Hope you’re all well and had a good weekend despite lockdown 3.0 feeling a bit never-ending at the minute!
For today’s accounting related post, I thought I would do a round up of the latest in HMRC updates. Please note that these were all correct at the time this post was published. Don’t forget this post is for information purposes only and to consult with your own accountant for tailored advice to your situation.
NO LATE FILING PENALTY – If you submit your tax return by 28th February 2021 and pay your tax OR set up a time to pay arrangement with HMRC by midnight on 1st April 2021, you will not be charged a late filing penalty of 5% of the taxed owed or £100 automatic late submission penalty. The press release can be found here. Please be aware that there have been NO announcements that interest is being waived so you will still incur interest on any payments made after 31st January 2021. To set up a time to pay arrangement, further details are found here.
VAT DEFERRAL SCHEME – If you deferred your VAT payment on any VAT return due between 20th March – 30th June 2020, you had to pay this by 31st March 2021. HMRC have now announced that you can now pay in instalments under the VAT deferral new payment scheme. Unfortunately, your accountant isn’t able to set this up for you on your behalf as you need to apply via your Government Gateway account (or by calling HMRC on 0800 024 1222 if you have difficulties with your online account) and the number of instalments you can pay under depends when you apply for the scheme. You can apply between 23rd February and 21st June 2021 and each month that goes by reduces the number of instalments by one month. For example, if you apply by 19th March 2021, there will be a maximum of 11 instalments available to you but if you apply by 21st June 2021, this reduces to a maximum of 8 monthly instalments. You must be up to date with your VAT returns, the first instalment must be paid on the date you join the payment deferral scheme and instalment payments can only be made by direct debit. For further information, please click here.
DELAY YOUR FIRST BOUNCE BACK LOAN PAYMENT – For those who have applied for a bounce back loan were expected to make their first repayment under this loan scheme in 12 months but the Chancellor has announced that you can apply to delay your first repayment by a further 6 months. It was also announced that the term of the bounce back loan can be extended from 6 to 10 years and the ability to make interest only payments for 6 months (this option can be used up to 3 times during the loan term). Your bounce back loan lender should contact you before the first 12 month period ends to discuss your options with you. For further details on the announcement, click here.
OTHER NEWS – If you are struggling and want to find what support is available to you, check out HMRC’s handy tool here. This will ask a series of questions about your business and will let you know what schemes and grants are available to you. Also, Rishi Sunak has announced he will be releasing details of the next Self Employment Income Support Scheme (SEISS) grant payment when he delivers the budget on 3rd March 2021.
Fingers crossed that there will be an update in the SEISS scheme for those who just missed out by starting their business in the 2019/20 tax year. I know it’s not a given but I think it’s possibly a good sign that the SEISS 4th grant has been delayed until after the extended deadline for self assessment tax returns and that 2019/20 tax returns will be taken into account this time round. I know this doesn’t help the thousands who are also struggling under the #forgottenltd campaign.
Until my next post..