HMRC taskforce created to investigate furlough fraud among employers

Budget 2021: Chancellor of the Exchequer Rishi Sunak has announced the creation of a ‘taskforce’ to tackle fraud within the furlough scheme.

Sunak revealed a £100 million investment in the HM Revenues and Customs’ (HMRC) Taxpayer Protection Taskforce to crack down on those who defraud Covid-19 (Coronavirus) government support initiatives, including the Coronavirus Job Retention Scheme (CJRS).

Stephen Ratcliffe, partner in the employment practice at Baker McKenzie, said: “The rules of the scheme, particularly around calculating pay entitlement, are complex, and the government has made clear over the last year that misuse will be investigated and penalties issued.

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“The news that HMRC will gain a well-funded enforcement unit consisting of 1,000 inspectors to investigate furlough fraud claims means that all employers that have used the scheme should make sure that they have kept proper records throughout the scheme and are ready to answer the inspectors’ questions if needed.

“Experience of minimum wage enforcement by HMRC tells us that it is unlikely to hesitate to issue penalties where infractions have occurred.”