BUSINESSES should be prepared for changes to the furlough scheme in the coming weeks, according to Ludlow based accountancy firm Thorne Widgery.

HM Revenue & Customs has recently published a series of updates to its guidance on the Coronavirus Job Retention Scheme.

The updates cover the changes to the scheme, as it has been extended from May to September 30.

The guidance confirms that new employees who have not previously been eligible for furlough can be furloughed for the first time from May 1, 2021 onwards, if they were included in a Full Payment Submission to HMRC by March 2.

“The furlough scheme has provided a lifeline to many employers during the pandemic, but in the months ahead a number of changes will mean that the cost of employment rises once again,” said Daniel Crowther, chief executive officer of Thorne Widgery.

“Although many sectors are now re-opening, many companies face a challenging time ahead, especially as cash flow remains constrained.

“The withdrawal of vital Government support could put the success of some businesses at risk, unless they take action now.”

Furloughed employees will receive 80 per cent of their usual wages capped at £2,500 a month, or equivalent for usual hours not worked under the extended scheme.

The grants will continue to cover the full 80 per cent paid to employees in May and June, while employers must cover National Insurance and workplace pension contributions. However, employers will make a 10 per cent contribution in July and a 20 per cent in August and September, as the Government reduces the amount of support.