In this week’s update we remind you of the reinstatement of the Statutory Sick Pay rebate scheme for certain employers and HMRC is now sending “nudge” letters to certain companies in the context of COVID-19 job retention scheme (“CJRS”) payments which are taxable income for corporation tax purposes.
HMRC “nudge” letters
We understand that HMRC is currently issuing what is known as “nudge” letters to companies in scenarios where HMRC has not been able to reconcile the CJRS grants paid to those companies with those disclosed in the company accounts and accompanying corporation tax returns and computations.
By way of reminder, In respect of the taxation of COVID-19 supports for corporation tax purposes, HMRC’s message is as follows:-
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“Coronavirus grants and payments to support businesses during the pandemic are taxable.
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We want to make sure you have the latest information so you can help your clients complete their Company Tax Return (CT600) accurately.
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If your client needs to complete a Company Tax Return and has claimed Coronavirus Job Retention Scheme (CJRS) grants, Eat Out to Help Out (EOHO) payments, or any support payments made by local authorities and devolved administrations, they’ll need to report this as income when they calculate their taxable profits.
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If a Company Tax Return has already been filed, and coronavirus support grants or payments have not been declared as taxable income, an amended return will need to be submitted.
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If you are completing a Company Tax Return on your client’s behalf, you will need to check with them to confirm what coronavirus grants and payments they received. This is particularly important if another agent made a CJRS claim on their behalf, or your client claimed a grant themselves.
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How to report grants and payments
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If your client received a CJRS grant and/or an EOHO payment, this will also need to be reported separately in the specific boxes provided on the CT600.
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Boxes 471, 472 and 647 will need to be completed with the relevant amounts for the accounting period covered by the return, and boxes 473, 474 and 526 will need to be completed if there were any CJRS or EOHO overpayments.
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These boxes were added to the CT600 on 6 April 2021. If your client received a CJRS grant, EOHO payment and their return was filed before 6 April 2021, or after that date but without completing the relevant boxes, your client’s return will need to be amended.
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If all coronavirus support overpayments were already repaid or have already been assessed before the tax return was filed – and there’s no coronavirus support schemes overpayment remaining due for payment – there’s no need to amend the return. More information on this is available in the Company Tax Return guide.
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Statutory Sick Pay (“SSP”) rebate scheme
The Statutory Sick Pay (“SSP”) rebate scheme was relaunched recently and the updated guidance is now available. Employers can reclaim up to two weeks’ SSP they have paid to their employees, at the relevant standard weekly rate of £96.35, for any eligible periods of coronavirus-related sickness from 21 December 2021. HMRC has sent the below reminder about the scheme’s relaunch which also provides details of a forthcoming webinar.
“The Statutory Sick Pay Rebate Scheme (SSPRS) has been temporarily reintroduced to support employers facing heightened levels of sickness absence due to COVID-19.
Small or medium-sized employers with under 250 employees may be eligible to claim Statutory Sick Pay (SSP) costs for up to two weeks per employee for COVID-19 related absences from 21 December 2021. Agents are able to submit claims on behalf of their clients.
While this is a reintroduction of the scheme which ran until 30 September 2021, it is a new claims period, which means your clients can claim for eligible employees whether or not they claimed for them under the previous scheme.
Make sure you have the latest information by joining our webinar, COVID-19 Statutory Sick Pay Rebate Scheme 2, which includes:-
- who can claim for SSPR;
- when to start paying SSP;
- what you can claim under SSPR;
- making a claim;
- connected companies or charities; and
- recording keeping.
During this interactive webinar you can ask questions using the on-screen text box and download handouts giving detailed examples and links to more information. Unfortunately, we are not able to give advice or discuss personal circumstances.
Register here.
Afterwards we’ll also send you a link to a video recording of the webinars in case you'd like to see any of it again.”
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