Many small businesses are running out of money, and it’s difficult to budget as no-one knows when the national lockdown will end or be eased. You need to take advantage of the business support schemes available to you.SEISS
The deadline for applying for the third SEISS grant is 29 January 2021. You need to apply for this grant online yourselves using your Government Gateway ID and password, we can’t apply on your behalf.
The Chancellor said a fourth SEISS grant would be made available to help businesses survive the three months to 30 April 2021, but there is still no detail of how much it will be or when traders will be able to apply. We also don’t know what the conditions for the fourth SEISS grant will be.
It’s possible that this grant will be partially based on the profit reported in the 2019/20 tax return. It may also be restricted to traders who submitted their 2019/20 tax return by 31 January 2021.CJRS
Many small company directors were locked out of the first two versions of CJRS because they normally pay themselves an annual salary at the end of March.
If those directors did not have pay reported under RTI in 2019/20 before 20 March 2020, they couldn’t claim under CJRS-1 or CJRS-2. If they managed to pay themselves some salary between 20 March 2020 and 30 October 2020 they are eligible for CJRS-3.
The problem is how to calculate the amount to claim under CJRS based on one annual payment of salary, taking into account the monthly pay cap of £2,500.
HMRC has finally issued some examples on annual salary payments (numbered 3.14 and 3.15), and they both take the annual salary and divide it by the number of days in the annual pay period (366 or 365 days). If you have restricted the claim according to the monthly cap of £2,500, you may want to revisit those calculations.
Unfortunately, the HMRC example 3.14 is incorrect as if the director was not paid in the period 20 March to 30 October 2020 (inclusive) they would not be eligible to claim under CJRS-3.
Finally, if you are submitting CJRS claims for employers with more than 100 employees, be sure to download the new spreadsheet templates provided by HMRC.Written by the Tax Advice Network