Timely reminders

January 27, 2021

Self-employed grant claims
The third grant claim must be claimed by 29 January so if you qualify do not delay submitting your claim – see https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income-support-scheme

Please note that the criteria for claiming has changed slightly since the earlier grants, please read the notes carefully when you submit your claim, most people affected by the lockdown will not have difficulty justifying a claim but please note the following comment from HMRC and the need to keep evidence:

In order to claim, you must reasonably believe that you will suffer a significant reduction in trading profits due to reduced business activity, capacity, demand or inability to trade due to coronavirus during 1 November 2020 to 29 January 2021. You must keep evidence that shows how your business has been impacted by coronavirus resulting in less business activity than otherwise expected.

Details for the 4^th grant are expected to be announced on 3 March.

Tax payments
We are aware that some people may not have received their tax payment request from HMRC and do not have details of how to pay, details of how to pay can be found at : https://www.gov.uk/pay-self-assessment-tax-bill the reference to quote is your unique tax reference (UTR) a 10 digit code which is on your tax return and add a “K” on the end. If you are not sure which tax office to use, then use Cumbernauld.

Note interest is charged on all tax paid late. If 2019/20 tax is not paid by 28 February 2021 a late payment charge of 5% arises unless you agree a time to pay arrangement with HMRC (see below).

Are your payments on account too high?

If your profits for the current year are expected to be lower than the previous year, then you can apply to have payments on account for 2020-21 reduced. Do remember that any Self-employed grant claimed in the current will be included in taxable profits. We can help clients calculate a more realistic – and lower – figure and submit a request to reduce any tax due.

Struggling to pay all your tax?

HMRC will allow you to pay in instalments if you owe £30,000 or less and do not have any other current payment plans or debts with HMRC.

To do this you will need to contact the Payment Support Service (0300 200 3835) or set up a payment plan online. See https://www.gov.uk/pay-self-assessment-tax-bill/pay-in-instalments

Interest will be charged on any late paid tax but you will not be charged a late payment surcharge if you agree instalment arrangements by 28 February.

Tax returns deadline

You may have seen in the news that the penalty for filing returns late (after 31 January) is being waived this year providing returns are submitted by 28 February, whilst this is good news for those struggling to meet the deadline there are a few points to remember:

Interest will be charged on tax paid late;
Late filing will extend the period of time that HMRC has to enquire into your return;
You will not be eligible for paying by instalments under a time to pay arrangement if your tax returns are not up to date.

Self- assessment scams

There is currently a high level of activity from scammers pretending to be HMRC and either offering rebates or demanding tax payments by email or phone. Be wary of all unexpected contact from HMRC , they should never contact you by email re tax refunds or outstanding payments. If in doubt about any HMRC contact see HMRC scams checklist or clients should contact us. Suspicious emails can be forwarded to [email protected] .

For more information or to discuss any issues raised above please contact Simon Bell by phone on 01376 571358 or email [email protected] .
Please feel free to forward this newsletter to any colleagues or friends who may be interested in it.
This newsletter is written in general terms and therefore cannot be relied on to cover specific situations; applications of the principles set out will depend on the particular circumstances involved. It is recommended that you take professional advice before acting or refraining from acting on any material in the newsletter.