The below update is from HMRC an provides useful updates on the Self-Employment Income Support Scheme as well as updated guidance on the Job Retention Scheme.
The government has set up a dedicated support page where businesses can find the right support, advice and information to help with the impact of coronavirus.
Self-Employment Income Support Scheme
This week we will start contacting customers who may be eligible for the new Self-Employment Income Support Scheme.
The scheme will allow your constituents to claim a taxable grant worth 80% of their average trading profits up to a maximum of £7,500, equivalent to three months’ profits.
Constituents can claim if they’re a self-employed individual, or a member of a partnership, their business has been adversely impacted by coronavirus and they:
- traded in the tax year 2018 to 2019 and have submitted their Self Assessment tax return for that year on or before 23 April 2020
- traded in the tax year 2019 to 2020
- are trading when they apply – if they’ve temporarily stopped trading because of coronavirus they will still be classed as trading by HMRC
- intend to continue to trade in the tax year 2020 to 2021
Their trading profits must also be no more than £50,000, and at least half of their total income for either:
- the tax year 2018 to 2019
- the average of the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019
To help constituents prepare to claim, we have published updated guidance, which clarifies the eligibility criteria, the application process and how the grant is calculated.
We’d ask at this busy time that people only call us if they cannot find what they need on GOV.UK or via webchat.
Contacting eligible customers
This week we are starting to contact self-employed customers who we think could be eligible based on the information they provided in their 2018 to 2019 tax return, via email, SMS or letter, to invite them to use our new online checker to see the date from which they can make a claim.
We are encouraging agents to help their clients to use the eligibility checker themselves, or if necessary, to use the checker on their behalf, and then help them understand the result, including recommending other sources of support if they are not eligible.
To use the eligibility checker, your constituent they will need their:
Self Assessment Unique Taxpayer Reference (UTR)
National Insurance number
If the checker confirms your constituent is eligible, they will be given a date between 13 and 18 May when they can first use the online system to make a claim. Please note these dates are allocated randomly by HMRC – it is not ‘first come, first served’ so the date the eligibility checker is used has no impact on when the system opens for claims from a customer.
Constituents should then log onto their Government Gateway account with their user ID and password. Your constituent will be able to update their contact details at this point, and these details will be used to email or text message them a reminder of when they can come back to make their claim.
If they do not have a Government Gateway Account, they can create one when they check their eligibility online.
Making a claim
The process has been designed to be as simple as possible. HMRC will have done all the calculations for your constituents already.
We will contact eligible people between 13 and 18 May, on the day they can apply, to remind them the system has opened for them to submit their claim (as above, the dates people can apply will be staggered to allow the system to cope with demand).
To receive money via the Self-Employment Income Support Scheme, constituents will need to go to GOV.UK on (or any time after) their allotted day to submit their claim. Your constituents should again enter their UTR, National Insurance Number and Government Gateway password and user ID and additionally provide their bank account details. They will also have to confirm that their trading profits have been adversely affected by Coronavirus.
Customers who consider themselves to be digitally excluded and therefore unable to apply online, will be invited to contact HMRC by telephone. An HMRC advisor will make a claim on their behalf using the SEISS system.
Applications will be risk-assessed based on the eligibility criteria and we will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate.
A review process will be in place for those who do not agree with HMRC’s eligibility assessment or calculation of their grant.
The scheme allows people to claim a taxable grant worth 80% of their trading profits up to a maximum of £7,500 equivalent to three months’ profits. If the claim is approved it will be paid directly into their bank account within six working days of submitting a claim, paid in a single instalment.
The online system will tell your constituents how much they will be paid and how HMRC calculated that amount (based on their previous tax returns).
How tax agents can support their clients
Tax agents can play an important role in supporting their clients by helping them get ready to claim by
- Talking them through why they may / may not be eligible
- Helping them to find the details they need
- Using the online eligibility checker on their behalf (or supporting them to use it themselves).
Under the rules of the scheme, not every self-employed person will be able to claim, and we’d value the support of agents in being their clients’ first port of call to help them understand this.
Agents can check GOV.UK for information on eligibility, how to make a claim and how we calculate the grants.
Job Retention Scheme Guidance
We have updated our Coronavirus Job Retention Scheme Guidance in response to feedback we received.
- The guidance for employees is available on GOV.UK and now contains various updates including information on:
- Parental bereavement and statutory leave
- What can be included in wages
- Employees who are union or non-union representatives continuing work specific to that role while on furlough
- Company Directors with an annual pay period.
- Clarified that the calculator can’t be used for those who “have an annual pay period”
- Clarified wording in the employees returning from family-related statutory leave section and sick pay section.
- Added the June daily maximum wage rates to the table now the scheme has been extended.
- Improved clarity in the employer National Insurance contributions section, confirmed the direct percentage, method or tables method can be used and added new information for company directors.
VAT scrapped on E-publications
Plans to scrap VAT on e-books and e-newspapers have been significantly fast-tracked in a boost to readers and publishers during the coronavirus outbreak, the Chancellor announced on 30 April 2020.
Rishi Sunak said the zero rate of VAT will now apply to all e-publications from 1 May 2020 – seven months ahead of schedule – potentially slashing the cost of a £12 e-book by £2 and e-newspapers subscriptions by up to £25 a year.
In support of the print newspaper industry, the government has also announced it will be spending up to £35 million on newspaper advertising over the next 3 months as part of its coronavirus communications campaign to ensure the whole UK is aware of the latest government guidance and advice.
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Treasury cut taxes to reduce PPE costs
VAT on essential personal protective equipment (PPE) for coronavirus will be temporarily scrapped saving more than £100 million for care homes and businesses dealing with the outbreak, the government has announced.
From 1 May 2020, PPE purchased by care homes, businesses, charities and individuals to protect against coronavirus will be free from VAT for a three-month period. We have already removed import duties from PPE to make sure more essential equipment can get to the front line quicker.
The government has acted as soon as possible to bring the measure into force. EU law governing VAT – which the UK is bound to until the end of the transitional period – requires the UK to charge VAT on the equipment.
We are aware of an increase in scam emails, calls and texts. Eligible customers will be invited to claim through GOV.UK – it is the only service they can use. If someone gets in touch claiming to be from HMRC, saying that financial help can be claimed or that a tax refund is owed, and asks them to click on a link or to give information such as their name, credit card or bank details, they should not respond. It is a scam.
Suspicious emails claiming to be from HMRC should reported to us by sending them to: firstname.lastname@example.org. Texts should be sent to 60599.