COVID-19 – Frequently Asked Questions

VAT

Do I need to pay VAT?

No, you are not required to pay VAT to HMRC during the ‘deferral period’.  The government will allow businesses to defer paying VAT for 3 months.  The deferral period runs between 20 March 2020 and 30 June 2020.  Please make sure that you cancel any direct debit instruction in favour of HMRC if you wish to take advantage of the deferral period.

Am I still required to submit VAT returns to HMRC?

Yes, you are still required to prepare and submit VAT returns to HMRC during this period.

When will the deferred VAT be payable?

You will be given until 31 March 2021 to pay any liabilities accrued during the deferral period.

Corporation Tax

Do I need to pay corporation tax?

There is no deferral scheme in place for corporation tax.  However, HMRC are agreeing to defer payments or set up payments by instalment on a case by case basis.

HMRC’s contact number is 0800 015 9559.  You will need a note of your corporation tax reference number when you call.

Am I still required to submit corporation tax returns to HMRC?

Yes, as for VAT you are still required to prepare and submit corporation tax returns to HMRC during this period.

Job retention scheme and PAYE

Do I need to pay PAYE?

There is no deferral scheme in place for PAYE.  However, HMRC are agreeing to defer payments or set up instalments on a case by case basis.

HMRC’s contact number is 0800 015 9559.  You will need your PAYE reference and Accounts office reference to hand when you call.

What is the job retention scheme?

The job retention scheme has been set up so that employers can access funds to pay part of their employees’ salary during the crisis rather than lay them off.  The government will reimburse 80% of the ‘furloughed workers’ gross wages. All UK business and charities are eligible for the scheme.

Please note, HMRC have still to provide full details as to who is covered and how they calculate the gross pay.  Details will be released in due course.  As an employer you must notify employees of this change in status and you should seek HR advice before making any final decisions.

What is a furloughed worker?

A furloughed worker is an employee who would have been laid off during the crisis but instead is kept on the payroll and given a leave of absence.

How do I claim the 80% of salary costs from the government?

HMRC are currently working on a portal which will allow businesses to submit claims.  In the meantime you will be required to continue to pay staff.  Therefore it is vital to consider cash flow.

I’m a director – how will this affect me?

There are no details on any relief/funding available to directors at this time.  But please keep checking our website for updates:

https://jsca.co.uk/category/coronavirus/

I’m self-employed – how will this affect me?

Unfortunately, there are no details on any relief/funding available to the self-employed at the moment. However, HMRC have announced a deferral period for personal tax payments for the self-employed.  Payments due on 31 July 2020 will be deferred until 31 January 2021.

There will no doubt be further announcements over the coming weeks with the finer points being confirmed by the government in due course.

Please keep checking our website to stay up to date with developments:-

https://jsca.co.uk/category/coronavirus/

 

Photo by Martin Sanchez on Unsplash

The information in this blog provides only an overview of HMRC guidance and legislation in force at the date of publication and no action should be taken without consulting the detailed HMRC guidance and legislation or seeking professional advice.  Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this blog can be accepted by the firm.