Coronavirus update 9 – 27 May 2020
SSP claims and updates on SEISS and CJRS
This newsletter is a brief update on previously announced support schemes, and extensions to the Coronavirus Job Retention Scheme (CJRS).
STATUTORY SICK PAY (SSP) CLAIMS
As you may recall, one of the first initiatives announced by the government was the offer to fully fund SSP for two weeks, where employees were off sick due to Coronavirus, and the employer had fewer than 250 employees. At long last, the government has now confirmed that claims can be made and the online claim facility is now available from https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19
As a reminder about the scheme, please refer to the link above, but we are not expecting many claims. Additionally, the amounts involved are fairly small – a maximum of £188.50 for claims relating back to before 5 April, and £191.70 for those that arose in the current tax year. Bear in mind that you can only reclaim the SSP element of pay – if you continued to pay the employee in full, then the balance is not covered by this scheme. But it did take affect earlier than other initiatives – it started on 13 March.
Where we maintain your payroll records, we will automatically make the claim on your behalf, and use the bank details which you have already provided for CJRS claims, unless you advise us to the contrary.
If you maintain your own payroll records, you will need to make the claim yourself, using your Government Gateway account.
SELF-EMPLOYED INCOME SUPPORT SCHEME (SEISS) – UPDATE
The new on-line claim service seems to be working remarkably well. We were told that claims would not be paid until 25 May, but we know that some claims were paid earlier. Please refer to Newsletter 8 for fuller details of how to claim, but here are a few “frequently asked questions”:
Can we make the claim for you?
No - regrettably, we will not be able to make claims for you. However, we are more than happy to check whether you are eligible, and if so, how much you ought to receive. We can also appeal claims where we think you have not received the correct amount.
What happens if I do not have a Government Gateway account?
You can create one during the claim process. You will need some form of government issued ID to do so – e.g. a current passport or a photo-ID driving licence.
What happens if I do have a Government Gateway account, but cannot remember my login and password details?
Unfortunately, you will probably have to phone HMRC to sort it out. If you have forgotten any of the details, go to: https://www.gov.uk/log-in-register-hmrc-online-services/problems-signing-in
Do I have to pay tax on the grant?
Probably – it will count as part of your self-employed profits for the current year, and it is taxable; but if your profits (including the grant) are covered by your personal allowance, then you may not actually pay any tax on it.
If I have been trading for less than three years, how do HMRC calculate the average profits?
Unfortunately, HMRC just divide your total profits by the number of years in which you have traded, and not by the number of days or months. It would seem that their guidance was changed at some point, and this treatment unfairly penalises those who may only have started trading late in a tax year. As there is no legislation covering the calculations, we must reluctantly accept HMRC practice.
Is the scheme being extended beyond the first three months?
We do not know, and nothing has been announced yet, but we fear that this is going to be a one-off grant.
EXTENDED SUPPORT FOR EMPLOYERS - CJRS
Unlike the SEISS scheme, the CJRS has been extended. In its current format, it is due to continue until 31 July, and then it has been extended in a reduced format to 31 October. Exact details of what will happen after 31 July are awaited, but employers will have to start contributing to the cost of employing furloughed workers from 1 August onwards. Employees will still be entitled to at least 80% of their normal pay, but employers will be able to start asking furloughed employees to work part time under the new rules.
The claim process seems to be working well, and we are now making claims at the same time as calculating wages for our payroll clients. We have also noticed a number of clients starting to take employees off furlough, and do please let Nikki know when this happens in advance of your normal payroll run date.
If you have any questions, please do email your regular contact or at email@example.com.