Gradually, we are seeing further information and guidance being released by Government which is helping to answer our clients’ questions and provide more clarity and certainty around the raft of economic reliefs and financial support made available due to COVID-19.
Coronavirus Job Retention Scheme (CJRS)
The full details of CJRS can be found here: https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme
From this guidance, we believe the following insights and points to be most relevant to our clients.
This includes confirmation that if:
- you are an agency worker or employee of an Umbrella company
- you are a company director
- you are a salaried member of a Limited Liability Partnership (LLP)
- you are a Limb (b) worker
- you are an office holder
…then you may be eligible to be furloughed and receive a grant of 80% of your regular wages, up to a monthly cap of £2,500, if you are paid via PAYE.
As with any furloughed employee, the furlough should be agreed between the employer – whether that is an Agency, Umbrella Company, LLP, Limited Company – and the worker.
Workers should not perform any work duties for the employing business – be that Agency, Umbrella Company, LLP etc. – while they are furloughed.
Where Limb (b) workers are paid through PAYE, they can be furloughed and receive support through this scheme. Those who pay tax on their trading profits through Income Tax Self-Assessment may instead be eligible for the Self-Employment Income Support Scheme (SEISS).
There is now written clarification that a furloughed director can carry out particular duties to fulfil their statutory obligations, which includes finalising company accounts for filing purposes. This is particularly comforting for those sole director companies who manage both business and statutory obligations.
If you have any questions regarding CJRS or the prospect of furloughing team members, please speak to your Champion contact.
Logistical issues dealing with HMRC during COVID-19
Dealing with HMRC can be tricky, and is providing even more so during COVID-19.
We understand that HMRC is expected to publish broader guidance about changes to help with tax administration during the Coronavirus pandemic, but for now, the following problems have been highlighted and corresponding solutions proposed.
Most of the practical issues centre on communicating and transacting with HMRC. These include difficulties for taxpayers and agents, together with HMRC’s ability to send and receive post, problems with submission of forms and returns, and dealing with enquiries such as appeals and penalties.
HMRC recognises these problems and hopefully will have updates for us soon.
In the meantime, if you have questions or concerns then please let Champion know as we can help.
HMRC online services
Where possible, agents and taxpayers should use HMRC’s online services to help reduce the pressure on the system.
Unfortunately, the services available to agents are more limited than those provided to taxpayers. This means that businesses wishing to claim grants through CJRS or SEISS are likely to need access to their business tax account to commence the process.
We hope that HMRC will grant agents access, but this may not be possible in the short-term because of development pressures facing the Government portal.
It, therefore, will most likely require a combined effort between agent and client. In response, we will continue to support our clients to get any reliefs moving.
We have also seen clients encounter challenges logging on to their digital tax account if the two-step verification code goes to a landline or other phone number that is no longer being answered and accessible.
In such instances, the solution is to phone HMRC’s online services helpdesk and ask them to remove the existing phone number. The number for this is 0300 200 3600.
The next time the individual attempts to log in, they will then be asked to set up a new phone number on the account. This process has been in place for some time for situations such as someone changing their mobile phone number.
Some HMRC services require an authentication code to be sent by post when the service is being set up for the first time and with the postal delays, receipt of this code may be a problem.
HMRC helplines
HMRC helplines are under significant pressure due to staff shortages and increased demand.
The hours on all lines have been reduced to 08:00 to 16:00 and they are closed at weekends. HMRC has, however, advised that these lines tend to be least busy between 08:00 and 10:00.
HMRC has set up a specific helpline for businesses struggling to pay their tax due to COVID-19, but reports from members indicate that this line also has the insufficient resource to meet the demand.
HMRC also recommends that businesses wait until just before their tax is due before contacting its team to discuss Time to Pay. However, sending HMRC a letter to inform them of your circumstances and intentions, sooner rather than later, will ensure a note is left on your file which can be referred to when you do call.
It is not necessary to contact HMRC to defer VAT payments or Self-Assessment payments on account – the deferral is automatic and you do not need to notify HMRC.
If you are worried about Time to Pay arrangements, please speak to your Champion contact and let us help you manage the problem.
Written communication
HMRC’s post rooms remain open, but delays are to be expected.
Whilst email options have not yet been extended to more high-volume transactions, we are hopeful that HMRC will soon move towards more electronic-based communications.
Some forms and returns can only be submitted in paper form e.g. P11Ds and CT61s, which may pose problems and delays. Wherever possible, forms or returns should be filed online. This is particularly important if an individual or business wishes to claim a refund for 2019/20.
As always, the Champion team remains on hand to support. For more information and guidance, please contact your Champion advisor.
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