Take your time, hurry up

By Mel Hackney

This year could be more important than ever to know what liabilities you may face in January, with many businesses and individuals facing cash flow issues due to Covid.

HMRC announced in March 2020 that they would waive interest on the taxpayer delaying their second payment on account towards 2020/21 tax year from the usual due date on 31 July 2020 to 31 January 2021.

However, this delay means that taxpayers may need to make a significant payment to HMRC by 31 January 2021, which means finding out the final 2019/20 liability through the prompt completion of self-assessment is key this year.  

If the taxpayer is unable to make the full payment due on 31 January 2021, they should consider a time to pay arrangement with HMRC.

In September 2020 it was announced that, if the taxpayer is unable to make the full payment due on 31 January 2021, they can consider a time to pay arrangement. This is applied for through one of two ways, depending on the level of outstanding liability.

Self-assessment taxpayers who have a payment to make in January of up to £30,000 can use a self-service facility in order to agree a plan with HMRC to spread their payment over 12 months, where as those with liabilities of more than £30,000 can also access time to pay to spread their payments, but they must contact the time to pay helpline to do so.

If you have not completed your personal tax return yet, get in touch and we can help.

The Job Retention Scheme is ending – now what?

By Emma Hooper

The Job Retention Scheme (JRS) is coming to an end on 31 October and will be replaced with a new wage subsidy scheme called the Job Support Scheme (JSS). The JSS will begin on 1 November 2020 and will run for 6 months, aiming to support employees and businesses by topping up salaries where returning to work full-time is still not viable.

The JSS is completely independent of the JRS, meaning neither the employee nor employer needs to have previously used the JRS to be able to make a claim through the JSS.

Who is eligible?

All small and medium sized businesses are eligible, as well as larger businesses who can prove revenue has been negatively impacted by COVID-19.

Employees must be able to work at least one-third of their normal hours to be eligible.

What financial support is available?

For the unworked hours, the government and employer will each be responsible for paying one-third of the employee’s remaining wages. This means the employee will receive at least 77% of their normal pay.

The contribution payable by the JSS will have a monthly cap of £697.92.

Employer’s NIC and pension payments will not be covered by the JSS and will be payable by the employer.

An example

If an employee who usually earns £1,000 a month has only worked 50% of their normal hours, their normal pay will be reduced to £500. The government will then pay one-third of the unworked hours, being £166.67, and the employer will pay the same. The total amount the employee will therefore receive will be £833.34.

If you have any questions about the JSS or would like us to process claims on your behalf, please let us know, as this is a service we provide.