12 Oct HMRC AMNESTY – Coronavirus Job Retentions Scheme & Compliance Checks

COVID19 UPDATE 12 OCTOBER 2020

Here at Rajani & Co., we continue with business as usual as we now enter the final hurdle before the end of the Year! I like to call this “Tax Season”.

HMRC Amnesty – Coronavirus Job Retentions Scheme & Compliance Checks

We are coming to the end of the original Coronavirus Job Retention Scheme (CJRS) on 31 October 2020. The end of this month will be the last month for claims under this scheme. However, it may not be the end of the story, as we have seen a number of compliance check letters sent to clients.

The first letter is a general letter in which you are requested to check your CJRS calculations for yourself and submit any adjustments or confirm that there are none. We advise that you do not ignore this letter but take the action required. If you do ignore the letter, it is likely that the next letter from HMRC is a compliance check letter, requiring the supply of detailed information under strict deadlines, for the HMRC to check your records themselves. If you have received either of these letters and would like some assistance please do not hesitate to contact us. There will be a fee for this service but it is possible that you may be able to claim under your tax investigation insurance service. If you have taken this up and would like to do so then please do contact us.

As you know there is a new scheme in place from 1 November 2020 called the Job Support Scheme (JSS). Once we have the final announcements regarding this scheme, we will send out further details.

3 Month Filing Extension of Company Accounts & Corporation Tax

You will be interested in an anomaly between filing of Limited Company Accounts to Companies House and the payment of corporation tax.

You may be aware that Companies House extended filing dates for Limited Company accounts to be filed 12 months after year end as opposed to the usual 9 months and some of you may have thought about taking up the advantage of delaying submissions by 3 months. Unfortunately, the HMRC have not sought to do the same for the payment of corporation tax which still needs to made 9 months after financial year end. So whilst you have extra time given by Companies House, if you have any tax liability paid after the 9 month period you will incur interest. So the only clients that are likely to benefit from the extension to the deadline are those that have no corporation tax liability (ie you know that you will have losses in the current year or losses brought forward) or who pay their tax in instalments!

Our view at Rajani & Co is that whilst the extra time might appear appealing, it simply delays the inevitable and prevents you from preparing/planning for the future.

Our view at Rajani & Co is that whilst the extra time might appear appealing, it simply delays the inevitable and prevents you from preparing/planning for the future.

1. What your corporation tax liability is and avoid interest charges by paying on time

2. The amount of salary and dividends taken for self-assessment purposes

3. Your personal tax liability by enabling us to complete your self-assessment tax return at the same time

4. And prepare and plan for the following year.

In addition to our usual services including book-keeping, payroll, company accounts, tax returns, reference letters, business plans, loan applications and other commercial and financial planning assistance. If you have any queries, please do contact us

I think that is all for now!