Personal Tax Update – 22/5/2020

In another information packed week, below is a summary of the key changes announced.

Coronavirus (COVID-19): job retention scheme

HMRC has updated the coronavirus job retention scheme (CJRS) guidance with several changes:

• the guidance note on ‘working out 80% of your employees’ wages to claim through the CJRS ’ has been updated with additional information on non-discretionary payments, the periods a claim should cover and how far in advance claims can be made
• the ‘claim for wages through the CJRS ’ guidance page has been updated to add that records must be retained for at least six years after making a claim
• the guidance on ‘checking if you can claim for your employees’ wages through the CJRS ’ has been updated to cover the extension of the scheme and also furloughed employees who want to volunteer
• information on employees who can be put on furlough has been moved to a new guidance page: ‘Check which employees you can put on furlough to use the CJRS ’

Coronavirus: reclaiming statutory sick pay (SSP) paid to employees

The Government has announced  that a new online service will be launched on 26 May 2020 for small and medium-sized employers to recover SSP payments they have made to their current or former employees for eligible periods of sickness starting on or after 13 March 2020.

HMRC’s guidance  has been updated to reflect this information and to provide information on the details that employers will need to have to make a claim.

Regulations have been laid to provide for this reclaim process also.

SI 2020/512.

Coronavirus: tax rules on waiving income or donating to charity

HMRC has published guidance on how to treat certain expenses and benefits provided to employees during the coronavirus outbreak. It covers topics on living accommodation, volunteer fuel and mileage costs, paying or refunding transport costs, free or subsidised meals, company car ‘availability’, salary sacrifice, employer-provided loans, employees working from home, and how to report such expenses and benefits to HMRC.

Coronavirus: treatment of certain expenses and benefits provided to employees

HMRC has updated its guidance  to add a new section about Employee Car Ownership Schemes (ECOS), covering the situation where, because of coronavirus, an employee has not been able to return the car in accordance with the terms of the scheme.

More information has also been added on reimbursing expenses incurred by employees on office equipment to enable them to work from home .

HMRC guidance for trustees

HMRC has updated its guidance  on managing a trust to add information about the type of changes that can be made to information held on the Trust Register, using HMRC’s online service, the deadlines for updating those details and the annual declaration that the details are correct.

It has also published new guidance for trustees on registering a trust. This includes information on who should register and who should not, when to register, details required for registering, how to register, and the procedure followed after a trust is registered.

You must register your trust with HMRC if the trust becomes or is liable for any of the following taxes:

• Capital Gains Tax
• Income Tax
• Inheritance Tax
• Stamp Duty Land Tax
• Stamp Duty Reserve Tax
• Land and Buildings Transaction Tax (in Scotland)
• if you need to get a Unique Taxpayer Reference (UTR) – for example, for filling in a Self Assessment tax return for the trust
• to make sure you and the trust comply with anti-money laundering regulations

Trust should not be registered if:

• the trust has to pay Income Tax of less than £100 and this only came from interest
• the trust is a bare trust
• only the settlor or beneficiary of the trust has to pay tax
• the trust is a charitable trust and you do not have to pay any tax on its income or assets
• the assets in the trust go back to the settlor (a ‘resulting’ trust), for example, when the trust ends, and all the beneficiaries have died
• the trust has been created by legislation (a ‘statutory’ trust), for example, when a person dies without making a valid will and the estate passes to their relatives under the intestacy rules
• the trust has been imposed by a court (a ‘constructive’ trust), for example, when someone has acted improperly or to hold compensation for a child aged under 18

For any further information or queries please do not hesitate to contact us.

Source – Lexis Nexis via Tolley Guidance