Landlord update – Capital Gains Tax – 30 day payment and reporting

There are changes to the capital gains tax (CGT)
deadline for reporting the sale of residential
property in the UK, and paying any CGT liability.
This will affect property you let out: though if you
have at any time occupied such property as your
main private residence, different rules may come
into play.

From 6 April 2020, sales must be reported to
HMRC, and any CGT paid, within 30 calendar
days of completion. Interest and penalties apply
if this is not done within the time limit. The rules
were eased in with a temporary exception to late
filing penalties, though this is about to expire.

For UK residents, the late filing easement covers
transactions completed between 6 April 2020 and
30 June 2020, and reported up to 31 July 2020.
Transactions completed from 1 July 2020, however,
will incur a late filing penalty if not reported within
30 calendar days. Interest accrues if tax is unpaid
after 30 days.

In the past, payment and reporting were made via
the self assessment tax return. A disposal in the
tax year ending 5 April 2020, for example, would
be reported on the tax return for 2019/20, due
for submission by 31 January 2021. Accelerating
the payment window obviously has considerable
consequences for cash flow, with the need for
funds to be in place to settle any liability. It also
means the immediate need for a CGT calculation,
even if the detail is subsequently refined in the self
assessment return.

Trivial Benefits

What are trivial benefits? An explanation of the staff benefits you can give without incurring tax. From April 2016, legislation was introduced providing clarity as to what small benefits are deemed to be trivial and therefore exempt from tax and reporting obligations.

Conditions to be satisfied

– the cost of providing the benefit cannot exceed £50 per employee (including VAT), or the average cost per employee if provided to a group of employees and it is impracticable to work out the exact cost;

– the benefit is not cash or a cash voucher (but gift cards would qualify as long as they are not exchangeable for cash);

– the employee is not entitled to the benefit as part of any contractual obligation (including under salary sacrifice arrangements);

– the benefit is not provided in recognition of particular services performed (or in anticipation of such services) or as part of their normal employment duties.

If any of these conditions are not satisfied then the benefit is taxed in the normal way – via a P11D, PSA or taxed through the payroll. Also, if the cost of the benefit exceeds £50, the whole amount will be taxable rather than just the excess.

Close company? 

In most instances, an employee can receive multiple trivial benefits throughout the year, as long as each one does not exceed £50. However, where the employer is a close company, the exemption is capped at a total cost of £300 in the tax year where the benefit is provided to an individual who is a director or other office holder of the company (or a member of their family or household).

Examples of trivial benefits

Per HMRC’s guidance, some types of examples of trivial benefits are:

– taking a group of employees out for a meal to celebrate a birthday

– buying each employee a Christmas present or birthday present

– flowers on the birth of a new baby

– a summer garden party for employees 

The aforementioned is on the basis that the benefit per employee does not exceed £50.

Furloughing employees – FAQs for employers on the coronavirus job retention scheme

The new Coronavirus Job Retention Scheme will provide UK employers with support for paying staff wages. The scheme involves furloughing employees. How will it work?

The government has now issued official guidance for employers on claiming for wage costs through the scheme and there is separate guidance for employees. Below we answer the key questions and highlight some of the remaining uncertainties.

Summary of the scheme

  • The scheme applies to all employees who were on the payroll on 28 February 2020, on any type of contract so long as they were paid under PAYE.  It also applies to employees who were made redundant on or after 28 February 2020, who can be re-employed and then furloughed.  Employers can furlough employees whose roles are not entirely redundant but who have less work to do than they usually would, so long as they do not do any work during the furlough period.  
  • HMRC will reimburse 80% of furloughed workers’ usual wage costs, up to a cap of £2,500 (gross) per worker per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer contributions on that wage.  There is no obligation to top up to full salary, although employers can elect to do so.  There is also no obligation to top up to national minimum wage if the 80% takes an employee below the minimum (unless the employee is doing training).
  • Employees cannot do any work for employers whilst they are on furlough. They can do volunteer work, or training if this does not provide services to or for the employer, or generate revenue for the employer
  • An employee must be furloughed for a minimum period of 3 weeks.  A furloughed employee can then return to work, and put on furlough again later if needed.

When will the scheme be ready?

The government’s intention is to have the scheme up and running by the end of April so that the April payroll can be reimbursed through the scheme. Claims can be backdated to 1 March 2020. Employers do not, however, need to wait until the grant scheme is up and running to put employees on furlough.

Which employers is the scheme open to?

The scheme will be available to all UK employers, including businesses, charities, recruitment agencies and public authorities, of any size and in any sector. To be eligible, employers must have created and started a PAYE payroll scheme on or before 28 February 2020 and have a UK bank account.

How much can employers claim?

HM Revenue & Customs (HMRC) will reimburse 80% of furloughed workers’ usual wage costs, up to a cap of £2,500 (gross) per worker per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer contributions on that wage.

Fees, commission and bonuses cannot be claimed for.

For salaried employees, you must use the actual salary before tax, as of 28 February.

For employees whose pay varies (for example because they work shifts) you can claim for the higher of either:

  • the same month’s earning from the previous year
  • average monthly earnings from the 2019-20 year

If an employee with variable pay has been employed for less than a year, you can claim for an average of their monthly earnings since they started work. If the worker only started in February 2020, you should use a pro-rata approach.

Do we have to top up the subsidy?

No. You can top up the subsidy if you wish, but you do not have to do so. For employers that are topping up, a key question is how to maintain a fair differential between furloughed employees and any employees who are still working.

What if the subsidy is less than the minimum wage? Do we have to top it up?

No. Workers are only entitled to the National Minimum Wage/National Living Wage for the hours they are working. You do not need to ensure that they are receiving NMW/NLW rates while on furlough.

The position is different, however, if you are asking workers to complete training – see below.

Is it a grant or a loan?

It will be a grant, not a loan, so it will not need to be repaid. Payments received by a business under the scheme must, however, be included as income in its calculation of taxable profits for Income Tax and Corporation Tax purposes – although businesses can continue to deduct employment costs as normal.

What about pension payments?

You can reclaim the minimum mandatory employer pension contribution on the subsidy. This claim can be made on top of the £2,500 cap.

The current minimum contribution under the auto-enrolment regulations is 3% of an employee’s income above £512 per month (rising to £520 per month from 6 April 2020). Pension contributions over and above this cannot be claimed through the scheme but you will need to maintain them, unless you agree something else with employees.

What about benefits such as health insurance, gym membership etc?

These will need to be maintained, unless you agree something different with furloughed employees.

It does not look as though employers can claim the cost of benefits though the subsidy (except for pension contributions). In any case, many employers will opt to maintain benefits as the simpler option, particularly if they have already paid for the cost of them.

Employers that offer permanent health insurance or death-in-service benefits should check with their scheme provider about what salary would be used in the event of a claim – would it be normal annual salary or pay during furlough?

Will the payment be taxable?

Yes, payments you make to furloughed employees will be subject to PAYE and National Insurance contributions.

How do we put someone in the furlough scheme?

You need the employee to agree to be put on furlough (see further below) and then you will need to designate them as furloughed. The guidance says that, to be eligible for the subsidy, employers should write to their employee confirming that they have been furloughed and keep a record of this communication. They need to be on furlough for at least three weeks.

Does someone need to have been on the payroll on 28 February 2020 to be put on furlough?

Yes, so you cannot use the scheme to furlough all new joiners. Employees hired after 28 February 2020 cannot be furloughed or claimed for in accordance with this scheme. Note that the key date is 28 February, even though 2020 is a leap year and there was a 29 February this year.

Can we only put people in the furlough scheme if redundancy was the alternative?

The government previously indicated that the furlough scheme was an alternative to redundancy, lay-off or unemployment. The guidance for employees refers to furlough as applying when the employer is unable to operate or has no work for the employee to do, but there is no explicit requirement in the latest guidance for employers to show that redundancy was the alternative.

It seems that HMRC may have accepted that putting employees on a furlough scheme which means they are not working is enough to show that they would otherwise have been made redundant. The guidance does state, however, that the scheme is “designed to support employers whose operations have been severely affected by coronavirus”.

Importantly, note that the government has indicated that it will retain the right to retrospectively audit employers, with scope to claw back fraudulent or erroneous claims. Ultimately, it seems that employers may be allowed some discretion, but they should not be abusing the scheme.

Can we rotate employees on furlough?

We think so, yes. Some employers have work for some staff, but not enough work for all. One of the most pressing questions since the scheme was first announced was whether employees could rotate employees on furlough or if they would have to choose some employees to be furloughed while others stayed at work. The employer guidance is unclear on this point, but the employee guidance seems to answer the question, by saying that employees can be placed on furlough more than once.

This suggests that employers can rotate employees on furlough, so long as each employee spends a minimum of three weeks on furlough. This would mean, for example, that an employer can select an initial group of employees for furlough while a second group remain at work. The first group could then come back to work while the second group take their turn on furlough.

Can employees do the odd bit of work for us while furloughed?

Definitely not. Employees cannot undertake work for or on behalf of an employer that has furloughed them. The guidance says that this includes “providing services or generating revenue”. If they do any work for you then you may have to repay the grant.

We recommend drawing this to the attention of any furloughed employee who could otherwise be doing some work from home. It is important that they don’t do anything that could jeopardise your ability to claim the grant.

Directors and owner-managers can be furloughed if on PAYE and will still be allowed to do statutory duties in these roles – this will not count as work which disqualifies them from the grant.

Can we ask employees to do training while furloughed?

Yes. A furloughed employee can do training if this does not involve providing services or generating revenue. The guidance points out that if workers are required to, for example, complete online training courses while they are furloughed, they must be paid at least the National Living Wage/National Minimum Wage for the time spent training, even if this is more than the subsidy.

Can someone in the furlough scheme do work for other employers?

Possibly. The guidance is clear that agency workers will only be eligible for the scheme if they are not working. The wording of the guidance suggests that working elsewhere may not be an absolute barrier to other types of employee being furloughed, but it is not entirely clear.

You should be able to impose restrictions on employees working elsewhere, even if this is allowed under the scheme, but you should think carefully about whether you want to do so. You will obviously want to stop furloughed employees from working for a competitor, and there will be no need to say this explicitly because the employee’s underlying contract of employment will stay in place throughout the furlough. You might want to allow furloughed employees to take on extra work in, for example, the health and social care sector or essential services.

Can furloughed employees do volunteer work?

Yes, this is allowed.

Do employees have to agree to being furloughed?

Yes – generally they do, but this does not necessarily need to entail a protracted procedure. In our view, most employees will be willing to accept furlough on basis that the other options are worse and to ensure they still have a job to return to when the crisis is over.

Can employees put themselves on furlough?

No. You, as the employer, need to designate them as furloughed.

How long can we keep workers on furlough?

The minimum length of furloughing is three weeks. An employee can however be furloughed multiple times, subject to the minimum time period of three weeks, as often as the employer and employee agree.

The scheme will be open for an initial period of three months (1 March to 31 May 2020) but it might be extended.

Employers are likely to want to reserve the right to call employees back from furlough if trading conditions improve.

When can we start claiming?

The subsidy applies from when an employee is placed on furlough. The scope for backdating is unclear.

The backdating to 1 March 2020 seems to be designed to cover those who have already been laid off or made redundant as a result of coronavirus, so if employers re-employ people who were made redundant after 1 March they can furlough those employees and claim the grant.

What if we’ve already made redundancies?

If you have made employees redundant since 28 February, it is possible to give those former employees the option of being rehired and then put straight on the scheme.

Can we make some people redundant and furlough others?

Yes. The guidance clearly says that you do not need to place all your employees on furlough.

How should we select which employees should be furloughed?

Workers who cannot work from home and who currently have no work to do will be obvious candidates for furloughing. Otherwise, employers may need to consider a process of calling for volunteers, pooling and selection – as with a redundancy process. There is a risk of claims (including discrimination claims) if the process is not handled correctly.

Can we do a partial furlough to put somebody on reduced hours?

No. An individual cannot work for you at all if they are furloughed.

If you have some work for an individual, but not enough, you can still have a discussion with them about going down to a reduced working week. They will need to agree to this, except in the unlikely event you have reserved the right to put them on reduced pay for reduced work, and they will not be on the furlough scheme. 

What is the process for claiming the payment?

You will need to submit information to HMRC about workers who have been furloughed and their earnings, via a new HMRC online portal. The portal will hopefully be open in April. If you need short-term cash flow support in the meantime, the government has said you may be eligible for a Coronavirus Business Interruption Loan.

What about casual workers and workers on zero-hours contracts?

The scheme will cover workers on the PAYE system, including any casual or zero-hours worker who are paid in that way. For workers whose pay varies, you can claim for the higher of either:

  • the same month’s earning from the previous year
  • average monthly earnings from the 2019-20 year

If the worker has been employed for less than a year, you can claim for an average of their monthly earnings since they started work. If the worker only started in February 2020, you should use a pro-rata approach.

What about agency workers?

Agency workers on PAYE can be furloughed by the agency, so long as they are not doing any work.

Can workers be in the furlough scheme if they are off sick?

The guidance says that “employees on sick leave or self-isolating should get Statutory Sick Pay but can be furloughed after this”. This suggests that you cannot put an employee on furlough until they have come off sick leave, which is surprising.

The guidance does not deal explicitly with employees who become sick while on furlough, although it does say that employees will retain their entitlements to SSP. Since SSP is likely to be lower than furlough pay, they will however have no incentive to declare themselves sick.

Employers will need to decide what to do about company sick pay. It may be best to agree that company sick pay is suspended.

What about employees on maternity or other family leave?

The guidance says that employers can claim for enhanced maternity pay through the furlough scheme. This suggests that employees can furlough employees on maternity leave. They will be able to reclaim SMP in the normal way and subject to the normal rules and can then claim for any enhanced contractual pay on top through the furlough scheme.

Currently, employers can reclaim 92% of SMP (or 103% of they qualify for Small Employers’ Relief). It is unclear if employers can claim the 8% balance of SMP through the scheme, along with enhanced contractual pay. 

The same principles apply to other types of family leave (according to the employee guidance).

Will workers continue to accrue holiday allowance while they are furloughed?

Yes, because they remain employed. You could agree that no contractual holiday (beyond the statutory minimum of 5.6 weeks per year) will accrue during furlough, but employees will retain their right to accrue annual leave under the Working Time Regulations.

Can people take their holiday allowance while furloughed?

This is not entirely clear. You could refuse requests for holiday during furlough if you want to do so, but you might prefer employees to use up their holiday allowance rather than storing it up and we currently expect this to be possible under the scheme although we cannot say for certain. To require employees to take holidays (if this is going to be allowed), you would need to give twice as much notice as the length of the holiday you want them to take (e.g. ten days’ notice for five days’ holiday) unless the contract says something else.

What should we pay staff who take holiday during furlough?

This is a complicated question on which we suggest you take advice. We expect that you will be able to claim for holiday pay through the grant, in the same way as wages or salary, although the guidance is not as clear as it should be on this point.

Will employees continue to accrue continuous service during furlough?

Yes, the underlying relationship will continue if a worker is furloughed, so their period of continuous employment will continue to accrue throughout and will be recognised in full once the furlough comes to an end.

What happens at the end of the furlough?

The idea is that employees will be able to come back to work. The scheme is designed so that employers don’t need to make redundancies and then recruit a new workforce once the crisis is over – their existing workforce will be ready and waiting in the wings to resume work.

However, if trading conditions have not improved sufficiently for you to take all the furloughed employees back when the scheme ends then you will be able to make them redundant, subject to the usual rules on redundancy.

This is significant because other European countries that have similar schemes in place are imposing restrictions on employers making redundancies. No such conditions are being imposed in the UK, however.

Are foreign nationals with visas eligible for the furlough scheme?

We have seen nothing to suggest otherwise. We believe it will cover all workers so long as they are UK workers on UK contracts, working in the UK and paying UK PAYE. There are potential sponsor compliance issues to consider for Tier 2 workers, and while foreign nationals with limited leave are in most cases not entitled to receive public funds, accessing funds through the furlough scheme is not currently prohibited.

Help announced for coronavirus-hit self employed

Self-employed and freelance workers finally received news of the government’s coronavirus support package on Thursday evening, but the Chancellor’s much-mooted bailout is set to make them wait until the beginning of June for the pay out.

Telling self-employed workers that “you have not been forgotten”, Rishi Sunak’s third appearance at the daily Downing Street press briefing focused on new support for this, until now, overlooked part of the UK workforce affected by the coronavirus crisis.

“I know that many self-employed people are deeply anxious about the support available for them… To you, I say this: You have not been forgotten. We will not let you behind. We are all in this together,” said Sunak.

Sunak’s biggest lifeline to struggling self-employed was a new self-employed income support scheme that treats these workers with the same parity as furloughed employees, under the coronavirus jobs retention scheme.  

The new scheme will pay those “who make the majority of their income from self employment” 80% of average monthly profits for the last three years up to a maximum of £2,500.

Sunak confirmed that the scheme will be open for “at least three months” but as he has done with other COVID-19 measures, he has the option to extend it if necessary.

The scheme will will have an earnings cap of £50,000 and cover 95% of self-employed workers, the Chancellor said.

In order for self employed workers to qualify for this scheme, Sunak said they must have filed a 2018/19 SA return. The government added this condition to minimise fraud, but the Chancellor admitted that they’re designing these schemes at pace and “shouldn’t let perfect be the enemy of good”.  

People who started trading in 2019/20 would need to “look at the extra support in the welfare system”, Sunak advised.

The Chancellor added that anyone who missed the 31 January SA deadline had four weeks from today to submit their tax return in order to meet scheme’s requirements.

How can access UK businesses use the Job Retention Scheme (JRS) to continue paying 80% of the salary for employees that would otherwise have been laid off or made redundant, the practical next steps and potential complications of the scheme.

Key points include:

  • Furloughed workers should not undertake any work for the company, including answering calls or emails
  • JRS should not interrupt an employees’ continuity of service
  • Annual leave will continue to accrue
  • No PAYE tax/ or national insurance contributions are due
  • The grant is a reimbursement by HMRC so businesses may face cash flow issues
  • Changing the status of employees remains subject to existing employment law and may be subject to negotiation

The terms

The Job Retention Scheme is a huge incentive for companies to keep employees on payroll. To access the support companies need to classify employees as a furloughed worker, which means they should not undertake any work for the company while furloughed, including answering calls or emails.

In exchange employers can claim a grant of up to 80% of each employee’s wage for all employment costs, up to a cap of £2,500 per month.

The employee remains employed and their employer can choose to fund the difference between this payment and their usual salary, but it’s not compulsory. Assuming notice hasn’t yet been served on ‘at risk’ employees, and even if it has, employers should discuss the JRS with them as part of any consultation process and agree to either carry on with the redundancy process, or agree to use the JRS as an alternative.

Should the business decide, at a later point, that redundancies are still necessary, they should take legal advice at that stage on the associated risks.

We don’t yet know whether employees will be restricted from taking on other/new work while receiving a salary under the scheme, but government advice is being updated on a daily basis. It’s likely that the JRS will not interrupt an employees’ continuity of service.  Likewise, annual leave will continue to accrue while staff remain employed.

The grant is a reimbursement by HMRC of salary costs paid to furloughed workers, so businesses may face cash flow issues in paying these workers. A number of options may be open to businesses, including the Government’s Coronavirus Business Interruption Loan.

JRS is intended to run for at least three months from 1 March 2020, but it will be extended if necessary. The JRS will cover the cost of wages backdated to 1 March 2020 and will be open before the end of April. It is open for workers who were in employment on 28 February.

Putting the scheme into practice

We anticipate furloughed employees will be deemed as taking a leave of absence. On that basis, they would strictly be unpaid. The government needs to structure the grant so it isn’t ‘pay’, and therefore no PAYE tax or national insurance contributions (NIC) are due, and no benefits driven from pay are applicable.

It’s normal practice in countries such as the US, that already have the status of furloughed worker, for benefits like health and life cover to continue while an employee is furloughed. However, in our view the JRS should be implemented in such a way that these do not impact on the flow of the 80% from the government via the employer to the employees.

There could be further complications, for example where the employee pays for additional private medical cover as part of an employee benefits scheme.

We also await details on how the JRS will apply to employees within personal service companies (PSCs). We anticipate that PSCs will be eligible in the same way as other businesses and subject to the same expected rules on the reference salary for the 80% calculation.

Eligibility and accessing the JRS

All UK businesses are eligible as long as they:

  • Designate affected employees as ‘furloughed workers’
  • Notify those employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
  • Submit information to HMRC about the employees that have been furloughed and their earnings. This will be through a new online portal – HMRC will set out further details on the information required.

How businesses should prepare – the financials

  • Set up the payroll with a furloughed pay element to identify the amounts for reclaim
  • Calculate furloughed pay based on the 12 weeks up to the end of February. Use regular basic pay but not overtime or bonuses. Please note: This is our estimate of the likely period for assessment – details still to be confirmed by the Government.
  • For employees off sick during that 12 weeks, base furloughed pay on the amounts excluding sick pay
  • Assume this is still pay and that PAYE tax and NIC deductions will be due, albeit that  payments to HMRC are likely to be deferred
  • This is a grant that reimburses the business, so cash flow could still be an issue. A bank facility or loan may be required to fund these payments prior to reimbursement.

Practical step by step process

  1. Identify those employees ‘at risk’ and earmarked for lay-off
  2. Analyse pay from the last 12 weeks up to the end of February (estimated timeframe, government still to confirm)
  3. Establish base pay that qualifies for 80% furloughed grant
  4. Identify employees where £2,500 cap will apply
  5. Calculate additional pay required to get to ‘normal’ pay
  6. Model options to manage any top up outside of the grant
  7. Identify employees required to remain in employment
  8. Model options to flex remuneration for those employees not furloughed, including establishing new ‘base’ pay in line with national minimum wage and employment related loans
  9. Commence communication with all affected employees including illustrations of proposed payments
  10. Obtain employee/union buy-in
  11. Implement changes to payroll and pay elements
  12. Prepare application to HMRC
  13. Register and log-on to new HMRC portal (timing TBC)
  14. Submit required information to HMRC
  15. Receive reimbursement via new system

Additional considerations

When are employees entitled to SSP?

  • If an employee is displaying coronavirus symptoms, they should stay home and will be eligible for SSP; this will be for the whole 14 days and not from the fourth day onwards as is usually the case for SSP
  • If an employee is in a vulnerable group, has returned from high risk country or been in contact with a confirmed case or person displaying symptoms, they should stay home or be sent home and will also be entitled to SSP
  • If an employee is in the same household as someone who is displaying symptoms, they should stay home for 14 days and will be entitled to SSP
  • If an employee chooses to self-isolate and does not fall into any of the above categories, the employer does not have to pay them as this is a personal decision the employee is making
  • If an employee is not displaying symptoms, in a vulnerable group, or living with someone displaying symptoms but is told to go home or not come in, for example because the whole business is shutting temporarily, they are entitled to full pay unless the employer has a short time working/lay off clause in their contracts, as this is a business decision the employer is making

What happens if we have to close the business?

If the employer shuts the business and tells staff who are ready and able to work not to come into work, it is the employer that is not providing work for them. The employer would have to continue to pay them in full pay unless there is a shortage of work/lay off clause in their contracts and the employees have signed their contracts.

Enforcing use of holiday entitlement

Businesses are permitted to require employees to take any paid holiday entitlement they have, but must give notice of twice the length of the period of holiday they are being required to take.

COVID-19: guidance for employees

Staying at home

If you have symptoms of coronavirus infection (COVID-19), however mild, stay at home and do not leave your house for 7 days from when your symptoms started.

If you live with others and you are the first in the household to have symptoms of coronavirus, then you must stay at home for 7 days, but all other household members who remain well must stay at home and not leave the house for 14 days. The 14-day period starts from the day when the first person in the house became ill.

See the stay at home guidance for more information.

Sick pay

You can get £94.25 per week Statutory Sick Pay (SSP) if you’re too ill to work. It’s paid by your employer for up to 28 weeks.

If you are staying at home because of COVID-19 you can now claim SSP. This includes individuals who are caring for people in the same household and therefore have been advised to do a household quarantine.

To check your sick pay entitlement, you should talk to your employer, and visit the Statutory Sick Pay (SSP) page for more information.

SSP start date

We are legislating for SSP to be paid from day 1, rather than day 4, of your absence from work if you are absent from work due to sickness or need to stay at home due to COVID-19. Once the legislation has been passed, this will apply retrospectively from 13 March. You should talk to your employer if you are eligible for SSP and need to claim.

Proof of sickness

If you have COVID-19 or are advised to stay at home, you can get an ‘isolation note’ by visiting NHS 111 online, rather than visiting a doctor. For COVID-19 cases this replaces the usual need to provide a ‘fit note’ (sometimes called a ‘sick note’) after 7 days of sickness absence.

Isolation notes will also be accepted by Jobcentre Plus as evidence of your inability to attend.

If you’re self-employed or not eligible for SSP

If you are not eligible for SSP – for example if you are self-employed or earning below the Lower Earnings Limit of £118 per week – and you have COVID-19 or are advised to stay at home, you can now more easily make a claim for Universal Credit or new style Employment and Support Allowance.

If you are eligible for new style Employment and Support Allowance, it will now be payable from day 1 of sickness, rather than day 8, if you have COVID-19 or are advised to stay at home.

Furloughed workers

If your employer cannot cover staff costs due to COVID-19, they may be able to access support to continue paying part of your wage, to avoid redundancies.

If your employer intends to access the Coronavirus Job Retention Scheme, they will discuss with you becoming classified as a furloughed worker. This would mean that you are kept on your employer’s payroll, rather than being laid off.

To qualify for this scheme, you should not undertake work for them while you are furloughed. This will allow your employer to claim a grant of up to 80% of your wage for all employment costs, up to a cap of £2,500 per month.

You will remain employed while furloughed. Your employer could choose to fund the differences between this payment and your salary, but does not have to.

If your salary is reduced as a result of these changes, you may be eligible for support through the welfare system, including Universal Credit.

We intend for the Coronavirus Job Retention Scheme to run for at least 3 months from 1 March 2020, but will extend if necessary.

Claiming benefits

Whether you are currently in or out of work, if you are on a low income and affected by the economic impacts of COVID-19, you will be able to access the full range of the welfare system, including Universal Credit.

From 6 April we are increasing the standard allowance in Universal Credit and the basic element in Working Tax Credit for 1 year. Both will increase by £20 per week on top of planned annual uprating. This will apply to all new and existing Universal Credit claimants and to existing Working Tax Credit claimants.

If you have COVID-19 or are staying at home

You are now able to claim Universal Credit, and if required can access advance payments upfront without needing to attend a jobcentre.

If you are self-employed

You are able to claim Universal Credit, providing you meet the usual eligibility criteria.

To support you with the economic impact of the outbreak, and allow you to follow government guidance on self-isolation and social distancing, from 6 April the requirements of the Minimum Income Floor will be temporarily relaxed. This change will apply to all Universal Credit claimants and will last for the duration of the outbreak.

New claimants will not need to attend the jobcentre to demonstrate gainful self-employment.

Support for rent costs

You should check your eligibility for Universal Credit, which is available for people in and out of work. Support for rental costs will be paid through Universal Credit.

From April, we are increasing Local Housing Allowance rates to the 30th percentile of market rents. This applies to all private renters who are new or existing Universal Credit housing element claimants and to existing Housing Benefit claimants.

Tax helpline to support businesses affected by Coronavirus (COVID-19)

New HMRC helpline launched to help businesses concerned about paying their tax due to coronavirus (COVID-19).

HMRC has a set up a phone helpline to support businesses and self-employed people concerned about not being able to pay their tax due to coronavirus (COVID-19).

The helpline allows any business or self-employed individual who is concerned about paying their tax due to coronavirus to get practical help and advice. Up to 2,000 experienced call handlers are available to support businesses and individuals when needed.

If you run a business or are self-employed and are concerned about paying your tax due to coronavirus, you can call HMRC’s helpline for help and advice: 0800 0159 559.

For those who are unable to pay due to coronavirus, HMRC will discuss your specific circumstances to explore:

  • agreeing an instalment arrangement
  • suspending debt collection proceedings
  • cancelling penalties and interest where you have administrative difficulties contacting or paying HMRC immediately

The helpline number is 0800 0159 559 – and is an addition to other HMRC phone contact numbers.

Opening hours are Monday to Friday 8am to 8pm, and Saturday 8am to 4pm. The helpline will not be available on Bank Holidays.


Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim as long as all other terms and conditions are met.

Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.

Support for businesses paying tax: Time to Pay service

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.


You are eligible if your business:

  • pays tax to the UK government
  • has outstanding tax liabilities

How to access the scheme

If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.

If you’re worried about a future payment, please call us nearer the time.