February 2022

Welcome to our monthly email to keep you informed of the latest business and tax issues. Please do contact us if you have any questions.

Self assessment tax interest and penalties

Any tax owing to HMRC in respect of the tax year ended 5 April 2021 that has not been paid is subject to interest, but penalties will only apply on amounts unpaid as at 1 April 2022.

Therefore, a payment plan with HMRC is recommended as that prevents penalties being applied if payment cannot be made before 1 April 2022. The payment plan can be set up online through the personal tax account or by telephoning HMRC on 0300 200 3822.

Penalties are not charged on payments on account that were due by 31 January 2022 but interest will be added on amounts unpaid and HMRC will expect the payments on account to be added to any payment plan. If the payments on account are likely to be too high, a reduction can be considered before the payment plan is set up.

If the payments on account are reduced more than they should be, interest will be charged.

If you are concerned about your tax payment, please do telephone us to consider your options.

Government scheme gives discounts of up to £5,000 on accounting software

The government's Help to Grow: Digital scheme – designed to support smaller businesses in adopting digital technologies – is now open for applications.

Under the scheme, eligible businesses can now receive discounts of up to £5,000 off the retail price of approved digital accounting and CRM software from leading technology suppliers.

Businesses can also access practical, specialised support and advice on how to choose the right digital technologies to boost their growth and productivity.

Currently three accounting software providers are signed up to the scheme – Sage, Intuit and E-crunch. The next phase of the programme will see the scheme extended to e-commerce software.

Claims portal reopens for Statutory Sick Pay Rebate Scheme

HMRC has reopened a claims portal for small employers to again claim refunds for coronavirus (COVID-19)-related sick pay.

The reopening follows the announcement of the reintroduction of the Statutory Sick Pay Rebate Scheme (SSPRS) from 21 December 2021 for employers with fewer than 250 employees by the government.

The maximum claim per employee is two weeks at the statutory sick pay (SSP) rate of £96.35 per week (£192.70 in total). The employer's claim is also capped at the number of employees in its PAYE scheme on 30 November 2021.

The claims portal reopened on 19 January 2022 and employers can check the eligibility of their claims on GOV.UK.

HM Treasury and HMRC have not announced an end date for the SSPRS. However, the legislation states that a claim may not be made after 24 March 2022.

Consumer group urges taxpayers to avoid using refund firms to claim tax rebates

Consumer group Which? has urged taxpayers to avoid using so-called 'refund firms' to claim tax rebates.

Which? stated that people are losing hundreds of pounds by using third-party companies to claim tax rebates rather than going directly to HMRC.

Research carried out by the group found that one in five people had been either contacted directly by a tax refund company via email, phone, letter or text message or found one online.

Two in five of those contacted by a tax refund company said they used it in order to claim a tax rebate. Such companies often charge fees anywhere between 25% to 48% of the rebate an individual receives. Extra admin fees and VAT are often added on top, according to Which?

National insurance rise 'set to squeeze budgets', warns CBI

The Confederation of British Industry (CBI) has warned the government that the planned rise in national insurance will squeeze budgets and affect economic growth.

The rise will see employers, employees and the self-employed pay 1.25p more in the pound from April 2022. From April 2023, the extra tax will be collected as part of the new Health and Social Care Levy.