Latest Updates from HMRC

VAT deferral new payment scheme – join from 23 February

If businesses in Brentwood and Ongar deferred paying VAT due in the period from 20 March to 30 June 2020 and can’t afford to pay by 31 March 2021, they can join the VAT deferral new payment scheme and pay their deferred VAT over a longer period.

The online service will open on 23 February 2021 and close on 21 June 2021. Businesses in Brentwood and Ongar can make up to 11 monthly instalments, interest free. The earlier they join, the more months they can spread their payments across.

Businesses can join the scheme online without the need to call on GOV.UK when it opens. Please note that HMRC is unable to provide an agent service for this scheme.

Businesses that need more time to pay their deferred VAT should contact HMRC.

Supporting organisations to comply with changes to the off-payroll working rules (IR35) 

As part of HMRC's work to implement the changes to the off-payroll working rules (‘IR35’) on 6 April 2021 they have published a briefing outlining how HMRC will work with affected organisations to ensure they comply with their responsibilities under the rules. 

From 6 April 2021, organisations engaging contractors who work through a personal service company (or ‘PSC’) or other intermediary will be responsible for determining if they are employed or self-employed for tax purposes. 

HMRC's role is to help people to pay the right tax through education and well-designed systems, and to step in when tax is at risk of not being paid. The briefing explains how HMRC will support customers to comply with the off-payroll working rules, as well as how HMRC will intervene where customers deliberately don’t comply. It also:   

• Provides an overview, and operational case studies, setting out what customers can expect from them as HMRC work with them to get their tax right, including that HMRC will provide targeted advice, continue working with trade and representative bodies and encourage customers to self-correct mistakes.
• Reaffirms HMRC’s commitments to a supportive approach to help organisations comply with the new rules – including that HMRC will apply a ‘light touch approach to penalties in year 1 and that HMRC won’t use information acquired as a result of the changes to the off-payroll working rules to open a new compliance enquiry into returns for tax years before 2021 to 2022, unless there is reason to suspect fraud or criminal behaviour. 
• Confirms that the scope of our compliance activity is not solely related to the application of the off-payroll working rules, but includes all arrangements that result in less tax being paid than should be the case such as tax avoidance schemes that claim to avoid the rules.
• Explains HMRC will use a specialist team for off-payroll working compliance activity ensure customers receive high-quality support and non-compliance is challenged effectively and efficiently.

You might be interested in this publication if you need to apply the off-payroll working rules:  

• medium and large-sized private sector organisations which engage contractors who work through their own limited company or other intermediary.
• public sector authorities which engage contractors who work through their own limited company or other intermediary (the rules changed in 2017 for this sector).
• employment agencies and third parties which supply contractors.

This briefing focuses on the compliance of medium and large organisations because under the new rules, contractors will not be liable for tax due on their engagement with these clients. This means if their client organisation (a public authority or medium or large-sized non-public sector organisation) makes the wrong decision, after April 2021 contractors will not be liable for the unpaid Income Tax or NICs. 

Trade and representative bodies provided input into the development of the briefing. HMRC hope organisations and their advisers use the off-payroll working compliance briefing, along with the detailed guidance and other resources we’ve provided, to support their preparations to comply with the rules from 6 April and to understand how HMRC will work with them to comply with the off-payroll working rules in the future. 

Coronavirus Job Retention Scheme

HMRC would like to remind employers in Brentwood and Ongar of an upcoming deadline for Coronavirus Job Retention Scheme (CJRS) claims, and to answer some questions they may have.

Also included is information on checking claims employers have made for variable paid employees – those not on fixed salaries – and more on HMRC publishing details of their CJRS claims from this month.

Checking their claims for variable pay if they’ve used the HMRC calculator

HMRC are afraid that their CJRS calculator on GOV.UK contained a software error, which they have now corrected. If an employer in Brentwood and Ongar used it before 21 January to work out January claims for employees that are not on a fixed salary you’ll need to re-calculate the claims if:

• you used an employee’s pay for January 2019 as reference pay, instead of 2020, and
• their pay was different in January 2019 to January 2020.

If an employer in Brentwood and Ongar used their employee’s January 2020 pay they do not need to take any action.

If after they have made their re-calculation they find out their claim was incorrect and:

• the employer has claimed too much, they should amend this in their next claim or let us know as soon as possible and make a repayment online, through our card payment service or by bank transfer on GOV.UK.
• they claimed too little, please call the helpline to amend this by 1 March. 

Go to Get help with the Coronavirus Job Retention Scheme for more information on how to amend a claim.

February Claims - submit now

Employers in Brentwood and Ongar can now submit their claims for periods in February. These must be made by Monday‌‌ ‌15 March.

Employers can claim before, during or after their payroll is processed. If they can, it’s best to make a claim once they’re sure of the exact number of hours their employees will work so they don’t have to amend the claim later.

Employers in Brentwood and Ongar can check if they and their employees are eligible and work out how much they can claim using our CJRS calculator and examples‌.

What employers in your constituency need to do now:

1. If they haven’t submitted their claim for January but believe that they have a reasonable excuse for missing the deadline, check if they can make a late claim on GOV.UK.
2. Submit any claims for February no later than Monday 15 March.
3. Keep records that support the amount of CJRS grants claimed, in case HMRC needs to check them. ‌

January claims – submit now

If an employer in Brentwood and Ongar hasn’t submitted their claims for January, they must do so by the deadline of Monday 15 February.

As a reminder, the UK Government will pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month. Employers and their employees do not need to have benefited from the scheme before to make a claim, if employers and employees meet the eligibility criteria.

If an employer in Brentwood and Ongar didn’t make their January CJRS claims by the deadline of 15 February, HMRC may still accept it if there is a reasonable excuse for not claiming on time, such as self-isolating (and no-one else could make the claim for you) or an unexpected stay in hospital that prevented completing a claim.

If the reason means you can apply to claim late, you should do so as soon as you’re able to. More information on reasonable excuses is available on GOV.UK.

What employers in Brentwood and Ongar need to do now

1. Check if you’re eligible and work out how much you can claim using HMRC's CJRS calculator and examples.
2. Submit any claims for January no later than Monday 15 February.
3. Keep records that support the amount of CJRS grant claimed, in case HMRC needs to check them. ‌

Frequently asked questions about the CJRS

You can find everything you need to know about the CJRS on GOV.UK, but here are some answers to the questions employers have been asking HRMC recently.

• How do employers in Brentwood and Ongar ask HMRC not to publish their claim details? If publishing an employer’s claim details could leave someone at risk of violence or intimidation, they can request for these not to be published by completing the online application form. HMRC will not publish an employer’s details until they have informed them of their decision on their application. Employers only need to apply once, as the decision will cover all CJRS claim periods starting from 1 December 2020. Applications must be made by an employer and they can’t be made by an agent on their behalf.
• Can employers in Brentwood and Ongar claim for employees who are training? Employers can claim for employees who undertake training while they are furloughed, as long as they don’t provide services to, or generate revenue for, their business or a linked or associated organisation. More information is available on GOV.UK.
• Can employers furlough an employee if they are unable to work because they have caring responsibilities or are classed as clinically extremely vulnerable? If an employee in Brentwood and Ongar asks to be furloughed, employers can claim for them under the CJRS if; they have caring responsibilities resulting from coronavirus, such as caring for children who are at home as a result of school or childcare closing, or they are clinically extremely vulnerable, or in the highest risk group for severe illness from coronavirus according to the public health guidance for their area.

• What happens if an employer pays back their grants? If an employer chooses to pay back the money they have received, their details will be removed from the list of claims when it is next published (usually in the following month).

• Can an employee work elsewhere if they’re furloughed? If an employee has more than one employer, they can be furloughed for each job. Employees can be furloughed in one job (and receive that furloughed payment) but continue working for another employer and receive their normal wages. In employee can also take part in volunteer work during hours when they are furloughed, as long as it’s for another employer or organisation which is not connected with their own employer.

Go to check which employees you can put on furlough to use the Coronavirus Job Retention Scheme for other circumstances where an employer can furlough an employee.

The decision to offer furlough rests with the employer.