What emergency legislation, relief programmes and other initiatives specific to your practice area has your state implemented to address the pandemic? Have any existing government programmes, laws or regulations been amended to address these concerns? What best practices are advisable for clients?
Please note that the list below includes significant covid-19-related measures relevant to high net worth individuals and introduced in the period between March 2020 and October 2020. While we have endeavoured to include all measures of significance, this list is not exhaustive.
UK Immigration
Visitors or those wishing to come to the UK to live, work or study for more than 6 months have faced significant travel disuption due to covid-19. In response, the UK government implemented a number of concessions to address any adverse UK immigration consequences caused by the pandemic. These measures have evolved with the ever-changing nature of the virus. As at the time of publication, the current key concessions can be summarised as follows:
- Those with visas that expired between 24 January 2020 and 31 July 2020 were able to request for their leave in the UK to be extended if they were prevented from returning to their home country for reasons relating to covid-19. This concession was subsequently extended to those whose leave expired before 31 August 2020. Individuals whose leave expired between 1 September 2020 and 31 October 2020 may apply for an 'exceptional assurance' from the UK Home Office's dedicated Coronavirus Immigration Team to remain in the UK. In all cases, such concessions result in the individuals not breaching the Immigration Rules by overstaying.
- Visitors or those on short-term visas unable to leave the UK could apply for long-term visas from within the country (rather than return to their home country to do so as required under normal circumstances) if their leave in the UK expires after 31 August 2020 and they are able to demonstrate an urgent need for the application.
- Successful applicants of long-term visas from outside the UK whose 30-day travel vignette stamped in their passport expired before they were able to travel to the UK can request a replacement vignette with revised validity dates free of charge. This is only available until 31 December 2020.
Individuals with long-term UK visas prevented from returning to the UK may have exceeded 180-days absences in a 12-month period and therefore unable to satisfy the residence requirement for settlement. A general exception to this requirement exists to disregard absences due to 'exceptional circumstances', which includes a 'natural disaster'. The Home Office has not confirmed if the pandemic falls within this definition but it is expected to. Therefore, UK absences caused by travel restrictions and border closures due to covid-19 are considered to be 'exceptional circumstances' and the Home Office's published guidance that an individual's UK immigration status will not be negatively affected by the pandemic supports this.
Statutory Residence Test: temporary workers in the UK for covid-19-related activities
In an effort to attract and retain those with expertise in fields that may help in fighting covid-19 in the UK, the Chancellor announced in April 2020 that the statutory residence test (SRT) would be relaxed for certain individuals for the period 1 March to 1 June 2020 (although the duration of the concessionary period was to be kept under review).
This was legislated in the Finance Act 2020 so that any day that a relevant individual who is resident outside the UK in a relevant tax year spends in the UK in the period 1 March to 1 June (or such longer period as the Chancellor subsequently decides) will not be considered a day of presence in the UK for the purposes of the SRT. This concession applies provided that the individual was present in the UK for an 'applicable reason' related to coronavirus, including as a medical or healthcare professional working in this field, or for purposes connected with the development or production of medicinal products (including vaccines), devices, equipment or facilities related to the detection, treatment or prevention of coronavirus. To date, there has been no extension of the initial period.
HMRC relaxes the public access requirements for the Conditional Exemption
HMRC temporarily relaxed the public access requirement for the IHT Conditional Exemption, and urged the owners of heritage property to follow the restrictions imposed by the UK government on business operation and public movement due to the Coronavirus outbreak. It indicated that it would expect property owners to re-open for public access once restrictions were lifted.
Higher rate SDLT for additional properties: Exceptional circumstances preventing disposal of interest in a main residence within three year period
In Finance Act 2020, the government introduced an extension to the three-year time limit in which to dispose of a previous main residence, and so qualify for a refund of the three per cent higher rate tax paid on acquisition of a second home, where exceptional circumstances that could not reasonably have been foreseen prevent the sale of the previous main residence within that period.
This temporary change only applies where the three-year time limit to sell the previous main residence ended on or after 1 January 2020.
While covid-19 is not specifically mentioned in the legislation, HMRC's statement at the time the proposed concession was announced made clear that it was the impact of coronavirus on the residential property market that was the principal driver for this change.
Temporary permission for virtual execution of wills
A temporary rule came into effect on 28 September 2020, permitting wills executed between 31 January 2020 and at least 31 January 2022 to be witnessed virtually, where it is not possible to do so in person. This rule was introduced in recognition of the difficulties presented by social distancing and other rules for executing wills during the covid-19 pandemic.
HMRC relaxes appeals deadlines and 'reasonable excuse' test
In May 2020, HMRC announced that taxpayers would be allowed an extra three months to appeal HMRC’s decisions or penalties, where they were unable to meet the usual 30-day deadline because of the covid-19 pandemic. Delayed appeals would be accepted against decisions or penalties dated as far back as February 2020. HMRC also updated its general guidance on applying the 'reasonable excuse' test where the pandemic affected a taxpayer's ability to meet their obligations, including financial institutions' information exchange duties under the International Tax Enforcement (Disclosable Arrangements) Regulations 2020.
Daily late filing penalties waived for 2018/19 self assessment
In October 2020, HMRC confirmed it would not impose daily penalties on taxpayers who were more than three months late in filing their 2018/19 self assessment tax returns due to the covid-19 pandemic. However, the £100 fixed penalty for missing the deadline will be charged, as will the six-month and 12-month late-filing penalties, where appropriate.
New registration of death requirements under Coronavirus Act 2020
The Coronavirus Act provides new requirements for registering a death, including how to provide information other than in person and dispensing with the signing of the register. The practicalities of registering a death in relation to the delivery of documents by alternative methods are also covered.
England & Wales Guide
The England & Wales guide answers the principal questions for Private Clients relating to the law in this jurisdiction.
