Covid-19 – latest changes on the CJRS and SEISS support
Keep your clients fully informed of the latest changes.
Coronavirus Job Retention Scheme (CJRS)
As has already been announced, the scheme now allows for employees to be flexibly furloughed from 1 July and employers can continue to claim for periods when employees are not working. For any furlough periods up to 30 June 2020, the last day for making claims is 31 July 2020.
HMRC has clarified that employees who are being made redundant and are serving their contractual or statutory notice periods can continue to be placed on furlough whilst on notice and be eligible for claims.
We have updated our CJRS guidance about error corrections for furlough claims, including reducing the amount for subsequent claim or deleting an erroneous claim within 72 hours of making the claim. These corrections can be made online via the claims portal. Other errors such as revising a previous claim upwards if an underclaim was made or if revising a claim downwards if an overclaim was made and no further claims are to be submitted cannot be made online. In such cases employers will have to use the HMRC direct contact details which are provided in our guidance mentioned above.
HMRC has announced that it will be introducing legislation to recover overclaimed grant amounts through the tax system. If any overclaimed grant amounts are repaid through the above methods then this will reduce or, if the full amount is repaid, prevent any potential tax liability under that legislation. See our article on Targeting Covid-19 related fraud – new HMRC powersfor further details.
The additional legislation also provides for penalties (including revised penalty factsheet CC/FS48) for not notifying HMRC of any overclaims of grants that employers are no longer entitled to with deadlines by when notification must be made – our updated guidance has further details.
At the same time, HMRC has now provided a facility to make complaints about any mistakes or unreasonable delays caused by them. This is unlikely to include any complaints about the non-qualification of claims under the annual payroll scheme for directors. Whilst ACCA Policy continues to push for some leeway on getting support for this section of the small business community, we are also in support of the Forgotten Ltdcampaign group and any members who have been unsuccessful in making claims for their annual payroll director companies may wish to join this group for a better chance of success.
Job Retention Bonus – the government has announced the introduction of a one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously employed once the CJRS ends at the end of October. Employees who had been previously furloughed and are retained in their jobs must continue to be employed from 1 November 2020 to 31 January 2021. They must also earn above the Lower Earnings Limit (£520 per month) on average in those three months. The bonus payments are due to be made from February 2021. Further details about the scheme are due to be announced soon.
Self-Employment Income Support Scheme (SEISS)
Claims under the first tranche of the SEISS scheme closed on Monday 13 July. Eligible individuals were able to claim a first taxable grant worth 80% of their average monthly trading profits, paid in a single instalment covering three months’ worth of profits, and capped at £7,500. There will be no further updates to this tranche.
Eligible applicants whose businesses have been adversely affected by COVID-19 on or after 14 July will be able to claim a second and final taxable grant worth 70% of their average monthly trading profits, paid in another single instalment covering three months’ worth of profits, capped at £6,570. An individual does not need to have claimed the first grant to receive the second grant: for example, they may only have been adversely affected by coronavirus in this later phase.
This scheme will run from 17 August when claims will open in the online portal and run until 19 October 2020.
HMRC has announced that those individuals who may have overclaimed or should not have claimed due to not meeting the eligibility criteria should tell HMRC and repay any appropriate amounts to HMRC via the same online portal from which they made the claim. Further details of the repayment of the grant are available.
Whilst practitioners may not have been directly involved in making the SEISS claims for their clients, they should communicate details about the repayment portal as soon as possible to their self-employed clients.