I’m writing to you with the latest information about the financial support schemes available to help your clients. This includes updates on the VAT deferral new payment scheme, the latest on the Self- Employment Income Support Scheme (SEISS) and the Coronavirus Job Retention Scheme (CJRS).
- VAT deferral – apply now to spread your payments
- Self-Employment Income Support Scheme
- You can now make CJRS claims for March
- Extension to the CJRS
- Frequently asked questions
- Where can I get further support?
- Protect yourself from scams
VAT deferral – apply now to spread your payments
The VAT deferral new payment scheme is open for all businesses who deferred VAT due between 20 March and 30 June 2020 and still have payments to make, or who are unable to pay in full by 31 March 2021. This includes those on Payment on Account and Annual Accounting schemes.
Your clients can apply now to spread these payments over a number of months – the later businesses join the fewer instalments are available to them. Businesses should join by 19 March 2021 to benefit from the maximum number of 11 instalments.
Businesses can join the scheme quickly and simply online without the need to call HMRC. To find out more information, including the things your clients need to do before joining, go to GOV.UK.
Businesses need to apply by or before 21 June 2021 if they want to join the scheme online.
Self-Employment Income Support Scheme
HMRC contacted you on 3 March to let you know that the Self-Employment Income Support Scheme (SEISS) will continue until September with a fourth and fifth grant.
We wanted to take this opportunity to provide answers to some of the early questions that we have been asked. More information will be available on GOV.UK in due course.
Fourth SEISS grant – Eligibility and calculation
Much of the eligibility criteria remains unchanged from the third grant, with notable exceptions that an individual must:
- have submitted their 2019-20 tax return by 2 March 2021
- have trading profits that are at least nil (not a trading loss), based on their 2019-20 tax return, or an average of tax years 2016-17, 2017-18, 2018-19 and 2019-20
- have trading profits that are no more than £50,000 and at least equal to their non-trading income, based on their 2019-20 tax return, or an average of tax years 2016-17, 2017-18, 2018-19 and 2019-20
- have been trading in the tax years 2019-20 and 2020-21.
Full eligibility criteria can be found on GOV.UK.
The reasonable belief declaration which has been in effect for the second and third SEISS grants remains in effect. There is no turnover test for the fourth SEISS grant.
Claiming the fourth SEISS grant
We will contact potentially eligible customers from mid-April with a personal claim date. These customers can claim at any time from their personal claim date until the claims service closes on 31 May.
As with previous grants, you can offer your clients help and advice, but you cannot make a claim on their behalf as this will trigger a fraud alert and result in significant delays to your client receiving payment. We would appreciate your support in preparing any newly eligible clients for possible identity verification questions and creating a Government Gateway account.
Upcoming customer contact
We have moved quickly to ensure we have the information we need to check customers’ eligibility before applications are open, while also preventing fraudulent SEISS claims. Where we need to make further checks, we will write to customers and explain that we will call them to ask for proof of identity and evidence of trade. To make these calls, we will use the telephone number on the customer’s record. If this is their agent’s number, we will ask that you provide us with your client’s contact number as we need to speak to them directly. Thank you for supporting your clients with this process, which will help make sure we can verify their eligibility.
You can now make CJRS claims for March
You can now submit your CJRS claims for periods in March 2021. These must be made by Wednesday 14 April.
You can claim before, during or after your client’s payroll is processed. If you can, it’s best to make a claim once you’re sure of the exact number of hours your client’s employees will work so you don’t have to amend the claim later.
Check if your client and their employees are eligible and work out how much they can claim using our CJRS calculator and examples.
What you need to do now
- If you haven’t submitted your client’s claim for February but believe there is a reasonable excuse for missing the deadline, check if you can make a late claim on GOV.UK.
- Submit any claims for March no later than Wednesday 14 April.
- Keep records that support the amount of CJRS grants claimed, in case HMRC needs to check them.
Extension to the CJRS
As announced in the 2021 Spring Budget, theCJRS has been extended until the end of September 2021.
For periods from 1May2021 onwards, employers will be able to claim for eligible employees who were on their PAYE payroll on 2 March 2021. This means they must have made a PAYE Real Time Information (RTI) submission between 20 March 2020 and 2 March 2021, notifying HMRC of earnings for that employee.
The UK Government will continue to pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month, up to the end of June 2021.
For periods in July, CJRS grants will cover 70% of employees’ usual wages for the hours not worked, up to a cap of £2,187.50. In August and September, this will then reduce to 60% of employees’ usual wages up to a cap of £1,875.
Employers will need to continue to pay furloughed employees at least 80% of their usual wages for their hours they do not work during this time, up to a cap of £2,500 per month. This means, for periods between July and September, they will need to fund the difference between this and the CJRS grants themselves. Employers can also top up wages above the 80% if they wish, but they are not required to do so.
Employers must continue to pay Employer National Insurance contributions and pension contributions on subsidised furlough pay from their own funds.
Entering personal details
When submitting your clients’ claims, it’s really important to take care when entering their personal details so they’re accurate. To ensure their claim is processed and their grant is paid correctly, please take extra care to check that the bank account details you enter are correct. If you enter an incorrect sort code you will now be alerted to this in the online claims service, and the claim won’t go through.
Frequently asked questions
SEISS – Fourth SEISS grant
Have the eligibility criteria changed?
The eligibility criteria will now take into account 2019-20 returns submitted by 2 March 2021. This may mean that some of your clients no longer meet the eligibility criteria, for example, if their average trading profits were over £50,000 for both 2019-20 and on average across 2016-17 to 2019-20.
Eligibility criteria are initially assessed against the 2019-20 return. If the eligibility criteria (trading profits at least equal to non-trading income and not exceeding £50,000 in 2019-20) aren’t met, we look at the average of the four tax years (where available) and consider all eligibility criteria against this average.
Will there be an eligibility checker?
We want to help customers understand whether they will be eligible, especially as there are changes to the eligibility criteria. We are providing an online eligibility checker from mid-April, and as with the first SEISS grant, you can use this checker on behalf of your clients. The checker will confirm eligibility, but it will not give a specific reason if someone is ineligible (the customer will need to sign in to their Government Gateway account to find the reason, as this is personal information).
I didn’t submit my 2019-20 tax return by 2 March 2021, but I claimed earlier SEISS grants. Can I claim the fourth grant?
If someone did not submit their 2019-20 Self Assessment tax return by 2 March 2021, they will not be eligible for the fourth SEISS grant.
I didn’t trade in one or more of the tax years 2016-17 to 2019-20 – how will my grant be calculated?
The fourth SEISS grant will first assess individuals’ eligibility on the basis of their 2019-20 returns, and if ineligible on the basis of those returns, the average of relevant years between 2016-17 and 2019-20. For the purposes of calculating the average of relevant years; if there is a gap in returns (e.g. an individual filed in 2016-17, 2018-19 and 2019-20), we would only take into account the consecutive years afterthe gap in filing (in this example, 2018-19 and 2019-20).
I amended my 2019-20 tax return – will the amended figures be used to calculate my fourth SEISS grant?
Amended 2019-20 returns will be taken into account for SEISS, if they were received by 2 March 2021.
Should SEISS grants be included in the annual allowance calculation for private pensions?
Yes – the SEISS grant should be included in the calculation of relevant UK earnings when working out your annual allowance.
As we approach the end of the financial year, your clients may be making the calculations for their annual allowance for pensions contribution purposes. Please remind them that SEISS grants form part of taxable trading income and are considered relevant UK earnings to the extent that they are referable to the trade. As such, they should be included in the annual allowance calculation at s.190 FA04. Further guidance about the annual allowance is available on GOV.UK.
What support is there for new parents/those who took parental leave in 2019-20?
Self-employed parents who did not submit a tax return for 2019-20, or whose trading profits in 2019-20 were less than their other income and were therefore ineligible for the SEISS, because they were pregnant or taking time out of their trade to care for their new-born or newly adopted child, may still be eligible for the SEISS.
For new parents, we will assess eligibility using either their 2018-19 self-assessment return or an average of their 2016-17 to 2018-19 returns as the basis for their eligibility and grant calculation. They will also need to meet the other eligibility criteria for support under the SEISS.
This does not affect the grant calculation for those who submitted a 2019-20 return and are already eligible.
How long will it take to receive the grant?
As with previous SEISS grants, the money will be paid into your client’s bank account within six working days of making their claim.
What if I’ve claimed too much in error?
If you or your client has claimed too much CJRS grant and have not already repaid it, you can repay as part of your next online claim without needing to call us. If you or your client claimed too much but do not plan to submit further claims, you can let us know and make a repayment online through our card payment service or by bank transfer.
You or your client must notify us and repay the money by the latest of whichever date applies below:
- 90 days from receiving the CJRS money your client was not entitled to
- 90 days from the point circumstances changed so that your client was no longer entitled to keep the CJRS grant.
If you or your client do not do this, you may have to pay interest and a penalty as well as repaying the excess CJRS grant. More information on interest can be found on GOV.UK.
What if I haven’t claimed enough?
If you or your client has made a mistake in a claim that means they received too little money, you’ll need to amend it within 28 calendar daysafter the month the claim relates to – unless this falls on a weekend or bank holiday, in which case the deadline is the next weekday. The deadline to amend claims for February is Monday 29 March.
Find out how to amend a claim on GOV.UK.
You can find everything you need to know about the CJRS on GOV.UK,
Where can I get further support?
Many agents have benefitted from our webinars which offer information on the CJRS and SEISS, other support and how it applies to your clients. Go to help and support if your business is affected by coronavirus to book online, or to view updated guidance. If you’re booked on a webinar but can no longer attend, please cancel your place where possible to allow space for others to register.
There’s a list of monthly claims deadlines and a helpful step-by-step guide on GOV.UK, summarising the latest information on the CJRS and the steps you need to take to make a claim.
Protect yourself from scams
Stay vigilant about scams, which may mimic government messages as a way of appearing authentic. Search ‘scams’ on GOV.UK for information on how to recognise genuine HMRC contact. You can also forward suspicious emails claiming to be from HMRC to email@example.com and texts to 60599.
Access the National Cyber Security Centre’s guide on how to stay secure online and protect yourself and your business against cyber crime by searching ‘Cyber Aware’ on GOV.UK.
I hope this information helps you and your business, and we’ll continue to keep you updated.
Chief Executive and First Permanent Secretary – HMRC