HMRC circulates latest guidance for businesses and employees in relation to the coronavirus outbreak

23 March 2020

On 20 March 2020, HMRC circulated further guidance for both employers and employees regarding the escalating situation in relation to the outbreak of coronavirus.

It would be highly beneficial for businesses and their staff to familiarise themselves with this information and to keep updated as the situation is evolving daily.

The Chancellor announced a range of temporary measures designed to assist the public services, individuals and companies through the inevitable period of disruption, caused by COVID-19.

The guidance is comprehensive, and for employers covers the topics of:

  • A Coronavirus Job Retention Scheme
  • Deferring VAT and Income Tax payments
  • A Statutory Sick Pay relief package for SMEs
  • A 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
  • Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
  • Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
  • The Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
  • A new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
  • The HMRC Time To Pay Scheme

Of particular note is the information relating to the Coronavirus Job Retention Scheme. This scheme will allow all UK employers to access support to allow them to continue paying part of their employees’ salary for any individuals that would have otherwise been laid off during this crisis. All UK businesses are eligible and will need to designate any affected employees as ‘furloughed workers’, notifying them of this change to their employment status. They will also need to submit information to HMRC in relation to employees that have been furloughed and provide details of their earnings through a new online portal. HMRC will then reimburse 80% of the costs of workers’ wages, up to a cap of £2,500 per month. HMRC is working urgently to set up a system for this reimbursement, as current systems do not facilitate payments to employers. For businesses in need of short term cash flow support, they may be eligible for a Coronavirus Business Interruption Loan.

There is further discussion of the government’s plans to reimburse up to two weeks’ worth of Statutory Sick Pay (SSP), per eligible employee absent due to COVID-19, for employers with less than 250 staff, as of 28 February 2020. Employers are advised to retain records of staff absences and SSP payments, but employees do not need to provide a GP fit note. If employers do require evidence, those with symptoms can obtain an isolation note from NHS 111 online, and those who live with someone displaying symptoms of COVID-19 can get a note from the NHS website. The government will be working over the coming months to set up the repayment mechanism as soon as possible.

There will also be support for businesses paying tax through HMRC’s Time To Pay service, so that any businesses or self-employed individuals in financial distress, with outstanding tax liabilities, may be eligible to receive support with their tax affairs. The arrangements are to be agreed on a case-by-case basis and will be tailored to individual circumstances and liabilities. For those who have missed a tax payment, or are worried they may miss their next payment due to COVID-19, there is a dedicated helpline that they should call – 0800 0159 559.

The guidance for employees covers the following subjects:

  • Staying at home
  • Sick pay
  • Furloughed workers
  • Claiming benefits

 


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