Welcome to the January 2022 'Need to Know' update. You'll find the latest key information on tax returns, grant information on your self-assessment, Scottish and Welsh business support in the wake of Omicron, extending licensing hours for the Queen's birthday, changes to customs excise and VAT for goods from the EU, and a crackdown of rogue company directors by HMRC.
More than 31,000 Self Assessment customers submitted their tax return for the 2020 to 2021 tax year over the festive period.
HM Revenue and Customs (HMRC) has revealed that 2,828 customers filed their Self Assessment tax return on Christmas Day, compared to 2,700 in 2020.
For thousands of business owners and self-employed, filing their tax return on 25 December has become part of their Christmas tradition, with 227 choosing to complete their Self Assessment between 12:00 and 12:59.
In total, more than 31,000 people submitted their 2020 to 2021 tax return between Christmas Eve and Boxing Day – getting it in early ahead of the deadline on 31 January 2022, and most festive filers completed their return on 24 December:
- Christmas Eve: 19,802 tax returns were filed. The peak time for filing was 11:00 to 11:59 when 2,914 returns were received
- Christmas Day: 2,828 tax returns were filed. The peak time for filing was 12:00 to 12:59 when 227 returns were received
- Boxing Day: 8,641 tax returns were filed. The peak time for filing 12:00 to 12:59 when 821 returns were received
You can read more here
Scottish businesses allocated £107 million support
Targeted funding to help mitigate the impact of Omicron.
First Minister Nicola Sturgeon has announced how £107 million is being allocated to support businesses impacted by the spread of the Omicron variant.
The funding, which follows an initial £100 million lifeline package, means the Scottish Government has now allocated £207 million of the £375 million committed to business support. Following discussions with stakeholders, this latest package is targeted at some of the hardest hit sectors and payments will start in the new year.
Business support is being provided to mitigate the impact of public health measures introduced to limit the rapid spread of the Omicron variant. Proportionate restrictions have been implemented for at least three weeks to allow immunity from the accelerated booster vaccination programme to take effect.
Decisions on the allocation of the remaining £168 million will be confirmed following consultation with affected sectors on how it can best be targeted
The latest £107 million support package is broken down into:
- £32 million more for hospitality and leisure businesses
- £10 million targeting parts of the hospitality industry most severely affected by requirement for table service
- £5 million targeted support for nightclubs now required to close
- £27 million for culture, due to impact of physical distancing and caps on attendance
- £17 million for events, due to impact of physical distancing and caps on attendance
- £16 million for existing public transport COVID-19 support schemes to recognise the impact on fare revenue
Final details of the funding available for each sector is being determined in discussion with business and sector organisations and will be published as soon as possible.
Hospitality businesses will be contacted by their local authority to access top up funding through the December and January Business Top Up.
You can read more here.
£120m financial support for businesses in Wales impacted by Omicron
Businesses in Wales impacted by the rapid spread of the Omicron virus will be eligible for emergency financial support under a new Welsh Government support package.
The Economy Minister, Vaughan Gething, has announced the details of the £120m funding which will be available for retail, hospitality, leisure and tourism business and their supply chains affected by the move to alert level 2, as announced by the First Minister on Wednesday 22 December.
Under the latest package, retail, hospitality, leisure and tourism business who pay Non Domestic Rates will be entitled to a payment of £2,000, £4,000 or £6,000 depending on their rateable value. Businesses will need to re-register their details, through a quick and easy online process, with their local authority in order to receive their payments.
Registration will open via local authority websites from the week commencing 10 of January.
The Welsh Government has decided to extend this support to non-essential retail so that smaller shops, and Travel Agents will be supported and our high streets can continue to thrive. In England, support is not available to non-essential retail.
In addition, impacted hospitality and leisure businesses and their supply chains will be able to apply for top up funding from a new Economic Resilience Fund (ERF). Eligible businesses can apply for grants of between £2,500k - £25,000, with grants dependent on their size and number of employees. The application window for ERF will open in week commencing 17 January 2022 with payments starting to reach businesses within days.
Local Authorities will also administer a Discretionary fund for business and sole traders who do not pay rates. The fund will provide £500 to sole trader and freelancers and £2,000 to employing businesses in impacted sectors. Further details to follow on Business Wales.
An eligibility checker which will help businesses to gage how much they can expect to receive under the new support package will be available on Business Wales by the start of 2022.
You can read more here.
Consultation to extend licensing hours for Queen's Platinum Jubilee
Pubs, clubs and bars could be allowed to stay open for an extra two hours over extended Bank Holiday weekend.
The government will seek to extend licensing hours across England and Wales to mark Her Majesty The Queen’s Platinum Jubilee next year, Home Secretary Priti Patel has announced.
The Platinum Jubilee will mark Her Majesty’s 70-year reign and a blockbuster weekend of celebrations is planned. This will include a 4-day bank holiday weekend from Thursday 2 June until Sunday 5 June to allow the nation to celebrate this historic milestone.
To support the celebrations, the Home Office will shortly launch a public consultation on extending licensing hours for pubs, clubs and bars from the normal 11pm to 1am on Thursday 2, Friday 3 and Saturday 4 June.
Section 172 of the Licensing Act 2003 allows the Home Secretary to make a licensing hours order, giving permission to premises to open for specified, extended hours to mark occasions of exceptional international, national or local significance.
The extension of licensing hours will be subject to a month’s public consultation, giving the public the opportunity to submit their views on the proposals as well as seeking the views of specific stakeholders, including the police, licensing authorities and alcohol awareness groups.
The public consultation will ask for an extension of licensing hours for premises already licensed for the sale of alcohol for consumption and premises already licensed for the provision of regulated entertainment.
The consultation will focus on whether licencing hours should be extended and the scope of a licensing hours order, including the dates, times, geographical extent and licensable activities to which it should apply.
Past national occasions where the government has extended licensing hours have included the royal wedding in 2018, when the government extended licensing hours until 1am for two nights to facilitate the country’s celebrations. Licensing hours have also previously been extended for The Queen’s 90th birthday in 2016, the FIFA World Cup in 2014, The Queen’s Diamond Jubilee in 2012 and the royal wedding in 2011.
Her Majesty The Queen’s Platinum Jubilee will see a 4-day bank holiday weekend from 2 to 5 June which includes Trooping the Colour, the lighting of beacons, a Service of Thanksgiving, a concert, Platinum Pageant and nation-wide street parties.
You can read more here.
£21 million for future of Wales’ voluntary sector
£7 million a year has been allocated to support Wales’ voluntary sector over the current Welsh Government’s term, a commitment of over £21 million across the next 3 years.
The announcement follows the publication of the draft Budget by Finance Minister Rebecca Evans last week (Monday 20 December).
This is in addition to around £7 million provided every year by the Welsh Government’s Community Facilities Programme, a grant scheme of up to £250,000 for the improvement of local community projects and facilities.
The £7 million of annual funding, beginning in 2022, will be provided to the Third Sector Support Wales. This partnership comprises of 20 organisations - 19 County Voluntary Councils supporting each county area and the national membership body for voluntary organisations, Wales Council for Voluntary Action (WCVA).
These organisations provide an infrastructure to all of Wales’ voluntary sector organisations under 4 pillars of activity identified in partnership with Welsh Government:
- good governance
- sustainable funding
- engagement and influencing.
Additionally, the long-standing Community Facilties Programme will continue to provide small and large grants to well-used community projects to improve their sustainability and provide opportunities for local people to improve their day-to-day lives.
You can read more here.
Government seeking views on a ban of the retail sale of peat in horticulture by end of this Parliament.
Plans to ban the use of peat in horticulture in England and Wales by the end of this Parliament were set out by the Government recently (Saturday 18 December) in an effort to protect precious peatland habitats and meet net zero targets.
Peatlands are the UK’s largest carbon store and are routinely dug up in the UK for horticultural purposes, such as for growing media. Bagged retail growing media accounts for 70% of the peat sold in the UK. When this extraction takes place, the carbon stored inside the bog is released as carbon dioxide, contributing to climate change.
Peat extraction also degrades the state of the wider peatland landscape, damaging habitats for rare species of flora and fauna, and negatively impacting peat’s ability to prevent flooding and filter water.
In a consultation published recently, the Government has set out measures to phase out the sale of peat and peat-containing products in the amateur sector by the end of this Parliament. Organisations with an interest in peatland protection, horticultural businesses and associations, and those who import and export peat products, are being asked for their views on new measures to end the use of peat products in horticulture.
The 12-week consultation is also seeking views on:
- Introducing point-of-sale measures for bagged growing media, such as a point-of-sale charge for the purchase of any growing media bag containing peat; and mandatory labelling and point-of-sale material containing detail of the environmental reasons for eschewing products containing peat.
- Mandatory reporting of the volume of peat sold for all sellers of peat and peat containing products.
- Potential exemptions, including for scientific purposes and a maximum amount of peat allowed in certain products, which will need to be strictly defined and enforced to prevent exploitation.
Sustainable alternatives to peat which are of comparable quality to peat-based products are currently available. These are often made up of peat-free materials derived from more sustainable sources, for example wood fibre and bark, green compost, wool, coir and other materials.
You can read more here.
HMRC urges businesses to prepare for January customs changes
Some of the temporary Customs and VAT easements introduced on 1 January 2021 for goods moving between Great Britain and the EU were removed on 1 January 2022.
Businesses trading with the European Union (EU) must now be ready for the new import and exports customs controls which came into force from 1 January 2022.
HM Revenue and Customs (HMRC) can help traders and businesses adapt to these changes and has been working with traders to help them get ready. This includes sending letters and emails, and delivering webinars for traders explaining the new customs rules, the action that they need to take, and the support on offer from HMRC.
Current customs arrangements for goods moving from Ireland and Northern Ireland to Great Britain will be extended for as long as discussions between the UK and EU on the operation of the Northern Ireland Protocol are ongoing.
This means that full customs controls have been introduced as planned on 1 January 2022 for goods moving between the rest of the EU and Great Britain, and for goods exported from Great Britain to Ireland.
The changes to customs and tax rules will affect everyone who trades with Europe, no matter the type or value of the goods they buy or sell, how frequently they trade or how their goods are transported.
The changes coming into force on 1 January 2022 include:
- requirement for full customs import declarations for all goods at the time businesses or their courier/freight forwarder bring them into Great Britain, except if they are non-controlled goods imported from Ireland to Great Britain
- customs controls at all ports and other border locations
- requirement for a suppliers’ declaration proving the origin of goods (either UK or EU) if they are using the zero tariffs agreed in the UK’s trade deal with the EU
- commodity codes, which are used to classify goods for customs declarations, are changing
Further information explaining these changes, what they mean for businesses, and how to prepare, is available on GOV.UK.
Don’t forget to declare COVID-19 grants on your tax return
HM Revenue and Customs (HMRC) is reminding Self Assessment customers to declare any COVID-19 grant payments on their 2020 to 2021 tax return.
More than 2.7 million people claimed at least one Self-Employment Income Support Scheme (SEISS) payment up to 5 April 2021. These grants are taxable and people should declare them on their 2020 to 2021 tax return before the deadline on 31 January 2022.
The SEISS application and payment windows during the 2020 to 2021 tax year were:
- SEISS 1: 13 May 2020 to 13 July 2020
- SEISS 2: 17 August 2020 to 19 October 2020
- SEISS 3: 29 November 2020 to 29 January 2021
SEISS is not the only COVID-19 support scheme that people should declare on their tax return. If people received other support payments during COVID-19, they may need to report this on their tax return if they are:
- in a partnership
- a business
Information on which support payments need to be reported to HMRC and any that do not is available on GOV.UK.
It is important that customers check and make any changes to their tax return to make sure any SEISS or other COVID-19 support payments have been reported correctly in their Self Assessment.
HMRC recently announced that more than 20,000 people, who were unable to pay their tax bill in full, had used the self-serve Time to Pay facility, worth £46 million. The online payment plan helps people who may feel worried or anxious about paying any tax owed by enabling them to spread the amount into manageable monthly instalments, up to the value of £30,000.
If people owe more than £30,000, or need longer to pay, they should call the Self Assessment Payment Helpline on 0300 200 3822.
Crackdown on directors who dissolve companies to evade debts
Rogue directors who dissolve their companies and avoid paying liabilities to staff, creditors and the taxpayer can now be disqualified from being a director.
The Insolvency Service has been granted new powers to tackle unfit directors who dissolve companies to avoid paying their liabilities.
The new legislation extends the Insolvency Service’s powers, on behalf of the Business Secretary, to investigate and disqualify company directors who abuse the company dissolution process.
The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act will also help tackle directors dissolving companies to avoid repaying Government backed loans put in place to support businesses during the Coronavirus pandemic.
The Insolvency Service has powers to investigate directors of companies that enter a form of insolvency, including administration and liquidation. The Insolvency Service may also be instructed to investigate live companies where there is evidence of wrongdoing.
This Act extends those investigatory powers to directors of dissolved companies and if misconduct is found, directors can face sanctions including being disqualified as a company director for up to 15 years or, in the most serious of cases, prosecution.
The Business Secretary will also be able to apply to the court for an order to require a former director of a dissolved company, who has been disqualified, to pay compensation to creditors who have lost out due to their fraudulent behaviour.
The Act also delivers on the commitment to rule out COVID-19-related changes as grounds for material change of circumstances (MCC) business rate appeals. This is due to the fact that market-wide economic changes to property values, such as from COVID-19, can only be properly considered at general rates revaluations.
To support this, the government is providing £1.5 billion in business rates relief to sectors which have suffered most economically over the pandemic and not been eligible for existing support linked to business rates. Guidance published on 15 December 2021 will support local authorities to set up their local schemes through which businesses will be able to access relief.
You can read more here.