HMRC have released guidance in respect of making repayments of sums received through the Eat Out to Help Out scheme.

Where businesses have received money via the Eat Out to Help Out scheme it may be necessary to repay HMRC where: 

  • HMRC advise that too much has been claimed.
  • The business identifies an error in their claim or was not eligible to make a claim. 

Repayments can also be made voluntarily. 

HMRC have a statutory power to recover amounts overclaimed. They are seeking to tackle deliberate non-compliance and criminal attacks and are not actively looking for innocent errors in their compliance approach. 

HMRC may charge a penalty if they are not informed within the notification period that a business is chargeable to tax on an overclaimed Eat Out to Help Out payment. 

  • HMRC will take account of whether the business knew it was not entitled to the payment when it was received. 
  • The maximum penalty chargeable is 100% of the overpayment, in cases that are Deliberate and concealed. 
  • HMRC will not charge a penalty if the business did not know it had overclaimed an Eat Out to Help Out payment at the time it was received and it is paid back within the notification period. 

Where a business identifies that an Eat Out to Help Out payment has been overclaimed and not repaid, HMRC must be notified within the 'notification period'. 

  • Depending on the situation, the notification period ends 90 days after receipt of the Eat Out to Help Out payment that the business was not entitled to. 

To recover overclaimed payments, HMRC can make a tax assessment in writing. 

  • Amounts assessed must be paid within 30 days of the assessment. 
    • Interest will be charged on late payment. 
    • Late payment penalties may be charged if the amount is not paid 31 days after the due date. 
  • Assessments may be appealed within 30 days. 
  • Where a partnership overclaims an Eat Out to Help Out payment which is not repaid, HMRC can assess any of the partners, who will be jointly and severally liable. 
    • If the partnership does not repay the amount and HMRC have not issued an assessment, one of the partners must include the Income Tax charge on their Self Assessment tax return for 2020-21. The other partners will not need to self-assess the amount.
  • If HMRC have not made an assessment, details of the overclaimed Eat Out to Help Out payment must be included on either: 
    • The appropriate Corporation Tax return, or
    • The taxpayer's Self Assessment tax return for 2020-21.

Links

2019/20 Self Assessment Tax Return toolkit
A summary of what’s changed since 2018/19 and top tips for 2019/20 tax return completion. 

Eat out to help out
In his Summer Economic Update, as part of the ongoing government support during the COVID-19 crisis, the Chancellor announced a new Eat Out to Help Out Scheme for restaurants.

External links 

HMRC guidance: Repay Eat Out to Help Out Scheme payments

HMRC policy paper: 'Eat Out to Help Out Scheme: receiving payments you were not entitled to'

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