Taxation of UK Coronavirus Support Payments
There is new draft UK legislation for addition to FA 2020 for the taxation of coronavirus support payments:
It applies to individuals, businesses, partnership members, and employers. The legislation confirms the taxability to Income Tax or Corporation Tax of all such receipts subject to business profits on normal principles.
The legislation also provides for Income Tax assessments at 100% of any amount to which the recipient was not entitled and gives HMRC the power to levy penalties upon any deliberately incorrect claims – subject to a 30-day self-reporting window. Furthermore, the legislation will make culpable company officers jointly and severally liable to Income Tax for deliberate false claims where the company could not pay the assessment.
What they giveth with one hand…