Welcome to our round up of the latest business and Covid-19 news. Please contact us if you want to talk about how these updates affect your business. We are here to support you through these tough times.
Pay VAT deferred due to COVID-19
If you deferred VAT payments due between 20 March and 30 June 2020, and still have payments to make, you can:
pay the deferred VAT in full, on or before 31 March 2021.
join the VAT deferral new payment scheme – the online service is open between 23 February and 21 June 2021.
contact HMRC on Telephone: 0800 024 1222 by 30 June if you need extra help to pay.
You may be charged interest or a penalty if you do not:
pay the deferred VAT in full by 31 March 2021.
opt into the new payment scheme by 21 June 2021.
agree extra help to pay with HMRC by 30 June 2021.
The scheme is now open for online opt in via www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19
The scheme will allow you to:
pay your deferred VAT in instalments without adding interest.
select the number of instalments from 2 to 11 equal monthly payments.
To use this scheme you must:
still have deferred VAT to pay.
be up to date with your VAT returns.
opt in before the end of March 2021.
pay the first instalment when you opt in
If you opt into the scheme, you can still have a time to pay arrangement for other HMRC debts and outstanding tax.
Self- Assessment payments – Pay in Instalments
You can pay your tax by instalments if you were unable to pay in full by 31 January 2021. If you have not filed your 2019 to 2020 Self-Assessment return, you will need to file it as soon as possible. HMRC will then know what payments you owe, and you will be able to set up a Time to Pay instalment arrangement with them.
If you owe up to £30,000 you can do this online without having to contact HMRC directly.
When you have filed your return you will need to wait at least 72 hours before you can set up your Time to Pay arrangement online.
Late payment penalties are charged when tax remains unpaid for 30 days, 6 months and 12 months after the payment due dates. You can avoid the penalties if you enter into a Time to Pay arrangement before they become due and you pay all the tax owing under that arrangement on time.
For Self-Assessment payments that were due on 31 January 2021, you will avoid the first late payment penalty if you set up a Time to Pay arrangement by 2 March 2021. The 6 month and 12 month penalties can be avoided if you pay all the tax owing under that arrangement on time
Interest is payable on Time to Pay instalments so you should check the interest rates for late and early payments.
If you are unable to pay your self-assessment tax please talk to us about your options and we will endeavour to assist with informing and talking to HMRC.
Self-Employment Income Support Scheme (SEISS)
Claims for the third SEISS grant have now closed. The last date for making a claim for the third grant was 29 January 2021.
Details about the fourth grant will be announced on 3 March 2021. We will keep you up to date on any new developments.
Bounce back loan borrowers can delay repayments by extra six months
Businesses that took out government-backed Bounce Back Loans to get through Covid-19 will now have greater flexibility to repay their loans.
Bounce Back Loan borrowers will now have the option to tailor payments according to their individual circumstances with the option to delay all repayments for a further six months. Pay as You Grow will be available to over 1.4 million businesses, which collectively took out nearly £45 billion through the Bounce Back Loan Scheme.
Small firms in line for business interruption insurance pay out
The Financial Conduct Authority (FCA) has won its court case to get insurers to pay out for business interruption due to the first lockdown in the spring of 2020. The Supreme Court says it “substantially allows” the appeal by the FCA and hospitality groups. The decision affects approximately 370,000 policyholders and over £1billion in claims which should now be paid out.
Small businesses including pubs, cafes, wedding planners and beauty parlours, argued they faced becoming insolvent when they were refused compensation by insurers for business interruption policy claims on losses caused by the first national COVID-19 lockdown.
Some of the world's largest commercial insurers including Hiscox, Royal Sun Alliance, QBE, Argenta, Arch and MS Amlin, told the Supreme Court in an appeal that many business interruption policies did not cover widespread disruption. The Court ruled against them.
This now means that the Supreme Court ruling will provide guidance on the claim adjustment process and it is hoped that this will progress quickly.