We round up the latest news from HMRC - here we look at the fourth SEISS grant, if a CJRS grant can be used to pay for holiday leave and the VAT deferral new payment scheme…

Fourth SEISS grant eligibility

  • To be eligible for the fourth SEISS grant, HMRC has said self-employed individuals (including members of partnerships) must:
  • Have submitted their 2019-20 tax return on or before 2 March 2021.
  • Have trading profits that are no more than £50,000 and at least equal to their non-trading income, based on their 2019-20 tax return or an average of relevant tax years between 2016-17 and 2019-20.
  • Declare that they intend to continue to trade and are either:
  • currently trading but are impacted by reduced activity, capacity or demand due to coronavirus, or
  • have traded previously but are temporarily unable to do so due to coronavirus (If they’ve been abroad and have to stay in quarantine or self-isolate, this does not count).
  • Declare that they have a reasonable belief that there will be a significant reduction in their trading profits due to reduced business activity, capacity, demand or inability to trade due to coronavirus.

Getting ready to claim SEISS grants

HMRC stressed that ‘customers’ will be able to claim at any time from their claim date in late April until 1 June. 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, newly self-employed customers), they should create one now to avoid delaying their claim.

To confirm their eligibility and make their claim, customers will need their:

1. National Insurance number: If the customer doesn’t know this, they can go to the HMRC app or access their online Personal Tax Account (PTA).

2. Self-Assessment Unique Taxpayer Reference (UTR) number: Customers can find this on their Self-Assessment papers or their PTA.

3. Government Gateway user ID and password: To avoid delays, customers should ensure they check that they can log in to the Government Gateway before their personal claim date. If the customer doesn’t have an account or has forgotten their details, they can follow the instructions on GOV.UK. Customers should also check that their contact details are correct in their Government Gateway account.

4. Bank account number and sort code: For a building society account, customers should include the roll number, if they have one.

We will also ask for the address that the customer’s bank or building society account is registered to. Please note this is the customer’s address – most likely their home or business premises – not the address of their bank or building society.

As with previous SEISS grants, agents cannot claim on behalf of their clients, or use their log in details, as this will trigger a fraud alert and result in significant delays to the customer receiving payment.

If you haven’t claimed before

If it is the first time for claiming a SEISS grant, customers 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.

HMRC said those making a claim should ensure they have this information ready. Their claim may be delayed if they cannot answer the identity verification questions.

All claimants are also required to keep appropriate records as evidence of the impact on their business.

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 all time taken as a holiday as furloughed hours, rather than working hours. This means employers can currently claim 80% of their employee’s 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. More information is available on GOV.UK.

VAT deferral new payment scheme – businesses can apply now to spread their payments 

Businesses that deferred VAT payments due between 20 March and 30 June 2020 and have been unable to pay in full by 31 March 2021, can join the VAT deferral new payment scheme.

Businesses can apply now to spread these payments over several months.

Businesses that join by 21 April 2021 will be able to benefit from up to 10 instalments. The later businesses join, the fewer instalments are available to them.

Businesses can join the scheme quickly and simply online without needing to call HMRC. More information, including the things businesses need to prepare before joining online, is available on GOV.UK.

Businesses need to apply by 21 June 2021 if they want to join the scheme online.