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Recording furlough leave and statutory sick leave in Xero Payroll

Posted 6 months ago in Product by Shay McCusker
Posted by Shay McCusker

In response to the UK government’s Coronavirus Job Retention Scheme, we’ve been working hard to respond to a rapid pace of change. With new and frequent updates from government, our focus has been on working quickly to find the best solutions to help you and your business navigate through this challenging time.  

We were pleased last week to be able to launch new functionality enabling businesses to record furlough leave for eligible employees in Xero Payroll. We’ve also added COVID-19 self isolation as a sick leave option for employees who are required to self-isolate, so they can earn sick pay from day one instead of the usual four consecutive days.

Furlough leave in Xero

Furlough leave is now available through Time Off, giving businesses a simple and accurate way to comply with the Job Retention Scheme. HMRC will provide a grant to cover 80% of furlough employee pay, up to £2,500 per month.

The scheme also covers associated furlough costs for the employer’s national insurance and minimum pension contributions. Furlough employees won’t be able to work, but they’re free to do training, volunteer for frontline services or support those in need during COVID-19.

To manage furlough leave in Xero Payroll, we’ve added the following features: 

  • the ability to support 80% of an employees’ regular earnings, further calculating and storing the employer claim values for national insurance and minimum pension contributions
  • flexibility to record furlough periods as and when they occur
  • the opportunity for payroll managers to top up an employee’s wage without including it in the claim value.

See our FAQs on processing furlough leave in Xero Payroll

Updates for furlough leave coming soon

The information prepared within the pay run to determine the scheme claim value will be stored in readiness for the scheme claim report.

While this feature is not yet available, Xero’s product team is working hard to have this live by the end of April.

Update: this feature is now available. See our updated FAQs on processing furlough leave in Xero Payroll

See how to record furlough leave in Xero Payroll

To learn more about how to record furlough leave in Xero Payroll, see below to catch up on the recording of our demo last week with Xero Payroll specialist Jane Mitchell.

Or check in on our Xero Central guidance on how to record furlough leave step by step. 

Statutory sick leave now available

We’ve also added COVID-19 self isolation as a sick leave option for employees who are required to self-isolate, so they can earn sick pay from day one instead of the usual four consecutive days.

HMRC is currently working on a process to help small and medium-sized businesses reclaim two weeks of self-isolation sick pay – once this is ready, we’ll help you capture these records and support the reclaim process.

See our guidance in Xero Central to learn more about setting up statutory sick leave.

Learn more about Xero Payroll

If you don’t yet use Xero Payroll, you can learn more about it on our website and get three months free for up to five employees as part of your Xero Business Edition subscription. 

Or join our webinar to learn about the key features of Xero Payroll and answer any questions you might have. 

14 comments

Neil
April 23, 2020 at 8.42 pm

how and when can we print the scheme claim report

Ashleigh Gibson in reply to Neil
April 23, 2020 at 8.56 pm

Hi Neil, we are aiming to have the scheme claim report live by the end of April. We’ll update as soon as we can when that’s available.

Charlie Buchan in reply to Ashleigh Gibson
May 6, 2020 at 3.59 am

Hi there is there any update on when this will be live?

Beeny Atherton in reply to Charlie Buchan Xero
May 6, 2020 at 11.30 am

Hi Charlie, sorry – there’s been a slight delay with claim report – it will be available very soon (early May).

Tom Brown in reply to Beeny Atherton
May 12, 2020 at 4.14 am

Hi Beeny,
Any update regarding the claim report being available?
Will all payroll users be notified when it is available?

Thanks
Tom

Beeny Atherton in reply to Tom Brown Xero
May 13, 2020 at 8.57 am

Hi Tom, thanks for getting in touch. The claim report is still being worked on so it’s not available yet but we will let you know as soon as it is.

Sylvester Augustin in reply to Beeny Atherton
May 12, 2020 at 9.41 pm

Hi,

Is the report option ready now?

Thanks,
Sylvester

Beeny Atherton in reply to Sylvester Augustin Xero
May 13, 2020 at 8.56 am

Hi Sylvester, the team is still working on the claim report and it’s not quite ready yet. We will let you know as soon as it’s available. I’m sorry for the delay.

Charlie Buchan in reply to Beeny Atherton
May 18, 2020 at 8.14 pm

Any update?

Xero in reply to Charlie Buchan
May 18, 2020 at 9.05 pm

Hi Charlie, we hope to have an update from the team working on it very soon. We’re so sorry for the delay.

Nicola
April 23, 2020 at 11.28 pm

Hi, I’ve just read that HMRC are advising that we use calendar days to calculate furlough periods but I’ve noticed that Xero works them out based on working days. Is this going to cause an issue with claims? Thanks

Laura Barrett
April 29, 2020 at 5.50 am

The NIC and Pension XERO is calculating is completely different to the one that the govenments calculator is working out. Is anyone else having this issue? The Gov calculator is saying the NIC and Pension is much higher.

Charlie Buchan
May 18, 2020 at 8.13 pm

Still any news on the report? We have been told end of April, early May and very soon. I need to get my claim in to HMRC now. If I don’t I will not have enough cash to pay my staff another month of furlough.

Xero in reply to Charlie Buchan
May 18, 2020 at 9.02 pm

Hi Charlie, we’re so sorry for the delay. Our team are doing everything they can to have the report available as soon as possible. If you need any help inputting the figures from HMRC’s calculator into Xero, please reach out to our support team directly > https://central.xero.com/s/contact-support.

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