News

We aim to periodically share with you updates which you will hopefully find useful.

New VAT Penalty Regime

Changes are coming to the way in which VAT is administered by HMRC. A new points based penalty regime is around the corner. See below a summary of the changes, but rest assured we are here, as ever, to help make sure you remain compliant:

You will be penalised if the VAT return is late and/or the payment is late, regardless if the VAT is a refund or is nil.

Late Submission of return

When a submission deadline is missed, a point will be incurred.
Once a penalty threshold has been reached a fixed penalty amount of £200 will be issued for every missed submission.
The threshold will vary according to the filing frequency (Quarterly - 4 points, Monthly - 5 points)
As long as the penalty threshold is not breached, points will expire after 24 months.
After a business has breached the penalty threshold, all points accrued will only be reset to zero once they have met these two conditions:
- A period of compliance is complete, based on their submission frequency
- All submissions that were due within the preceding 24 months have now been submitted

Late payment of return

Late payment could potentially mean you receive two penalties depending on when you pay.
The first penalty will be levied 31 days after the payment due date and will be based on a set percentage of the balance outstanding.
The second penalty will be calculated on amounts outstanding from day 31 until the principal balance is paid in full.

Arranging a payment plan (Time to Pay) with HMRC will result in the penalty charge being suspended. – So if you can’t pay straight away, call to arrange a plan!

HMRC will notify the customer of both penalties separately:

	Days after payment due date	Penalty charge
First Penalty	0 to 15	No Penalty payable
	16 to 29	Penalty calculated at 2% of what was outstanding at day 15
	30	Penalty calculated at 2% of what was outstanding at day 15 Plus 2% of what is still outstanding at day 30
Second Penalty	Day 31 plus	Penalty calculated as a daily rate of 4% on APR for the duration of outstanding balance.

Coronavirus / Covid-19

There is lots of guidance being made available for businesses and employers in the wake of the Coronavirus / COVID-19 outbreak in the UK. You may find selected pages below helpful:

For everyone:

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses

The above link contains information on:

Coronavirus Job Retention Scheme (The "80% of wages" payments). More guidance here:

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

Deferring VAT and Income Tax payments

Statutory Sick Pay (SSP)

Business Rates Relief

Small Business Grants. You will probably need to contact your council if you do not pay any business rates as they won't have your bank details. Most councils require you to fill in an online form. We recommend you check your local authority website. More guidance here:

https://www.gov.uk/government/publications/coronavirus-covid-19-guidance-on-business-support-grant-funding

Coronavirus Business Interruption Loan Scheme

HMRC 'Time to Pay' arrangements

Further specific guidance for employers:

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/guidance-for-employers-and-businesses-on-covid-19

Further specific guidance for employees:

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-guidance-for-employees

There is a dedicated Coronavirus / COVID-19 HMRC Helpline you can call if you have any issues keeping up with tax liabilities or other financial difficulties as a result of the current situation:

0800 0159 559