Covid-19 – recent UK developments to end May 2020

Mon 01 Jun 2020

The notes below give an indication of the recent developments on covid-19 support in the UK.  For further details about these and any other covid-19 developments, please get in touch with your usual Mazars contact.  There is a range of information and links relating to Covid-19 available on the Mazars UK website here. 

• Details are now available of the Government’s Future Fund, aimed at providing financial assistance to innovative businesses to get them through the Coronavirus pandemic.  There are a number of conditions to be met, and the funding cannot be used to pay advisor fees.
• HMRC has launched its online statutory sick pay (SSP) rebate scheme from 26 May 2020.  This may be relevant for employer clients who are eligible for the scheme (those with fewer than 250 employees amongst other requirements).  The note is copied below for information.
• The Government has announced that the maximum loan size available under the Coronavirus large business interruption loan scheme (CLBILS) will be increased from £50 million to £200 million. 
• SI 2020/522 (coming into force 21 May 2020) ensures self-employed claimants cannot receive duplicate payments for living costs from both SEISS and UC.  The Regulations also make sure that payments from the Coronavirus Job Retention Scheme (CJRS) are not taken into account as earnings for a self-employed claimant, where the CJRS amounts for employees are to be passed on to the employees.
• We are aware HMRC is stepping up activity for dealing with non-compliance in respect of CJRS claims.  Separately, HMRC has recently published draft legislation concerning the tax treatment of Covid-19 grants.  These grants are regarded as income for income tax or corporation tax purposes.  There are some strict notification obligations to be aware of should there be an obligation to repay any incorrect claims.
• The Government has announced details of how the coronavirus job retention scheme (CJRS) and self-employed income support scheme (SEISS) will be extended.  Some important points to note include that:
  • applications for new claimants for CJRS will close on 30 June 2020, although there is a 10 June deadline for furloughing employees in order to be entitled to subsequent CJRS payments after 30 June, and;
  • applications for the first grant under SEISS close on 13 July 2020 (a second grant will be available from August).  
• Following a Government  announcement that it would donate certain input VAT recovered on donated goods, there may be an obligation to repay an input VAT already reclaimed on donated personal protective equipment (PPE) goods.  This may apply where the goods were bought at the standard rate of VAT between 1 March and 30 April 2020.
• In May HMRC announced an extension to the period for notifying a VAT option to tax from 30 to 90 days, for decisions made before 31 May 2020 – to decisions made on or before 30 June 2020.  In June, this relaxation was further extended to decisions made on or before 31 October 2020.
• The Scottish Government is and has been introducing its own measures to deal with the Covid-19 pandemic.  Two areas that may be of interest for tax concern:
  • the Scottish additional dwelling supplement (extending the period for reclaiming this from 18m to 36m) and;
  • a prohibition of Covid-19 grants for businesses associated with certain tax havens.  The Bill became an Act on 26 May 2020 (the date of Royal Assent).