Anna’s Accountancy Alerts – Week 30 (26th October – 1st November 2020)

Small business owner decides to financial problems

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Deferral Opportunity For Self-Assessment Taxpayers

This relates to self-assessment tax payments due 31 January 2021.

Those with liabilities of up to £30,000 can apply online to spread their liability into monthly payments

Subject to interest at HMRCs published rates, currently 2.6% per annum, without penalty.

The taxpayer has no obligation to declare that they have been adversely impacted by Covid-19. The requirements are that:

  • there are no outstanding tax returns;
  • there are no other tax debts;
  • there are no other HMRC time to pay arrangements;
  • the self-assessment tax bill is between £32 and £30,000, and;
  • it is no more than 60 days since the tax was due for payment.

The application must be made by the taxpayer (not an agent) through the government gateway. More detail is available here.

It is a good idea to finalise and submit your 2019/20 tax return, and apply for the Time to Pay Service well in advance of 31 January 2021.

If the conditions above are not met, for example because the taxpayer has other deferred taxes as a result of COVID-19, it is still possible to set up a Time to Pay arrangement, but this would need to be done over the telephone.

Do You Have Employees Working From Home Because Of COVID-19?

If you have asked your employees to work at home because of COVID-19 then they may have additional expenses.

If you’ve not reimbursed your employees, they can claim tax relief on £6 per week or £26 per month for these extra costs. If your employee wants to claim more, they must provide HMRC with evidence to support their claim.

You can only claim if your employer has asked you to work from home for all or part of the week. For example, because you have a rota system in place to allow for social distancing.

How To Claim

The quickest and easiest way to claim is to apply online at GOV.UK. It’s secure and ensures you’ll receive your full entitlement. Your tax code will be adjusted, reducing the tax you pay.

Go to GOV.UK and search ‘Claim tax relief for your job expenses’.

New “Kickstart Scheme” For Employers

The government has launched a fund to subsidise employers who take on new young employees.

Under the new Kickstart Scheme, which is scheduled to start in November 2020, the government will pay employers across England, Scotland and Wales 100% of the national minimum wage, the associated NI and workplace pension contributions for qualifying new employees they take on where conditions are met. The government will also pay employers £1,500 per job placement towards the cost of support and training of the employee and to help pay for uniforms and other job set-up costs.

The scheme will apply where employers offer youngsters aged 16 to 24 a six-month work placement if at the time of the job offer they are claiming Universal Credit

From November 2020 the government will meet the minimum wage and other employment costs if you take on 30 or more new employees who were claiming Universal Credit. Employers can group together to meet the target.

Stay Up-To-Date With Coronavirus & Brexit News

Coronavirus has affected us all. Whether you’re a sole trader, employer or employee. Stay up to date with the latest news – including government support, tax implications, and more.