Question: What would be the case for a director who is furloughed who is applying for new Coronavirus business intervention loans or government grants?
Strictly speaking this work would fall outside of the performance of statutory duties and this would therefore not fall into the category of furlough. (This seems a little crazy so we could see this change in future)
Question: Directors doing the books and records is OK as it is not generating commercial revenue or new business is that correct?
Please see below FAQ based on HMRC guidance:
What about Company Directors?
As office holders, salaried company directors are eligible to be furloughed and receive support through this scheme. Company directors owe duties to their company which are set out in the Companies Act 2006. Where a company (acting through its board of directors) considers that it is in compliance with the statutory duties of one or more of its individual salaried directors, the board can decide that such directors should be furloughed. Where one or more individual directors’ furlough is so decided by the board, this should be formally adopted as a decision of the company, noted in the company records and communicated in writing to the director(s) concerned.
Where furloughed directors need to carry out particular duties to fulfil the statutory obligations they owe to their company, they may do so provided they do no more than would reasonably be judged necessary for that purpose, for instance, they should not do work of a kind they would carry out in normal circumstances to generate commercial revenue or provides services to or on behalf of their company.
This also applies to salaried individuals who are directors of their own personal service company (PSC).
Question: In terms of directors, can they be furloughed and still do the admin work of the company, given that they need to keep the business going. E.g. pay bills, answer phone, communicate with accountant to provide required documents for vat return submission etc. Will these activities disqualify the director from furlough pay?
Please see the FAQ based HMRC guidance above.
Question: Can you furlough more than 1 director?
Yes, a company only needs one director to carry out statutory duties.
Question: We process director’s salaries annually. Does this now need to be done monthly to allow the RTI to co-inside with the claim we will be making?
As they are salaried the normal rules should apply.
If you are a furloughed director and have questions concerning your business and how you continue to run it whilst furloughed our team will be able to help you. Our team can be contacted on firstname.lastname@example.org