The CIOT’s formal response to the consultation on the draft coronavirus support payments legislation (which closed on 12 June) highlights several concerns:
the 30-day deadline for taxpayers to notify HMRC that they were not entitled to an amount received seems short, particularly where an individual was not aware they had received a payment to which they were not entitled;
some cases where individuals were not entitled, or were unaware of the requirement to notify an overpayment, will only come to light after a longer period and HMRC should therefore take a ‘proportionate and targeted approach in their compliance activity in the months ahead’;
the legislation appears to give HMRC the power to issue penalties in cases not involving deliberate behaviour; clear guidance on the application of penalties and the interaction with the existing penalty regimes, e.g. penalties for inaccuracies (FA 2007 Sch 24) and for failure to notify (FA 2008 Sch 41), is essential;
official guidance on the support schemes has been continually updated, making it difficult to keep up with the changes (for example, adding new examples to what is meant by ‘adversely affected’ for the purposes of eligibility for SEISS payments – see below) meaning that individuals may have made claims on the understanding that they were eligible at the time, but later need to notify an overpayment as the position becomes clearer.
The CIOT has asked HMRC to ensure that the practicalities of how the legislation will operate are made public ‘as a matter of urgency’ particularly in light of the 30-day notification deadline, to ensure taxpayers and advisers can plan accordingly.
The CIOT’s formal response to the consultation on the draft coronavirus support payments legislation (which closed on 12 June) highlights several concerns:
the 30-day deadline for taxpayers to notify HMRC that they were not entitled to an amount received seems short, particularly where an individual was not aware they had received a payment to which they were not entitled;
some cases where individuals were not entitled, or were unaware of the requirement to notify an overpayment, will only come to light after a longer period and HMRC should therefore take a ‘proportionate and targeted approach in their compliance activity in the months ahead’;
the legislation appears to give HMRC the power to issue penalties in cases not involving deliberate behaviour; clear guidance on the application of penalties and the interaction with the existing penalty regimes, e.g. penalties for inaccuracies (FA 2007 Sch 24) and for failure to notify (FA 2008 Sch 41), is essential;
official guidance on the support schemes has been continually updated, making it difficult to keep up with the changes (for example, adding new examples to what is meant by ‘adversely affected’ for the purposes of eligibility for SEISS payments – see below) meaning that individuals may have made claims on the understanding that they were eligible at the time, but later need to notify an overpayment as the position becomes clearer.
The CIOT has asked HMRC to ensure that the practicalities of how the legislation will operate are made public ‘as a matter of urgency’ particularly in light of the 30-day notification deadline, to ensure taxpayers and advisers can plan accordingly.
