This month’s COVID-19 tidbits, 21 December 2020

Dec 21, 2020

HMRC and the UK Government continue to publish updates on COVID-19 related issues. When using a form or publication going forward or contacting HMRC, check you are using the most recent version or up to date way of contact which may have changed due to the pandemic.

 

  • HMRC is advising businesses who want to further defer VAT due between 20 March 2020 and 30 June 2020 that they must opt-in to do so 31 March 2021. The online opt-in process is expected to be available early 2021;
  • Applications for VAT refunds by businesses established outside the EU for the year ended 30 June 2020 must be made by 31 December 2020. HMRC has agreed that due to the pandemic, overseas businesses are allowed an additional 6 months to submit a valid certificate of status, which means the certificate of status must be submitted on or before 30 June 2021. However, the application for VAT refunds and all other documentary evidence required to process claims must still be submitted on or before 31 December 2020;
  • The Income Tax (Exemption of Minor Benefits) (Coronavirus) Regulations, SI 2020/1293 takes effect for tests provided on or after 8 December 2020 but before the end of tax year 2020/21. This provides an income tax exemption where an employee is provided with a COVID-19 antigen test by their employer which means no benefit in kind charge will arise. It should be noted however that this exemption does not cover anti-body tests;
  • The Government is also to introduce a temporary income tax exemption and National Insurance contributions (NICs) disregard, to ensure that employees who purchase their own COVID-19 swab tests, and are reimbursed by their employer, will not attract income tax and NICs liabilities in the current tax year. Further information about this measure will be published shortly; and
  • From 6 April 2020, non-resident companies became chargeable to corporation tax instead of income tax on their UK property income. HMRC has now updated the guidance on quarterly instalment payments to confirm, for the accounting period beginning 6 April 2020, i.e. the first accounting period for corporation tax, that the quarterly instalment payments regime will not apply even if the company is ‘large’ or ‘very large’. However it will apply as normal to the next and all subsequent accounting periods.