Employees were on variable rates rather than fixed rates

The taxpayer managed commercial and industrial property. It claimed coronavirus job retention scheme (CJRS) payments for its two employees RB and KB who are also husband and wife. Up to 27 February 2020 there were no employment contracts in place and the two employees who were on HMRC’s real-time information system received ad hoc payments. On 27 February they signed formal employment contracts whereby each was paid £3 200 a month for a fixed four-month term although the taxpayer’s RTI submissions did not reflect these payments until 25 May.

In letters dated 17 April the taxpayer informed the employees that they were on furlough and this began on 1 March. It claimed payments under the CJRS.

HMRC said the employees were variable rate employees and were not paid an annual salary. They therefore did not qualify for the sums of furlough payments claimed...