COVID-19 support schemes – this week’s updates, 22 March 2021

Mar 22, 2021

Upcoming deadlines for the job retention scheme, the online VAT deferral process, action needed by some taxpayers by today Monday 22 March to access future SEISS grants, more information on the fourth SEISS grant, a reminder about fraud and scams and the latest FAQs all feature this week.

March 2021 CJRS claims

The deadline to submit  CJRS claims for periods in March‌‌ ‌2021 is Wednesday‌‌ ‌14‌‌ ‌April 2021, unless reasonable excuse is available for late submission. Amendments to February 2021 CJRS claims must be made by Monday 29 March 2021.

Check if your client and their employees are eligible and work out how much they can claim using HMRC’s CJRS calculator and examples.

VAT deferral – first deadline for maximising the spread of payments has now passed

The VAT deferral new payment scheme opened last month for businesses who deferred VAT due between 20 March 2020 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. Businesses must apply on or before 21‌‌ ‌June‌‌ ‌2021 if they want to join the scheme and further defer this VAT.

The later businesses join the fewer instalments are available to them. Businesses should have joined by 19‌‌ ‌March‌‌ ‌2021 to benefit from the maximum number of 11 instalments. The next deadline to apply by is 21 April 2021 to benefit from making the payment over 10 instalments.

SEISS emails

We understand that HMRC emailed some self-employed businesses at the end of last amount asking for proof they are still trading before they can claim the next two SEISS grants.  Failure to respond to that email by today Monday 22 March 2021 means that self-employed business will not be able to claim further SEISS grants.

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; and
  • have been trading in the tax years 2019/20 and 2020/21.

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.

HMRC will contact potentially eligible taxpayers from mid-April with a personal claim date. These taxpayers 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. HMRC is asking agents to provide support to newly eligible clients by assisting them with possible identity verification questions and creating a Government Gateway account.

HMRC has also moved quickly to ensure it has the information needed to check taxpayers' eligibility before applications are open, while at the same time preventing fraudulent SEISS claims. Where HMRC needs to make further checks, HMRC will write to taxpayers and explain that HMRC will call them to ask for proof of identity and evidence of trade. To make these calls, HMRC will use the telephone number on the taxpayer's record. If this is their agent's number, HMRC will ask that you provide your client’s contact number.

At a recent meeting with HMRC we stressed that anyone receiving such a call may be concerned that the call is not genuine and is a phishing attempt. HMRC is therefore examining potential safeguards to reassure taxpayers.

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 phishing@hmrc.gov.uk 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.

HMRC has also published an updated list of frequently asked questions on COVID-19 supports which are as follows:-

“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 after the 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.

CJRS

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 days after 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 – you can find these by searching 'Job Retention Scheme step by step guide'.”