HMRC has met its deadline to deliver the portal for Coronavirus Job Retention Scheme claims, opening the way for millions of people to receive support for their salaries.
The CJRS portal was designed in just 48 hours, was delivered in around four weeks and is capable of handling over 400,000 visitors at a time.
“Against a backcloth of the history of Government IT projects, the fact that the portal is operational and is working at scale is impressive, and shows the Government has taken a radical approach,” said John Thornton, AAT President.
“We have had no problems so far. The speed of delivery is unprecedented. It’s a wonderful achievement by HMRC. Hopefully, they can maintain that momentum post-coronavirus,” said David Fredericks AAT Vice President.
However, despite the successful launch, there are still questions around the scope of the job retention scheme and other Government support measures.
Accountancy firms lobby the Government
Concerns that some individuals and companies are being left behind has led 250 accountancy firms, including a number of AAT Licensed Accountants, to put their name to an open letter to the Government.
The letter was organised by Countingup, a business banking app for small businesses, and requesting that the government does more to help small businesses survive the impact of Covid-19.
Representing over 70,000 small businesses and 250 accountancy firms, Tim Fouracre, Countingup’s CEO explains that the letter was written at this time because accountants are being inundated with queries from their small business clients.
Two main have themes have been identified:
- Support those businesses left behind by the Coronavirus Job Retention Scheme (JRS) and Self-Employment Income Support Scheme (SEISS).
- Provide more clarity on the process and timings of JRS and SEISS grants.
Within the letter, concerns are raised that the CJRS and SEISS do not go far enough to ensure the survival of the many small businesses that are not eligible. For those who are eligible, the process and timetable for the JRS and SEISS are unclear and put’s these businesses at risk.
Those not eligible for CJRS and SEISS grants
- Directors on dividends – small businesses with directors remunerated primarily through dividends. 71% of our respondent accountants raised concerns over this group
- Newly self-employed sole traders who set up after 6 April 2019
- Self-employed sole traders who historically had tradable profits of over £50,000
Fouracre commented “with the Coronavirus Job Retention Scheme there is still a massive gap for limited companies with directors who remunerate themselves with dividends. They are not eligible for CJRS but are adversely impacted by the pandemic in the same way as any other business. The government needs to help these businesses out urgently”.
In a recent survey of its accountant customers, 71% said they were concerned about small business owners who paid themselves through dividends.
One potential solution in regards to the directors of limited companies paid through dividends would be to allow dividends paid to directors of limited companies to count in the same way as a salary says Fouracre.
More clarity on process and timings of grants
- Cash flow – Many businesses face immediate collapse and more urgency is needed to award grants earlier
- Eligibility – Clearer information to be given to small businesses around how to claim and who is eligible. 59% of respondent accountants raised concerns over this
- Trading profits – Clarity on the definition of “trading profits” used in the SEISS. Is it box 23 or box 28 of the SA103(short) or something else
Fouracre said “help has started to come through and we’re fully supportive of the CJRS launch. From what we’ve heard from our accountant partners the process for applying has been relatively painless, which is great news. Now we need to see the SEIS grants launched because sole traders are still waiting for the cash they urgently need”.
“We welcome the government support that’s being made available to sole traders and limited companies. We simply appeal for it to be provided equitably across the range of small businesses represented in the UK” Fouracre concluded.
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Hannah Dolan is AAT Comment’s Content Editor.