Dear Payadvice Ltd,
I’m writing to you with the latest information about financial support schemes available to help your clients as part of the UK Government’s Plan for Jobs. This includes the latest on the Self-Employment Income Support Scheme (SEISS), the Coronavirus Job Retention Scheme (CJRS) and the VAT deferral new payment scheme.
Thank you for providing invaluable support to your clients during these challenging times, including to potentially vulnerable customers who can also seek help from our Extra Support Team.
VAT deferral – apply now to spread your payments
The VAT deferral new payment scheme is open for all businesses who deferred paying VAT due between 20 March and 30 June 2020 and have been unable to pay in full by 31 March 2021.
Your clients can apply now to spread these payments over a number of months – businesses that join by 21 April 2021 will be able to benefit from up to 10 monthly instalments. The sooner businesses join, the more instalments are available to them.
Businesses can join the scheme quickly and simply online without needing to call HMRC. To find out more information, including the things your clients need to prepare before joining online, go to GOV.UK.
Businesses need to apply by 21 June 2021 at the latest if they want to join the scheme online.
CJRS claims for April
You can now submit CJRS claims for periods in April. These must be made by Friday 14 May.
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
What you or your clients need to do now
- If you haven’t submitted your client’s claim for March but believe there is a reasonable excuse for missing the 14 April deadline, check if you can make a late claim on GOV.UK.
- Submit any claims for April no later than Friday 14 May.
- Keep records that support the amount of CJRS grants claimed, in case HMRC needs to check them.
Employers must pay the associated employee tax and National Insurance contributions to HMRC. If they don’t do that, they’ll need to repay the whole of the CJRS grant to HMRC.
The UK Government will continue to pay 80% of furloughed employees’ usual wages for the hours not worked, up to a cap of £2,500 per month, to the end of June.
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 pay the difference from July, so that they continue to pay their furloughed employees at least 80% of their usual wages for the hours they do not work during this time, up to a cap of £2,500 per month.
CJRS eligibility from May
If your clients have employees who have previously been ineligible for the CJRS, as they were not on their payroll on 30 October 2020, they may be eligible for periods from 1 May 2021 onwards.
From May 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.
Your clients and their employees do not need to have benefitted from the scheme before to make a claim, as long as they
Changes to CJRS claims for variable pay from May
For periods from 1 May, when calculating the average wages for employees who are not on a fixed salary, you should know longer include periods of:
- Statutory Sick Pay related leave
- family related statutory leave
- reduced rate paid leave following a period of Statutory Sick Pay or family related leave.
However, if an employee was on one of these types of leave for the entire period used to calculate their average wages, then you should continue to include the days and wages related to that leave.
For more information on variable pay calculations, go to GOV.UK.
Frequently asked questions about the CJRS
Can my client still use the CJRS if they’re starting to re-open their business?
Your client can continue to use the CJRS if their business is affected by coronavirus. They don’t need to place all their employees on furlough. They can also use the CJRS flexibly to bring their employees back to work for some of their usual hours. They can claim for a portion of the usual wage costs for the hours spent on furlough.
Can a CJRS grant be used to pay for holiday leave?
If employers have furloughed employees because of the effects of coronavirus on their business, they can claim under the CJRS for periods of paid leave their employees take while on furlough, including for bank holidays. Employers should not place employees on furlough just because they are going to be on leave.
If an employee is furloughed for only some of their hours, employers can count time taken as holiday as furloughed hours, rather than working hours. This means employers can currently claim for 80% of their employees’ usual wages when they’re on leave.
In line with the Working Time Regulations, if a furloughed employee takes holiday, employers should make sure they are calculating the correct holiday pay, and not simply continuing to pay the 80% they receive through the CJRS. They may need to top up their employees’ pay to 100% of their normal hourly rate or salary. You can find more information on GOV.UK.
Self-Employment Income Support Scheme
The online service for claiming under the latest phase of the Self-Employment Income Support Scheme (SEISS) will open in the next few days. To support you in helping your clients, here are the latest updates on the scheme and details of when we’ll be contacting customers.
Customers receiving their personal claim dates
We have begun contacting eligible customers to give them a personal claim date, from which they can make their SEISS claim. We have contacted them either by email, letter or through the online service, depending on what contact details we hold.
Customers can make their claim from this personal claim date in late April, until the claims service closes at 11:59pm on 1 June 2021.
Please remind your clients not to claim SEISS before their personal claim date.
If you have clients who believe they are eligible for the scheme but are yet to hear from us, please ask them to wait until the end of the month before contacting us. We are inviting customers to claim on different days to ensure the system is fast and easy to use, so we can support millions of people quickly and easily.
Contacting ineligible customers
We have also contacted customers who have previously claimed SEISS support but are no longer eligible. There are a number of reasons for ineligibility, for example:
- not filing their 2019-20 Self Assessment return on or before 2 March 2021
- if the information on their 2019-20 Self Assessment return means they no longer meet the eligibility criteria,
- if they’ve permanently ceased trading.
We know many of you will be supporting your clients to help them understand the amount of the grant they’ll receive. If you and your client believe that we have incorrectly assessed their eligibility, or the amount of their grant, they should follow the advice provided in the email or letter we sent. They will either be asked to log into the claims service using their Government Gateway credentials or, if we consider they are ineligible for the SEISS, they can use the online assistant to find out why. If your client still needs help after following this advice, they can get support from the COVID-19 helpline.
As before, please do not submit review requests on behalf of your clients, as this can lead to delays. We can only discuss SEISS claims with the individual customer.
Getting your clients ready to claim SEISS grants
Customers will be able to claim at any time from their personal claim date in late April until 1 June, at the latest. In order to claim, they will need to log in to their Government Gateway account with their user ID and password. If they do not have a Government Gateway account (for example, customers who are newly self-employed), they should create one now to avoid delaying their claim.
To confirm their eligibility and make their claim, your clients will need their:
- National Insurance number: If your client doesn’t know this, they can go to the HMRC app or access their online Personal Tax Account (PTA).
- Self Assessment Unique Taxpayer Reference (UTR) number: your client can find this on their Self Assessment papers or their PTA.
- Government Gateway user ID and password: To avoid delays, please ensure your clients check that they can log in to the Government Gateway before their personal claim date. If your client doesn’t have an account, or has forgotten their details, they can follow the instructions on GOV.UK by searching ‘HMRC services: sign in or register’. Please also ensure your client checks that their contact details are correct in their Government Gateway account.
- Bank account number and sort code: For a building society account, your client should include the roll number, if they have one.
We will also ask for the address that your client’s bank or building society account is registered to. Please note this is your client’s address – most likely their home or business premises – not the address of their bank or building society.
As with previous SEISS grants, you cannot make a claim on behalf of your clients, or use their log in details, as this will trigger a fraud alert and result in significant delays to your client receiving payment. We are grateful for your continued support in helping your clients to understand the eligibility criteria, and for getting your eligible clients ready to submit their claims personally.
Customers are also required to keep appropriate records as evidence of the impact on their business.
If your client hasn’t claimed before
If this is your client’s first time claiming a SEISS grant, they may be asked additional questions to prove their identity.
Questions could relate to any of the following:
- their UK passport
- information held on their credit file (such as loans, credit cards or mortgages)
- their Self Assessment tax return (within the last three years)
- their tax credit claim
- their P60
- one of their three most recent payslips.
Thank you for your support in helping to ensure your client has the information ready when making their claim.
Their claim may be delayed if they cannot answer the identity verification questions.
In order to claim the fourth grant, customers must reasonably believe that they’ll suffer a significant reduction in trading profits, due to reduced business activity, capacity, demand or inability to trade due to coronavirus between 1 February 2021 and 30 April 2021. They must keep evidence that shows how their business has been impacted by coronavirus resulting in less business activity than otherwise expected.
HMRC expects customers applying for SEISS four to make an honest assessment about whether they reasonably believe their business will have a significant reduction in profits.
Before making a claim, a customer must decide if the impact on their business between 1 February 2021 and 30 April 2021 will cause a significant reduction in their trading profits for the tax year they report them in.
HMRC cannot make this decision for your clients because individual and wider business circumstances will need to be considered when deciding whether the reduction is significant.
Customers should wait until they have a reasonable belief that their trading profits are going to be significantly reduced, before they make their claim.
Customers do not have to consider any other coronavirus scheme support payments that they have received when deciding if they’ve had a significant reduction in their trading profits.
There are some examples that you and your clients can use to help you decide.
Amendments to 2019-20 SA returns after 3 March 2021
If you or a client makes, or has made, an amendment to their 2016-17, 2017-18, 2018-19 or 2019-20 tax return on or after 3 March 2021, HMRC must be notified within 90 days if the amendment either:
- lowers the amount of SEISS grant your client is eligible for
- causes your client to no longer be eligible for a SEISS grant.
Your client may need to pay back some or all of the grant. If we are not notified, we will contact your client after the deadline for making amendments to tell them what amount they may need to pay back.
If HMRC is not notified within 90 days, the customer may also have to pay a penalty.
HMRC does not need to be notified if either:
- the amount they’re eligible for is lowered by £100 or less
- they are no longer eligible and the grant they received was £100 or less.
If you’re not sure if your client’s grant amount has been reduced your client should contact HMRC for further help. Please search ‘Get Help with SEISS’ for contact details.
Where can I get further support?
Many agents have benefitted from our webinars which offer information on the CJRS and SEISS, other government support and how it applies to your clients. We have a series of live webinars about claiming the fourth SEISS grant. You and clients can watch our videos and register for our webinars to learn more about the support available.
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 to allow space for others to register.
For the CJRS, there’s also list of monthly claims deadlines and a helpful step by step guideon GOV.UK, summarising the latest information on the CJRS and the steps you need to take to make a claim.
Find out what other government financial support may be available for you and your business as part of the UK Government’s Plan for Jobs on GOV.UK.
A word about scams
We are aware of recent increases in scam phone calls, emails and texts. If someone contacts you claiming to be from HMRC saying that you owe tax and face arrest, are due a tax refund, that your National Insurance number has been compromised, or asking you to transfer money, or for bank or other personal details, it might be a scam.
Search GOV.UK for our ‘scams checklist’ and to find out how to report tax scams. You can also access the National Cyber Security Centre’s new guide on how to stay secure online and protect yourself or your business against cybercrime by searching ‘Cyber Aware’.
Our Taxpayer Protection Taskforce is tackling the minority who deliberately claim money they’re not entitled to. If you suspect fraud, please report it using our online form. Go to GOV.UK and search ‘Report fraud to HMRC’ for more information.
Chief Executive and First Permanent Secretary – HMRC