Up to £3.5 billion in furlough payments fraudulent, HMRC finds

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09 Sep 2020

HMRC has revealed that almost £3.5 billion in Coronavirus Job Retention Scheme (CJRS) payments have been claimed fraudulently or paid out in error.

HMRC told the Public Accounts Committee (PAC) that it estimates that between 5% and 10% of CJRS funds have been provided in error. According to the PAC, in 2019 £30 billion in tax was lost as a result of taxpayer error and fraud.

HMRC said it intends to target individuals who made fraudulent CJRS claims, rather than penalise employers who made legitimate mistakes in compiling their claims.

Commenting on the issue, Jim Harra, Chief Executive of HMRC, said: 'We have made an assumption for the purposes of our planning that the error and fraud rate in this scheme could be between 5% and 10%. That will range from deliberate fraud through to error.

'Although we will expect employers to check their claims and repay any excess amount, what we will be focusing on is tackling abuse and fraud.'