cannot work you may be able to get universal credit - expect significant delays for a claim.

    Furlough scheme won't work for you if you cannot pay the funds out. Expect end of April or later to receive money back if you could use it.
    Still details to come on the furlough scheme.
     
    Posted: Mar 24, 2020 By: Mr D Member since: Feb 12, 2017
    #3
  4. The Soup Dragon

    The Soup Dragon UKBF Regular Free Member

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    We get full small business rates relief and are in a very small premises so my understanding is that the council at some point will give us a grant of £10K which we will probably use to pay wages.
     
    Posted: Mar 24, 2020 By: The Soup Dragon Member since: May 13, 2013
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  5. Mr D

    Mr D UKBF Legend Free Member

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    That should happen next month and be done automatically at last info I heard.
     
    Posted: Mar 24, 2020 By: Mr D Member since: Feb 12, 2017
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  6. Newchodge

    Newchodge UKBF Big Shot Free Member

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    If the director is an employee and paid through PAYE I see no reason why they should not be furloughed, but we don't know yet.

    Banks should lend/overdraft to cover 80% for employees until recovery is possible. We also don't know what 80% covers. Wages (based on what?) employer's NI? employer's pension? Payroll provider bill? (Perhaps I should increase my rates, just in case :cool:)
     
    Posted: Mar 24, 2020 By: Newchodge Member since: Nov 8, 2012
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  7. Andy Harris

    Andy Harris UKBF Regular Full Member

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    It's not yet clear what the position is on whether a director can be furloughed (especially if a sole director). What is clear is that HMRC are backdating it to 1st March purely because that gives them a view of the payroll at that time (to avoid people suddenly putting people on the payroll and claiming 80% for them). For the many directors who pay themselves the minimum each month, making it up with dividends, it's going to be tough.
     
    Posted: Mar 25, 2020 at 9:22 AM By: Andy Harris Member since: Oct 3, 2009
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  8. Dean Sayer

    Dean Sayer UKBF Newcomer Free Member

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    I am very keen to know this too, I furloughed 3 office staff last week and 2 manual workers yesterday, I myself am mothballing works for the next few days so hope after that I can furlough myself... though I will have to be the weekly and monthly payrolls still and keeping the bills paid etc.... Does that mean I am still working so can not use the scheme ??
     
    Posted: Mar 27, 2020 at 8:39 AM By: Dean Sayer Member since: Mar 27, 2020
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  9. Bluejen84

    Bluejen84 UKBF Contributor Free Member

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    My accountant also says as director you can't be furloughed.
     
    Posted: Mar 27, 2020 at 8:47 AM By: Bluejen84 Member since: Feb 25, 2020
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  10. Newchodge

    Newchodge UKBF Big Shot Free Member

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    How long has your accountant been an HR expert? The guidance does not exclude directors. The issue may be that the director will have to provide some service for the company (like running payroll and claiming the grant), but if they are only doing that they may be able to claim. Or if they outsource payroll and claiming to an external provider, set it all up with standing orders to make the payments, then furlough themselves.
     
    Posted: Mar 27, 2020 at 8:53 AM By: Newchodge Member since: Nov 8, 2012
    #10
  11. Dean Sayer

    Dean Sayer UKBF Newcomer Free Member

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    Thank you both for the quick replies, I sure hope so there is something as if no income for myself why on earth would I keep the company afloat !!

    Well to be honest I would keep it going but that is not the point, clients will still likely have questions that need answering etc. so I will be checking emails etc daily too... or would I have to stop that too, lots of questions that HMRC obviously still have to work out.
     
    Posted: Mar 27, 2020 at 9:01 AM By: Dean Sayer Member since: Mar 27, 2020
    #11
  12. ecommerce84

    ecommerce84 UKBF Regular Free Member

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    On the page for the self employed here: https://www.gov.uk/government/news/chancellor-gives-support-to-millions-of-self-employed-individuals it says:

    “Those who pay themselves a salary and dividends through their own company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.”

    I read that as directors are covered for their PAYE income if the business is unable to trade due to CV-19.

    For furloughed employees they shouldn’t be doing any work for their employer whilst they are furloughed.

    Other than essential admin such as payroll, I don’t think furloughed directors should be doing any other work, including emails and phone calls, so you’ll have to change your voicemail, stick on an auto reply and redecorate the house instead!
     
    Posted: Mar 27, 2020 at 9:16 AM By: ecommerce84 Member since: Feb 24, 2007
    #12
  13. Dean Sayer

    Dean Sayer UKBF Newcomer Free Member

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    Thank you for the link and quote !!

    That is all fine by me for sure, I have a LOT more than just decorating to do on my home :D
     
    Posted: Mar 27, 2020 at 9:22 AM By: Dean Sayer Member since: Mar 27, 2020
    #13
  14. Newchodge

    Newchodge UKBF Big Shot Free Member

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    Thanks, I hadn't read the self employed stuff as, for some reason, my workload has not (yet) diminished!
     
    Posted: Mar 27, 2020 at 9:37 AM By: Newchodge Member since: Nov 8, 2012
    #14
  15. Dean Sayer

    Dean Sayer UKBF Newcomer Free Member

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    Same here, I hope to get more time for research soon as currently mothballing jobs, getting invoices out, Payrol, Subby & Supplier payments, bank reconciling etc ready for VAT qtr... Gawd.

    So I really appreciate the info gained so quickly so far, I feel this forum will be a godsend going forward especially when work picks back up again.
     
    Posted: Mar 27, 2020 at 9:41 AM By: Dean Sayer Member since: Mar 27, 2020
    #15
  16. philipthechilip

    philipthechilip UKBF Newcomer Free Member

    19 1
    I'm the sole Director and only Paye Employee for my Ltd company too.

    Unfortunately I pay myself with dividends and Paye, so it won't be much I get from this, but it will be better than nothing.

    Is there anything we need to do at this stage to ensure we are eligible for the 80% grant of our Paye? Or is it a case of waiting for more instructions?

    Many thanks
     
    Posted: Mar 27, 2020 at 10:21 AM By: philipthechilip Member since: Aug 13, 2011
    #16
  17. UK Contractor Accountant

    UK Contractor Accountant UKBF Big Shot Full Member - Verified Business

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    As Martin Lewis said on This Morning - you are not supposed to be working for the business your are furloughed by but you can still (I think) take a temporary position elsewhere and earn some extra money.

    That's if you can find extra work - Supermarkets etc
     
    Posted: Mar 27, 2020 at 10:44 AM By: UK Contractor Accountant Member since: Sep 18, 2013
    #17
  18. Newchodge

    Newchodge UKBF Big Shot Free Member

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    Please keep an eye on this thread https://www.ukbusinessforums.co.uk/threads/furlough-latest-guidance.404842/#post-2997317
     
    Posted: Mar 27, 2020 at 11:00 AM By: Newchodge Member since: Nov 8, 2012
    #18
  19. UKSBD

    UKSBD Not a real duck Staff Member

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    Posted: Mar 27, 2020 at 11:18 AM By: UKSBD Member since: Dec 30, 2005
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