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12 May 2020SEISS Application process

As HMRC contacts taxpayers who may be eligible for the Self-employment Income Support Scheme (SEISS) and the application portal opens, we have summarised how the process works

Pre-application stage

Emails, SMS messages and letters have been sent to taxpayers who HMRC thinks may be entitled to claim an SEISS grant. These were sent during the week beginning 4 May 2020, some letters may not have been received until the following week.

Each taxpayer received one form of contact:

where HMRC holds an email address it used that;

SMS was used where HMRC holds a mobile number, but not an email address; and

a letter was sent where HMRC holds neither. 

Note that to guard against fraud the emails and SMS messages from HMRC do not include active links. If a taxpayer receives an email or SMS purporting to come HMRC which includes an active link, that email or SMS is a scam.

This initial contact explained what the taxpayer needs to do to be ready to claim when the claims portal opens. 

HMRC contacted all those who may be eligible, but not all recipients will in fact be eligible. HMRC has selected the cases based on the information in the self assessment tax returns filed by the taxpayers and has carried out the necessary calculations and eligibility checks based on those figures. However, HMRC does not necessarily know whether the taxpayer meets the following conditions of the scheme:

traded in the tax year 2019/20;

intend to continue to trade in the tax year 2020/21; and

carry on a trade which has been adversely affected by coronavirus.

HMRC is providing an eligibility checker to allow taxpayers to check whether HMRC believes they may be eligible for a grant.

Eligibility checker

The eligibility checker is available on gov.uk and is open to anyone to use, not just those who have been contacted by HMRC. click link: checker

The taxpayer enters their self assessment UTR and national insurance number and the checker confirms whether HMRC believes they may be eligible. The taxpayer does not need to enter any information about their income. The checker does not require the taxpayer to log in to their government gateway account but, in the background, it looks at the tax return information held on HMRC’s system to provide a result. The checker does not give any information about the amount of grant available.

The checker tells potentially eligible taxpayers when they can make a claim (the dates and times are randomly allocated by HMRC to manage demand on the system). The taxpayer is then presented with an option to either log in to their government gateway account or to create one. They are then asked to confirm or provide their contact details including email address.

The eligibility checker can be used by agents who know their client’s self assessment UTR and national insurance number.  

Watch HMRC's video: SEISS using the eligibility checker

Creating a government gateway ID

Taxpayers who already have a government gateway ID which gives access to HMRC’s self assessment services will be able to use that ID when applying for their SEISS grant. 

Those who do not have a government gateway ID are prompted to create one when they use the eligibility checker and, if they do not do so, as the first step of the application stage. Our advice is that at the eligibility checker stage is the preferred option to avoid delays.

When creating an ID through the SEISS service, the taxpayer is asked to verify their identity by providing details from their driving licence photocard or their UK passport. Taxpayers without either of these documents will be asked for a piece of financial information, for example, the date they set up a mobile phone contract. 

When a government gateway ID is created as part of the SEISS service there is no requirement for an authentication code (PIN) to be sent in the post. 

Taxpayers who need to create a government gateway ID to claim an SEISS grant are advised to do so through the SEISS service, rather than through any other route on gov.uk, to ensure the correct type of ID is set up and to avoid the need for an authentication code in the post.  

How to apply

Applications open to taxpayers on a staged basis between 13 and 18 May, with the portal opening on different days for different taxpayers. HMRC is sending reminder emails to taxpayers who have provided an email address (when using the eligibility checker or previously) to confirm when the portal is open for them or may send an SMS message. Taxpayers can also use the eligibility checker at any time to check whether the application portal is now open for them.

Taxpayers then log in to their government gateway account (or select the option to create an account) to complete the application process. They are presented with a calculation of the amount of the grant and are asked to:

read and accept the eligibility criteria;

complete declarations, including to confirm that the business has been adversely affected by coronavirus; and

supply the bank account details into which they would like the grant to be paid.

The taxpayer does not need to provide any information about their income – the calculations are all done by HMRC based on the tax returns submitted. HMRC will check the claim and expects to make payments by 25 May 2020 or within six working days of the application being submitted. 

There is, at the moment, no deadline by which claims must be submitted.

Helpful wee video we think

USING YOUR AGENT

Following confirmation of the application process for SEISS, ICAS, along with other bodies had pressed HMRC for agents to be included in the process and recognises that members will be “very disappointed” that they are unable to make claims for their clients.

We understand that HMRC considered the issue of agent access, but the need to make payments as soon as possible resulted in HMRC taking the decision that claims would have to be made by the taxpayer only. However, and unlike the job retention scheme, HMRC will be making the calculations for the claims rather than the taxpayer or their agent, with the result that claiming under the scheme should be much simpler.

Agents still have a potentially important role in helping their clients with SEISS. Agents can use the newly built eligibility checker on behalf of their clients and can also request a review if the checker gives a ‘not eligible’ result when the agent thinks that they should be eligible. Clients may also want help with understanding the calculation.

We advise against clients setting up a new government gateway ID in advance of making an application, but instead doing so as the first step in the application process. This will ensure that the correct type of credentials are set up and avoids the need to wait for an authorisation code in the post (that this requirement is suspended for those that set up government gateway credentials as part of the SEISS service).

HMRC will be providing a telephone-based application service for the digitally excluded, further details are awaited.

HMRC has advised that agents should not use client credentials to apply for grants on behalf of clients and that doing so may trigger HMRC fraud checks and delay payment of the grant.

28 April 2020Small business boosted by bounce back loans from HMRC

News story

Small businesses boosted by bounce back loans

New 100% government backed loan scheme for small business

Published 27 April 2020

From:

HM Treasury

businesses will be able to borrow between £2,000 and £50,000 and access the cash within days

loans will be interest free for the first 12 months, and businesses can apply online through a short and simple form

Small businesses will benefit from a new fast-track finance scheme providing loans with a 100% government-backed guarantee for lenders, the Chancellor announced today (Monday 27 April).

Rishi Sunak said the new Bounce Back Loans scheme, which will provide loans of up to £50,000, would help bolster the existing package of support available to the smallest businesses affected by the coronavirus pandemic.

The scheme has been designed to ensure that small firms who need vital cash injections to keep operating can get finance in a matter of days, and comes alongside the £6 billion awarded in business grants, supporting 4 million jobs through the job retention scheme and generous tax deferrals supporting hundreds of thousands of firms.

The government, which has been consulting extensively with business representatives about the design of the new scheme, will provide lenders with a 100% guarantee for the loan and pay any fees and interest for the first 12 months. No repayments will be due during the first 12 months.

The loans will be easy to apply for through a short, standardised online application. The loan should reach businesses within days- providing immediate support to those that need it as easily as possible.

The Chancellor of the Exchequer, Rishi Sunak, said:

Our smallest businesses are the backbone of our economy and play a vital role in their communities. This new rapid loan scheme will help ensure they get the finance they need quickly to help survive this crisis.

This is in addition to business grants, tax deferrals, and the job retention scheme, which are already helping to support hundreds of thousands of small businesses.

Business Secretary Alok Sharma said:

Our small businesses are vital in ensuring our communities thrive and will be crucial in creating jobs and securing economic growth as we recover.

This rapid loan scheme offers additional protection so small companies across the country can get access to the finance they need immediately, as part of the unprecedented package of support we have put in place.

The scheme will launch for applications on Monday 4 May. Firms will be able to access these loans through a network of accredited lenders.

The government will work with lenders to ensure loans delivered through this scheme are advanced as quickly as possible and agree a low standardised level of interest for the remaining period of the loan.

Notes

Our Covid-19 support schemes have provided over £15 billion for business in just a few weeks. We’ve put in place:

our job retention scheme - more than 500,000 claims have been made to the value of £4.5 billion

business grants - half a million business properties have benefitted from £6 billion of business grants

the Coronavirus Business Interruption Loan Scheme - with over 20,000 loans

the Covid Corporate Financing Facility, which has provided over £14 billion for larger firms

generous VAT deferrals worth billions of pounds

scrapped businesses rates

covering the cost of statutory sick pay

the new scheme will run alongside the existing Coronavirus Business Interruption Loan Scheme (CBILS) and Coronavirus Large Business Interruption Loan Scheme (CLBILS)

We are also taking additional steps on the Coronavirus Business Interruption Loan Scheme (CBILS) to ensure that lenders have the confidence they need to process finance applications quickly, including removing the per lender portfolio cap for the government guarantee, and changing the viability tests that so that all banks will need to assess is whether a business was viable pre COVID-19

Reactions from business

Mike Cherry, Federation of Small Businesses National Chairman, said:

This crucial new initiative should enable thousands of small businesses to access the working capital they need quickly, helping to protect the millions of jobs they provide in every part of the UK.

This step forward marks another decisive intervention from the Treasury and the Business Department, building on existing support in an innovative way. Swift delivery is now key, and we also look forward to working with government in the long-term to enhance market competition, including that provided by non-bank lenders.

We are pleased to see the Chancellor and the Business Secretary listening to the needs of small businesses, and we will continue to work with them to make sure small firms and the jobs they provide are protected throughout this public health challenge and that small firms are at the forefront of leading the recovery.

Dame Carolyn Fairbairn, CBI Director-General, said:

The Chancellor’s new 100% guaranteed loan scheme for small businesses is transformational. Sole traders, micro-firms and entrepreneurs will now have a simple route to fast finance to stay afloat, without red tape or time-consuming checks.

Thousands of businesses could be saved by this lifeline. Banks now need to continue their work in overdrive to get the loans flowing faster.

It’s good to see the Chancellor listening to business, proving that where there’s a need to adjust schemes, he will do what it takes. It will be vital to maintain this approach in the months to come. Every job saved today will ensure a faster recovery tomorrow.

Jonathan Geldart, IoD Director General:

This is a welcome intervention, which should help ensure more firms can access the finance that could see them through this crisis. Business leaders will appreciate the government’s continued flexibility in adapting their response to what’s happening on the ground.

It’s crucial that the government’s support cuts through to those who need it. Having a quick and simple process will be vital, and we need to remember that taking on debt is always a difficult decision for small firms.

Adam Marshall, BCC Director General:

The Chancellor has demonstrated he is listening to the concerns of our business communities and taking steps to get cash to the front line where it is needed.

This new route for our smallest companies to apply quickly and get a fast decision will be crucial to those who have struggled to get a CBILS loan.

HMRC website link

Small businesses boosted by bounce back loans

22 April 2020Scottish Government extends Aid to Newly self employed/Tourism etc

Distressed SMEs and newly self-employed given lifeline by Scottish Government

Further details of how the £100 million support package will be broken down.

As anticipated, the Scottish Government has announced a further £100 million in grants is being made available for newly self-employed, micro and SME businesses in distress, who are ineligible for other Scottish or UK Government schemes.

This lifeline support was confirmed late on Tuesday 21st April along with further details below of how it will be broken down:

£34 million Newly Self-Employed Hardship Fund, managed by Local Authorities, will be allocated to the newly self-employed facing hardship through £2,000 grants

£20 million Creative, Tourism & Hospitality Enterprises Hardship Fund, managed by the Enterprise Agencies in partnership with Creative Scotland and VisitScotland for creative, tourism and hospitality companies not in receipt of business rates relief

£45 million Pivotal Enterprise Resilience Fund, managed by the Enterprise Agencies for vulnerable SME firms who are vital to the local or national economic foundations of Scotland

As well as this, the Scottish Government is providing £1 million to top up Creative Scotland’s Bridging Bursaries in the not-for-profit sector.

The recently self-employed, who are currently excluded from the UK’s scheme, but suffering hardship, will be able to receive £2,000 grants. For creative, tourism and hospitality companies of up to 50 employees not receiving business rates relief, there will be rapid access £3,000 hardship grants or larger grants of up to £25,000 where it can be demonstrated support is needed. The support and larger grants for pivotal SME enterprises will depend on the specific need of the enterprise and will be developed by the relevant enterprise agency with wrap around business advice and support.

The grant funding is expected to be open for applications by the end of April, and recipients will receive funds in early May.

Coronavirus Business Support Finder Tool

With a number of loans, tax reliefs and cash grants now available for business, the UK Government has now created a tool to help enable you to quickly check what support you and your business may be eligible for. We would recommend all business owners do a quick check that they have applied for all loans and grants available. Follow this link to complete the questionnaire.

If you have any questions or would like to discuss the impact of Coronavirus on your business, please get in touch

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