The coronavirus pandemic is a fast-moving global situation with many businesses across the UK affected. The UK Government, NI Assembly and HMRC are acting and have produced guidance for businesses and employers and employees setting out the various measures of support announced. There is also a dedicated page for NI businesses. General advice on the UK Government response is also available and includes helpful advice for different sectors.
We recommend you bookmark the relevant pages on GOV.UK on your web browser to ensure you’re getting the most up to date information and guidance over the coming weeks and months.
The COVID-19 pandemic has struck hard at many sectors of business. Most will find a way through the crisis through a combination of perseverance, innovation and ingenuity. Accountants, with their expertise in financial planning, accessing finance, restructuring businesses, and applying for state aid are at the forefront of helping businesses. Accountants should develop an expertise and a familiarity with these resources.
To support our members, we have put in place a range of information. As most businesses will need finance, access and availability of adequate and timely finance will be crucial to the economic recovery going forward. On this page we provide a guide to the broad and expanding range of capital supports available. Some are schemes offering working capital loans or grants; others are for industry sectors particularly hard hit by the crisis.
We have gone through the key supports available and categorised them in a format that is useful to an accountant seeking to identify the most appropriate form of finance. Please note that this list is not comprehensive and that the supports available are constantly changing. Members are advised to keep an eye on developments and refer to the source documentation where necessary.
Last updated: 10 December 2021
Tax
Tax section last updated: Monday, 9 August 2021
We continue to update the pages dedicated to the UK Coronavirus Job Retention Scheme and the UK Self-Employed Income Support Scheme.
The Chancellor announced his ‘Winter Economy Plan’ in September 2020. Budget 2021 was held on Wednesday 3 March 2021. Both of these events announced extensions to many of the key COVID-19 HMRC administered supports.
Several of the measures announced by the Chancellor in the September 2020 ‘Winter Economy Plan’ and Budget 2021 were recommendations of this Institute in the Next Financial Year position paper published in July 2020.
- Further extension of UK Coronavirus Job Retention Scheme
- UK Self-Employment Income Support Scheme ("SEISS") grant 5
- UK VAT cut for tourism and hospitality sector further extended
- UK Self-Assessment - Time to Pay extension facility
- UK VAT - payment deferral scheme now closed
- HMRC Time to Pay helpline
Further extension of UK Coronavirus Job Retention Scheme
The Coronavirus Job Retention Scheme (“CJRS”) was due to end on 30 April 2021 however the Chancellor extended the scheme for a further five months in Budget 2021 to 30 September 2021. For the extended months of May-June 2021 inclusive the Government continued to pay 80 per cent of the salary of employees for hours not worked and there will be no employer contributions required beyond employers NIC and pensions in the months of April, May and June. This effectively meant no change was made to the regime until 1 July 2021.
From 1 July 2021, the Government introduced an employer contribution towards the cost of unworked hours of 10 percent in July, 20 percent in August and 20 percent in September, as the economy reopens. This is in addition to the employers NIC and pensions already required. The level of maximum grant also reduces each month.
Employees will continue to receive 80 percent of their current salary, capped at £2,500 per month, for hours not worked until 30 September 2021. Hours worked should be paid as normal by the employer.
From November 2020 onwards, claims for each month must be submitted by 11.59pm on the 14th day after the month end (unless this falls on a weekend in which case the deadline is 11.59pm on the next working day).
On a monthly basis HMRC is now publishing the names, an indication of the value of claims and Company Registration Numbers (for those who have one) of employers who make CJRS claims for periods from December 2020 onwards. Employees are also able to check if their employer has made a CJRS claim on their behalf through their online Personal Tax Account.
However employers can ask HMRC not to publish their claim details if this could leave individuals at risk of violence or intimidation and the employer is able to provide evidence to support this. HMRC will also accept applications from agents on behalf of employers not to publish if this is supported by the appropriate evidence.
Read more about the CJRS on our dedicated page.
UK Self-Employment Income Support Scheme ("SEISS") grant 5
Applications for the first four grants are now closed. Brief details of SEISS grant 5 were first announced in Budget 2021.
Self-employed individuals must have filed a 2019/20 self-assessment tax return which must have been filed by midnight on Tuesday 2 March 2021. This means that SEISS grant 5 may be able to be claimed by the newly self-employed in 2019/20, subject to the relevant criteria being met. All other eligibility criteria must also be met including the turnover test as follows:-
- anyone whose turnover has fallen by 30 percent or more will continue to receive the full grant worth 80 percent of three months’ average trading profits, capped at £7,500; and
- anyone whose turnover has fallen by less than 30 percent will receive a 30 percent grant, capped at £2,850.
The online claims service for SEISS grant 5 does therefore ask for the taxpayer’s turnover for the year April 2020 to April 2021 (the ‘pandemic year’) and the tax year 2019/20 (the ‘reference period’) – or the tax year 2018/19 if 2019/20 was not a normal year for their business.
Applications for SEISS grant 5 opened from late July.
You can also read more about the SEISS on our dedicated page.
UK VAT cut for tourism and hospitality sector further extended
Budget 2021 announced that the 5 percent VAT rate for the tourism and hospitality sectors which was due to end on 31 March 2021 is further extended and will remain at 5 percent until 30 September 2021. To help businesses manage the transition back to the standard 20 percent rate, a 12.5 percent rate will apply for the subsequent six months until 31 March 2022.
UK Self-Assessment - Time to Pay extension facility
Any taxpayer unable to pay their 2019/20 self-assessment (“SA”) tax bill in full by 31 January 2021 due to COVID-19 is able to set up a Time to Pay ("TTP") payment plan of up to 12 months online (via monthly direct debit payments) without needing to contact HMRC.
Taxpayers with SA tax debts up to £30,000 and who need extra time to pay can now access this TTP facility and get automatic and immediate approval. Those with SA debts over £30,000, or who need longer than 12 months to repay their debt in full are still able to set up a TTP arrangement but they must contact HMRC to set it up. These enhanced TTP mechanisms were a recommendation of this Institute which the Chancellor announced in his September 2020 Winter Economy Plan.
More information is available on GOV.UK.
UK VAT - payment deferral scheme now closed
The VAT deferral new payment scheme opened in February for businesses who deferred VAT due between 20 March 2020 and 30 June 2020 and still have payments to make, or who were unable to pay in full by 31 March 2021. This includes those on Payment on Account and Annual Accounting schemes. Businesses must have applied on or before 21 June 2021 if they wanted to join the scheme and further defer this VAT to benefit from making the payment over 8 instalments.
Failure to make payment of the deferred VAT in full or to make an arrangement to pay by 30 June 2021 may result in a 5 percent penalty, according to the guidance.
More details are available on GOV.UK.
HMRC Time to Pay helpline
HMRC has established a dedicated helpline set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities receive support with their tax affairs.
Through this, businesses may be able to agree a bespoke Time to Pay arrangement. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s dedicated helpline on 0800 024 1222.
HMRC has also stated that it will also waive late payment penalties and interest where a business experiences administrative difficulty contacting HMRC or paying taxes due to COVID-19.
These pages are provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.