Coronavirus Grants and VAT Deferral Scheme Penalties
In this newsletter:
• Restart Grant and Additional Restrictions Grant
• SEISS: fourth grant claims gateway now open
• VAT deferral scheme – penalty deadlines looming
Restart Grant and Additional Restrictions Grant
The Restart Grant is available to small businesses that were forced to close due to lockdown rules that fall into one of the following 2 categories:
Strand 1 Non-essential Retail
Non-essential shops can claim up to £6,000 each. Why only £6,000? Non-essential retailers like bookshops and boutiques can reopen from 12 April 2021 at the earliest, which is a few weeks before we can do things like dining indoors again.
Strand 2 Hospitality, Leisure and Personal Care
If you’re in one of the following sectors, you could be eligible for up to £18,000:
• Leisure (including gyms)
• Personal care and salons (e.g. hairdressers)
• Hospitality (e.g. pubs and restaurants)
You need to be the ratepayer to apply and what you can claim depends on your company’s ‘rateable value’;
• If your rateable value is £15,000 or less, you can claim up to £8,000.
• Businesses with a rateable value of between £15,000 and £51,000 can claim up to £12,000.
• If your business has a rateable value of over £51,000, you can claim up to £18,000.
So, if you’re a restaurant owner with a rateable value of £17,000, you could get up to £12,000 under the scheme. The deadline for applying for the Restart Grant is 30 June 2021
Additional Restrictions Grant
If you are not eligible for the Restart Grant eg because you are not the ratepayer you may be able to claim the Additional Restrictions Grant
Applications for the above grants should be made through your local council:
Worthing and Adur: Business Support – Adur & Worthing Councils (adur-worthing.gov.uk)
Waverley: Waverley Borough Council – – Coronavirus business grants
SEISS: fourth grant claims gateway now open
The online gateway to apply for the latest round of grants is now open.
You should already have been contacted if you are eligible for the grant, as HMRC is basing the information on the 2019/20 and 2020/21 tax returns. The letter will detail the earliest date you can make the application via the online gateway. You can apply directly here. We cannot do this on your behalf, as this may trigger a fraud warning.
If you’ve not received a letter from HMRC detailing your claim date, but you believe you’re eligible, contact HMRC on 0800 024 1222. The deadline for claims is 1 June 2021.
The fourth Self-Employment Income Support Scheme (SEISS) grant covers the months of February, March, and April 2021, and can be claimed if coronavirus has caused a significant reduction in trading profits for that period. To claim, a business must confirm that it has a reasonable belief that the profits for the period will be significantly affected. HMRC gives the following contrasting examples of when this will be the case:
Eligible. A cafe owner has fewer customers due to government restrictions and is only allowed to offer takeaway service, which reduces her takings. She reasonably believes this will significantly reduce her trading profits. She is eligible to claim the fourth grant.
Not eligible. A cafe owner has fewer customers due to government restrictions on households mixing, which initially reduces her takings. She increases her prices and believes her trading profits will not reduce significantly, so she is not eligible to claim the fourth grant.
HMRC issues reminder about VAT penalty
HMRC has warned businesses that took advantage of the coronavirus VAT deferral scheme last year that a key penalty deadline is looming.
At the start of the first lockdown, HMRC announced that VAT payments due between 20 March 2020 and 30 June 2020 could be deferred. The amounts deferred needed to be paid back by 31 March 2021. HMRC has now issued a reminder that if the deferred amounts are not made good by the end of June, a 5% penalty will apply as well as interest. Any business that has not already made good the amounts should make sure they do so by that date.
Alternatively, businesses that are struggling to pay the amount in one instalment can still opt into the new payment scheme here until 21 July 2021, and spread the repayment over the period to 31 March 2022. The number of instalments available will depend when the scheme is joined:
- before 19 May 2021 – nine instalments
- before 21 June 2021 – eight instalments.