May 2020

Working from home

This scheme is now live on GOV‌.UK.

Employers with fewer than 250 employees can now claim for coronavirus-related Statutory Sick Pay (SSP).

A tax agent can also make claims on behalf of employers.

To make a claim now, please visit GOV‌.UK and search ‘Check if you can claim back Statutory Sick Pay paid to employees due to coronavirus (COVID-19)‘.

Which Employers Can Use The Scheme?

Employers are eligible to use the scheme if they meet all of the following criteria:

  • they’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • they had a PAYE payroll scheme in operation before 28 February 2020
  • they had fewer than 250 employees across all PAYE schemes on 28 February 2020
  • they’re eligible to receive state aid under the EU Commission Temporary Framework – more information about this can be found on GOV‌.UK (please use the search term above).

Which Employees Are Entitled To SSP?

The repayment will cover up to two weeks of the applicable rate of SSP, and is payable if a current or former employee was unable to work on or after 13 March 2020 and entitled to SSP, because they either:

  • had or have coronavirus
  • could not or cannot work because they were/are self-isolating at home
  • were/are shielding in line with public health guidance.

Which Records Should Employers Keep?

Employers must keep records of SSP that they have paid and want to claim back from HMRC.

They must keep the following records for 3 years after the date they receive the payment for their claim:

  • the dates the employee was off sick
  • which of those dates were qualifying days
  • the reason they said they were off work – if they had symptoms, someone they lived with had symptoms or they were shielding
  • the employee’s National Insurance number.

Employers can choose how they keep records of their employees’ sickness absence. HMRC may need to see these records if there’s a dispute over payment of SSP.

It will launch online on 26 May.

The scheme will enable employers with fewer than 250 employees to claim coronavirus-related Statutory Sick Pay (SSP).

Tax agents will be able to make claims on behalf of employers.

Employers Are Eligible To Use The Scheme If:

  • they’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • they had a PAYE payroll scheme in operation before 28 February 2020
  • they had fewer than 250 employees across all PAYE schemes on 28 February 2020
  • they’re eligible to receive State Aid under the EU Commission Temporary Framework.

The repayment will cover up to two weeks of the applicable rate of SSP, and is payable if a current or former employee was unable to work on or after 13 March 2020 and entitled to SSP, because they either:

  • have coronavirus
  • are self-isolating and unable to work from home
  • are shielding because they’ve been advised that they’re at high risk of severe illness from coronavirus.

To prepare to make a claim, employers should keep records of all the SSP payments they wish to claim for.

For more information about eligibility and how employers (or you on their behalf) can prepare to use the scheme, please visit GOV.UK and search ‘Check if you can claim back Statutory Sick Pay paid to employees due to coronavirus (COVID-19)‘.

It will launch online on 26 May.

The scheme will enable employers with fewer than 250 employees to claim coronavirus-related Statutory Sick Pay (SSP).

Tax agents will be able to make claims on behalf of employers.

Employers Are Eligible To Use The Scheme If:

  • they’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • they had a PAYE payroll scheme in operation before 28 February 2020
  • they had fewer than 250 employees across all PAYE schemes on 28 February 2020
  • they’re eligible to receive State Aid under the EU Commission Temporary Framework.

The repayment will cover up to two weeks of the applicable rate of SSP, and is payable if a current or former employee was unable to work on or after 13 March 2020 and entitled to SSP, because they either:

  • have coronavirus
  • are self-isolating and unable to work from home
  • are shielding because they’ve been advised that they’re at high risk of severe illness from coronavirus.

To prepare to make a claim, employers should keep records of all the SSP payments they wish to claim for.

For more information about eligibility and how employers (or you on their behalf) can prepare to use the scheme, please visit GOV.UK and search ‘Check if you can claim back Statutory Sick Pay paid to employees due to coronavirus (COVID-19)‘.

https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan

The loan available earlier on in this period was the Coronavirus Business Interruption Loan Scheme (CBILS) The trouble with CBILS loans, which are made by banks, are only guaranteed up to 80% by the government. This means banks have been cautious and slow in granting loans, especially to small businesses, as they risk losing 20% of the debt if a borrower goes under.

Bounce Back Loans. 

To help smaller businesses get funding outside of the CBILS, the government launched “bounce back” loans on 4 May.

These offer lenders a 100% government guarantee if a business can’t repay the loan.

Government pays for the interest and fees for the first year.

The cash could be available within as little as 24 hours.

No repayments will be required during the first year.

After the first year you will have to make repayments including interest but the government has promised that this will be at a low and standardised rate.

The loans can be up to £50,000 (but not less than £2,000) and must be repaid within six years.

Small businesses which have received a CBILS loan can switch to a bounce back loan if they are eligible.

There are no financial viability tests except that the business must not have been an “undertaking in difficulty” on 31 December 2019.

The Chancellor has extended the Government’s furlough scheme until the end of October.

There will be no changes to the current scheme until the end of July.

From August to October the scheme will continue, but with greater flexibility to support the transition back to work.

Employers currently using the scheme will be able to bring furloughed employees back part-time.

He will ask employers to begin sharing the cost of paying people’s salaries with the government.

Further information on the changes will come at the end of the month.

Save And Return Option Now Added

This means that you can now return to a partially completed claim, rather than having to do it all in one go.

Avoiding Common Mistakes

When you make a claim through the Coronavirus Job Retention Scheme, you will receive the funds within six working days after you apply, provided your claim matches records that HMRC hold for your PAYE scheme. Making sure that you submit your claim correctly will reduce the chance of any delayed or wrong payments.

These steps should help keep the process as simple as possible:

  • read the guidance before you apply, to find this go to GOV‌.UK and search for ‘Coronavirus Job Retention Scheme’, there’s a step-by-step guide to applying and a calculator
  • check your employees are eligible, by looking at the guidance on GOV‌.UK
  • check your calculations each time you submit a claim, in case any details have changed
  • only submit one claim per pay period – you can’t submit another claim for overlapping periods; this means that in each claim you should include all furloughed employees paid during that period
  • if you have missing National Insurance numbers for employees, do try and find them so it doesn’t delay your claim; if an employee doesn’t have a National Insurance number yet, you should contact HMRC in order to complete your claim; go to GOV‌.UK and search for ‘get help with the Coronavirus Job Retention Scheme’ to find out how to contact us
  • double check all of the information in the claim before you submit it, including your bank details.

HMRC understand that sometimes you might make an error in your claim, and they’re working on a process to enable you to amend a claim. In the meantime, please don’t amend your next claim to reflect any errors that you may have made in a previous one, as this could delay payment. If HMRC spot an error then, where possible, they’ll contact you or your agent to correct the claim.

Find Out More In HMRC’s Recorded Webinars

Want more information? There are two HMRC webinars about the Coronavirus Job Retention Scheme on HMRC’s YouTube channel ‘HMRCgovuk’ – an overview of the scheme and a detailed session about how to make a claim.

This week HMRC have started contacting self-employed customers who they think could be eligible for the Self-Employment Income Support Scheme (SEISS), based on the information you provided in your 2018 to 2019 tax return. You can use HMRC online checker which will quickly confirm whether you are eligible and will give you a specific date from which you can make a claim.

https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

How To Use The Checker

To use the online checker, you will need your Unique Taxpayer Reference Number and National Insurance Number.

If you are eligible, you will be given a date, between 13 and 18‌‌ May, from which you can apply. This date is assigned randomly to help HMRC manage demand on the service, making sure that everyone who needs to make a claim can do so.

You will also be asked to provide your Government Gateway credentials (user ID and password) and check that your bank and contact details are up to date. This is important so that HMRC can remind you by email or text message when it’s your turn to make a claim.

If you don’t have Government Gateway credentials, you can set those up simply if you follow HMRC guidance and use the SEISS eligibility checker. There will be no requirement to wait for pins or codes through the post.

The Application Process

Goes live on 13‌‌ May

The application process will show how HMRC has calculated the grant you are due to receive.

If you wish to seek a review of this calculation, you can do so.  It’s important to note that the checker has an extremely high accuracy rate as HMRC use the data you have previously provided HMRC with.

Join HMRC Webinar To Find Out More

You can also join one of the HMRC live webinars for further information about the Self-Employment Income Support Scheme.

During these webinars they’ll cover an overview of the scheme, who can claim, how much you may be entitled to, how to claim, what happens after you have claimed and other support available. Choose a date and time.

Watch The Animation

HMRC have created a short animation to show, step by step, how to use the checker.

The grants are aimed at small businesses with ongoing property costs and will be administered by local authorities.

Grants of £25,000, £10,000 or any discretionary amount under £10,000 will be available to small firms that have demonstrably been impacted by Covid-19 but cannot access the small business grants previously made available to those who pay business rates.

While local authorities will be able to use their discretion when allocating the funds, they have been asked to prioritise businesses in shared spaces, regular market traders, small charity properties and bed and breakfasts that pay council tax rather than business rates.

<a href=”https://www.ft.com/content/ebe3cd38-e6a4-4642-b31c-460533f3ce26?fbclid=IwAR1sE-qMEBDdLk4o5wgbhqiLYGtTRuo8a41rkwX8HidbIhybb–dUQ5KkTM” target=”_blank”>Read Financial Times articles.</a>

Self-Employment Income Support Scheme

This week HMRC will start contacting people who may be eligible for the new Self-Employment Income Support Scheme.

If you are eligible, this scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £7,500.

The process is quick and easy for your clients to follow, but we are asking for your help in guiding them through the eligibility criteria and the process for checking and claiming.

You must complete the claim yourself.

See updated guidance on GOV‌.UK for information on eligibility, how you will make a claim and how HMRC calculate the grants.

Those who are ineligible

  • You may be able to:
  • delay VAT payments
  • delay their Self Assessment payment on account
  • arrange to pay their Self Assessment tax bill in instalments
  • get a payment from the Small Business Grant Fund
  • get a loan from the Business Interruption Loan Scheme or Bounce Back Loan
  • get Universal Credit
  • apply for Employment and Support Allowance (ESA)
  • apply for Child Benefit.

This is general guidance to advise you on what support you can provide for your employees.  It applies to any staff home-working due to COVID-19. The tax treatment will be different depending upon whether you provide these things for employees or reimburse purchases made by your staff.

  • Mobile phones and SIM cards (no restriction on private use) – You may provide a mobile phone and SIM card without a restriction on private use limited to 1 per employee.
  • Provision of Broadband – If an employee already pays for broadband, then no additional expense can be claimed. However, if a broadband internet connection is needed to work from home where one was not available previously then the broadband fee can be reimbursed by the employer and is non-taxable, as long as the broadband is provided for business and any private use must be limited.
  • Laptops, tablets, computers, and office supplies – are non-taxable, if mainly used for business purposes and not have significant private use.
  • Reimbursing expenses for employee purchased office equipment – is taxable
  • Additional expenses such as electricity, heating or broadband – Payment or reimbursement to employees of up to £6 a week (£4 a week to 6 April 2020) is non-taxable for the additional household expenses incurred when an employee is required to work from home.
  • Employer provided loans – A salary advance or loan to help an employee at a time of hardship counts as an employment-related loan. Loans provided with a value less than £10,000 in a tax year are non-taxable.
  • Temporary accommodation – Where an employee must self-isolate and cannot do so in their own home, employers are able to reimburse hotel expenses and subsistence costs. The expenses for accommodation and subsistence costs are taxable
  • Employees driving their own vehicle – You can pay Approved Mileage Allowance Payments (AMAPs) of 45p per mile up to 10,000 miles (25p per mile thereafter) for business miles free of tax and NICs.

The government has brought forward legislation to zero rate electronic publications in a move to make them more affordable for people confined to their homes or affected financially by coronavirus. Zero-rating was originally due to take effect on 1 December 2020 but now applies from 1 May. 

Zero-rating applies to the sale of:

  • books and booklets
  • brochures
  • pamphlets
  • leaflets
  • newspapers
  • journals and periodicals
  • children’s picture and painting books.

Exclusions

Zero-rating doesn’t apply to the following types of electronic publication, they remain standard-rated:

  • advertising –  where more than half the content is advertisements
  • audiobooks
  • intellectual property such as licences, plans, technical drawings, etc.

The government has passed emergency legislation to allow manufacturers and retailers to zero rate sales of personal protective equipment (PPE) made between 1 May and 31 July 2020. 

The zero rate applies to all PPE recommended for use by Public Health England’s guidance of 24 April 2020.

Note. Although the guidance was issued by Public Health England the zero rate applies to sales across the UK.

  • Qualifying products. The temporary zero rate applies to sales, including those made from existing stock, of items such as disposable gloves, plastic aprons and fluid-resistant coveralls or gowns, surgical masks, eye and face protection such as single or reusable full-face visors or goggles.

 

  • The main purpose of the measure is to reduce the cost of PPE for nursing and care homes, as well as individuals, who usually aren’t entitled to recover the VAT paid on such purchases.