January 2021

Two children in coronavirus lockdown playing breath on the glass
The deadline for claiming the third SEISS is on or before 29‌‌‌ ‌January 2021. As with the first and second SEISS grants, the third grant will be subject to Income Tax and self-employed National Insurance and must also be reported on your 2020-21 Self Assessment tax returns (to be submitted by 31‌‌‌ ‌January 2022). Confirming A Significant Reduction In Trading Profits Before you make a claim for the third grant, you must decide if the impact on your business will cause a significant reduction in your trading profits for the tax year you report them in. You do not have to consider any other coronavirus scheme support payments you have already received when deciding whether you reasonably believe that you will suffer a significant reduction in trading profits due to reduced activity, capacity, demand or inability to trade due to coronavirus during 1‌‌‌ ‌November 2020 to 29‌‌‌ ‌January 2021 (period covered by the third grant). Details of the extra support HMRC can provide for you can be found on GOV.UK. The Third SEISS Grant And Working Parents If you are unable to work because you have additional caring responsibilities due to school closures, and you meet all other conditions, you are eligible to claim, provided you reasonably believe that the impact of taking this time off will significantly reduce your trading profits for the year that you report them in. Details of the eligibility criteria can be found on GOV.UK. Other Types Of Work And The Third SEISS Grant Due to the impacts of coronavirus, HMRC know that some customers who are usually self-employed are also seeking other forms of work. If you receive the grant you can: Continue to work. Start a new trade or take on other work including voluntary work and duties as a military reservist. You must also declare that you intend to continue to trade.

Employees have no general legal right to take time off work to attend medical appointments, nor to be paid for any time off that may be granted, and this includes vaccination appointments.

In the absence of a statutory right, employees may nevertheless have a contractual right to paid or unpaid time off for medical appointments, so its best to check your employment contracts and policies.

Even if you have no contractual provision for time off, it’s likely that you’ll want to be seen to support the national coronavirus vaccination programme.

So, it’s a good idea to consider granting time off, preferably with pay if you want to incentivise your staff to get the vaccine.

The all-party parliamentary group (APPG) is pushing the Treasury to offer financial support packages for an estimated three million people who have not be able to access other Covid-19 schemes since the beginning of the pandemic.

Groups who have been left out include:

  • the newly self-employed, who have not filed a 2018/19 tax return by the date required for application to the self-employed income support scheme (SEISS), or earned more than £50,000 or under half their income from self-employment.
  • seasonal workers who have been refused furlough despite being eligible;
  • limited company directors;
  • and new mothers and fathers who made use of parental leave over the past three years.

Earlier this month, the group’s co-chair Tracy Brabin presented a 10-Minute Rule Bill on plans to help those who have been left out of financial support schemes since the beginning of the pandemic.

The Bill, which passed first reading and will go to second reading on 29 January, would require the government to ‘undertake an assessment of any gaps in financial support provided to individuals, businesses and industries over the course of the Covid-19 pandemic; to require the government to report to Parliament on steps it intends to take in connection with any such gaps’.

The APPG, which has around 260 MPs as members, has outlined its own proposals for addressing the shortfalls in support it has identified. 

These include making previously excluded self-employed groups eligible for the next round of SEISS or a one-off grant of either £7,500 for the long-term self-employed or £3,500 for newer entrants.

Company directors would receive either a one-off grant of £7,500 or be able to claim under a new system similar to SEISS and dubbed the ‘directors income support scheme’.

Today (25/01/21) HMRC has announced that Self-Assessment customers will not receive a penalty for filing their 2019-20 Tax Return late, as long as they file online by 28‌‌ ‌February. 

HMRC are still encouraging customers who have not yet filed to do so by 31‌‌ ‌January, if possible.

You still need to pay your Self-Assessment tax bill by 31‌‌ ‌January.

Interest will be charged from 1‌‌ ‌February on any outstanding liabilities.

If you cannot afford to pay by 31‌‌ ‌January, you may be able to set up an affordable plan and pay in monthly instalments. But you will need to file your 2019-20 Tax Return before setting up a time to pay arrangement.

If you notice an error on a VAT return which relates to a period covered by the VAT Payments Deferral Scheme, you should send a VAT652 form to HMRC as soon as possible.

Go to GOV‌‌‌.UK and search ‘Correct errors on your VAT Returns’ for more information.

You will then receive a Statement of Account confirming the balance, and if any extra payments are needed as a result, you can contact HMRC to defer these too, before the end of January.

You can:

  • pay the deferred VAT in full on or before 31‌‌ ‌March 2021;
  • opt in to the VAT Deferral New Payment Scheme when it launches in early 2021 (more information to follow shortly);
  • contact HMRC if your clients need more help to pay.

The third grant covers the period from November to January and requires a business to meet more stringent conditions rather than just be “adversely affected”, as was the case for the first and second grants. Full details can be found here.

Similar to the first and second SEISS grants, the third SEISS grant will also be subject to Income Tax and self-employed National Insurance. Alongside the first and second grants, the third SEISS grant should be reported on your’ 2020/21 Self-Assessment tax return (filing deadline 31‌‌‌ January‌‌ ‌2022).

Where you also claim Universal Credit (UC), the Self-Employed Income Support Scheme grant should be reported to DWP in the month the grant is paid and may affect the amount of UC received.

On 26‌‌ ‌January, HMRC will be publishing a list of employer names who have claimed CJRS for periods starting on or after December onwards on GOV‌‌‌.UK.

From February, HMRC will publish the names, an indication of the value of claims and Company Registration Numbers (for those who have one) of employers who make CJRS claims for periods starting on or after 1 December. The published value of claims will be shown within a banded range – to find a list of these, search ‘Check if you can claim for your employees’ wages’ on GOV‌‌‌‌‌‌.UK.

HMRC will not publish details of employers claiming through the scheme if you can show that publicising these would result in a serious risk of violence or intimidation to individuals, or those living with them. You can request for their details not to be published by completing the online application form – you can go to GOV‌‌‌.UK and search ‘Check if you can claim for your employees’ wages’.

If employers need to do this, HMRC will not publish their details until a decision has been made and they have been informed. Employers only need to apply once, as the decision will cover all CJRS claim periods starting from 1 December 2020.

Applications must be made by an employer and it can’t be made by an agent on their behalf.

Employees will also be able to check if a CJRS claim has been made on their behalf through their online Personal Tax Account from February. They can set up a Personal Tax Account by going to GOV‌‌‌‌‌‌.UK and searching ‘Personal Tax Account: sign in or set up’.

Details of CJRS claims will now be published monthly as part of HMRC’s commitment to transparency and to deter fraudulent claims.

Employees can ask to be furloughed because they have caring responsibilities resulting from Coronavirus, such as caring for children who are at home as a result of school or childcare closing. You can place them on furlough and claim for them under the CJRS. 

Thank you if you submitted your clients’ December furlough claims by the deadline of 14 January.

If you didn’t submit your December claim on time, HMRC may still accept it if there is a reasonable excuse for not claiming by the deadline, such as self-isolating, or an unexpected stay in hospital that prevented completing a claim.

If the reason means you can claim late, please do so as soon as you’re able to, and note that reasonable excuses only apply to late claims for periods from November onwards.

For more information on reasonable excuses, go to GOV‌‌‌.UK and search ‘claim for wages’.

If you have already submitted claims for December but need to make a change because you didn’t claim enough, you can do this until Thursday‌‌ ‌28‌‌ ‌January.

To find out how to amend a claim, search ‘Get help with the Coronavirus Job Retention Scheme’ on GOV‌‌‌‌‌.UK.

What You Need To Do Now

  1. If you haven’t submitted a claim for December but believe that you or your clients have a reasonable excuse, check if you can apply to make a late claim by searching ‘claim for wages’ on GOV‌‌‌.UK.
  2. Check they claimed the right amount in December by looking at the eligibility criteria and calculating how much they can claim – search ‘Job Retention Scheme’ on GOV‌‌‌.UK.
  3. Submit any claims for January no later than Monday‌‌ ‌15‌‌ ‌February.
  4. Keep records that support the amount of CJRS grant claimed, in case HMRC needs to check them. ‌

Making A Claim Online

To make a CJRS claim, you will need to be registered and have the required access, password or activation code for HMRC online services. For more information search ‘HMRC services’ on GOV‌‌‌.UK.  

You can now submit your CJRS furlough claims for periods in January. These must be made by 15‌‌ ‌February.

Claims can be made before, during or after your payroll is processed. If you can, it’s best to make a claim once you’re sure of the exact number of hours employees will work so you don’t have to amend the claim at a later date.

The government has decided to exempt employees from being taxed on a benefit in kind where their employers pay for them to be tested for coronavirus.

There are two types of test; one to check if someone currently has coronavirus, the antigen test, and the other to check whether someone carries the antibodies showing that they have already had the virus. The exemption only applies to coronavirus antigen tests.

Tests to check if you’ve previously been infected aren’t covered. The exemption applies from 8 December 2020 until 5 April 2021 but HMRC will in effect apply it from 6 April 2020.

Businesses will be given until the end of March to access the:

Bounce Back Loan Scheme (BBLS),

Coronavirus Business Interruption Loan Scheme (CBILS)

Coronavirus Large Business Interruption Loan Scheme (CLBILS).

Chancellor Rishi Sunak has extended the Coronavirus Job Retention Scheme (CJRS) until the end of April 2021.

The government will continue to pay 80% of employees’ salaries for hours not worked.

Employers will only be required to pay wages, national insurance contributions (NICs) and pensions for hours worked, and NICs and pensions for hours not worked.

CJRS

You can find everything you need to know about CJRS on GOV‌‌‌‌‌‌.UK by searching ‘Job Retention Scheme’, but here are some answers to the most frequently asked questions.

Can I Furlough An Employee If They Are Unable To Work Due To Caring Responsibilities?

If an employee asks to be furloughed because they have caring responsibilities resulting from coronavirus, such as caring for children who are at home as a result of school or childcare facilities closing, you can place them on furlough and claim for them under the CJRS.

Can A CJRS Grant Be Used To Pay For Holiday Leave?

If employers have furloughed employees because of the effect of coronavirus on their business, they can claim under the CJRS for periods of paid leave their employees take while on furlough, including for bank holidays such as Christmas Day or Boxing Day. Employers should not place employees on furlough just because they are going to be on leave.

If an employee is flexibly furloughed, you can count any time taken as holiday as furloughed hours rather than working hours. This means you can claim 80% of employees’ usual wages for these hours.

If a furloughed employee takes holiday, their employer should top up their pay to their normal rate in line with the Working Time Regulations. For more information search ‘check if you can claim for your employees’ wages’ on GOV‌‌‌‌‌‌‌‌.UK.

Can I Include A Christmas Bonus In My Calculation For The Grant?

You can claim for regular payments that you are contractually obliged to pay employees, including compulsory commission, fees and overtime.

However, you cannot claim for discretionary commission, non-contractual bonuses (including tips) and non-cash payments.

 For more information search ‘steps to take before calculating your claim’ on GO‌‌‌V‌‌‌‌‌‌‌.UK.

SEISS

You can find everything you need to know about the third SEISS grant on GOV‌‌‌.UK by searching ‘Self-Employment Income Support’, but here are some answers to the most frequently asked questions, to help support you.

AM I Eligible For The Third SEISS Grant?

You can find all you need to know about SEISS, including the eligibility criteria for the third grant, on GOV‌‌.UK by searching ‘Self-Employment Income Support Scheme’.

I Have Lost My Unique Taxpayer Reference (UTR)/National Insurance Number (NINO)/Government Gateway User ID And/Or Password, What Should I Do?

During the SEISS online claim process, there are prompts for recovering lost UTR, NINO and Government Gateway credentials. You should be able to get these details online without having to call HMRC.

What If My Business Recovers After I’ve Claimed The Third Grant?

If your business recovers after you’ve claimed, your eligibility will not be affected as this is based on your reasonable belief that your trading profits would have been significantly impacted when you made your claim. Anyone who receives a grant must keep evidence in support of their claim.

Should I Take Into Account The Value Of Previous SEISS Grants When Deciding Whether I Can Claim The Third SEISS Grant?

You do not have to consider any other coronavirus scheme support payments you have already received when deciding whether you reasonably believe that you will suffer a significant reduction in trading profits.

This reduction needs to be due to reduced activity, capacity, demand or inability to trade due to coronavirus during 1 November 2020 to 29‌‌ ‌January‌‌ ‌2021.   

How Can I Find Out More About The Fourth SEISS Grant?

HMRC will contact you when details of the fourth SEISS grant are confirmed.

The third grant of the (SEISS) closes for claims on Friday‌‌ ‌29‌‌ ‌January.

Eligible customers must claim on or before this date.

You Must Submit Any December Claims No Later Than‌‌ ‌Thursday‌‌ ‌14‌‌ ‌January.

You can claim before, during or after processing payroll.

If you can, it’s best to make a claim once you’re sure of the exact number of hours employees worked so you don’t have to amend the claim at a later date.

As a reminder, the UK Government will pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month, until the end of April 2021.

What You Need To Do Now

  1. Check if you’re eligible and work out how much you can claim using HMRC CJRS calculator and examples, by searching ‘Job Retention Scheme’ on GOV‌‌‌.UK.
  2. Submit any claims for December no later than‌‌ ‌Thursday‌‌ ‌14‌‌‌‌‌ ‌January.
  3. Keep records that support the amount of CJRS grant claimed, in case HMRC needs to check them. ‌

If you have already submitted claims for December but find you need to make a change because you didn’t claim enough, you can do this until ‌‌Thursday‌‌ ‌28‌‌ ‌January.

To find out how to amend a claim, search ‘Get help with the Coronavirus Job Retention Scheme’ on GOV‌‌‌‌‌.UK.

HMRC was asked by professional accountancy bodies to move the self-assessment deadline from 31/01/21 for 19/20 self-assessment returns but this is not going to happen.

However, no one will have to pay a penalty if they cannot file on time because of the impact of coronavirus.

HMRC will accept personal or business disruption as a “reasonable excuse”, though it will be down to the individual to explain exactly how they have been affected.

The deadline for appealing against late filing or payment penalties has also been extended from the usual 30 days to three months.

It is best to file on time unless it’s genuinely not possible to do so.  

Even if you don’t have all the figures you need, use provisional ones then submit an amendment later on.  

It will save you needing to argue any case for a reasonable excuse at all.

Businesses in the retail, hospitality and leisure sectors are to receive a one-off grant worth up to £9,000. The cash is provided on a per-property basis to support businesses through the latest restrictions

Alongside this grant, the chancellor also announced a new £594m discretionary fund made available to support other impacted businesses.

Chancellor Rishi Sunak said: “The new strain of the virus presents us all with a huge challenge – and whilst the vaccine is being rolled out, we have needed to tighten restrictions further. Throughout the pandemic, we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the Spring. This will help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”