24/03/2020
Our main priority at present is to ensure that all of our clients are supported through these challenging times, with the Covid-19 virus taking hold and we are here to talk to you should you have any queries. Following recent Government announcements for support to businesses the following will be made available:
Job Retention Scheme
The Government will pay 80% of wages for staff who lose jobs in this crisis but whose employers want to keep them in the long term. We believe that this will be based on the earning for the 12 weeks prior to 29th February 2020 made through PAYE and is capped at £2,500/month. At present none of this has been clarified in any great detail or the legislation issued.
We believe this will be funded by HMRC grants and can be backdated to 1st March 2020. Currently there are plans to offer this scheme for a period of three months, but could well be extended depending on how long this situation lasts for.
To qualify for this grant the employer will need to discuss with the employees effected that they are going to be reclassified as a furloughed worker, meaning that they are kept on the payroll, rather than being made redundant. The condition of this means the employee should not undertake any work for the employer while they are furloughed. You will remain employed while furloughed and the employer can choose to fund the difference between the 80% payment and the normal salary, but does not have to.
Coronavirus Business Interruption Loan Scheme
A £330 billion low interest loan scheme starting Monday 23rd March 2020 will be available to businesses to assist with keeping their business afloat, with the Government paying all interest for the first twelve months. Loans of up to £5 million pounds will be available.
To qualify you must be a UK based company, with a turnover of no more than £41 million pounds per year, operate within an eligible industrial sector, as a small number of industrial sectors are not eligible for support. In addition, you must be able to confirm that they have not received de minimis State aid beyond €200,000 equivalent over the current and previous two financial years and more importantly have a sound borrowing proposal, but sufficient security to meet the lender’s requirements.
Self Assessment Deferral
Individuals have the option to defer their 31st July 2020 second payment on account until the 31st January 2021 and should ring the HMRC payment helpline to take advantage of this.
VAT Deferral
Businesses and individuals have the option to defer their VAT payments for any VAT Quarter falling between 20th March 2020 to 30th June 2020 to assist with cashflow.
This is an automatic offer with no applications required to HMRC. Businesses will not need to make a VAT payment during this period and taxpayers will be given until the end of the 2020/21 tax year (31st March 2021) to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.
Self Employed
Self employed persons will be able to access Universal credit payments in full equivalent to statutory sick pay eligible to employees of £94.25 per week. However, further measures are due to be announced in the coming days.
Businesses Paying Sick Pay
Businesses and employers should be able to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. This refund will cover up to 2 weeks of SSP for eligible employee who have been off work as a result of COVID-19.
Business Grant Scheme Funding
A Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief, rural rate relief and tapered relief is available to some businesses and dependable on the rateable value of the premises.
To those that will be eligible this will provide a one-off grant of £10,000 to help meet ongoing business costs and your local council will write to you to tell you whether you are eligible to this grant.
There will also be a 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England and businesses in these specific sectors could also potentially benefit from grant funding of £25,000 if their property has a rateable value of between £15,000 and £51,000.
