Last updated: 27 March 2020
Here’s our summary of what help is available for businesses affected by the Coronavirus
Self Employed Income Support Scheme
The latest Government details are listed here.
We’ve produced our FAQ’s here
Please be vigilant for possible fraud. Scammers will use this uncertainty try to obtain bank details.
If in doubt ask us.
Cash flow spreadsheet
We strongly advise preparing a cashflow to cover the next 12 weeks.
Download a copy here
Make sure you save a copy locally (Use File/Save As) and don’t just edit this version or we’ll all see your business!!
Coronavirus Job Retention Scheme
The latest Government guidance is here.
Under the new Coronavirus Job Retention scheme, government grants will cover 80% of the salary of PAYE employees who would otherwise have been laid off during this crisis. The scheme, open to any employer in the country, will cover the cost of wages backdated to 1 March 2020 and will be open before the end of April. It will continue for at least three months, and can include workers who were in employment on 28 February.
To claim under the scheme employers will need to:
– designate affected employees as ‘furloughed workers’, and notify employees of this change. Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and
– submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal. HMRC will set out further details on the information required.
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.
While HMRC is working urgently to set up a system for reimbursement, we understand existing systems are not set up to facilitate payments to employers. Business that need short-term cash flow support, may benefit from the VAT deferral announced below and may also be eligible to apply for a Coronavirus Business Interruption Loan.
The next quarter of VAT payments will be deferred, meaning businesses will not need to make VAT payments until the end of June 2020. Businesses will then have until the end of the 2020-21 tax year to settle any liabilities that have accumulated during the deferral period.
The deferral applies automatically and businesses do not need to apply for it. VAT refunds and reclaims will be paid by the government as normal.
Update: HMRC have confirmed you need to cancel your Direct Debit or it will be collected as normal
July Income Tax payments
Income Tax Self-Assessment payments due on the 31 July 2020 will be deferred until the 31 January 2021. This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.
Update: this originally stated self employed only but now covers all tax payers
The Government has promised a preferential loan scheme to support business through the difficulties.
There are more details here.
The Government has set up a helpline for businesses and the self employed who are concerned about not being able to pay their tax.
There are more details here.
Official guidance for employers
For HMRC’s guidance for employers, please follow the link below:-
Please feel free to access the HR Support line available to our clients. If you require this then please contact us for the details.
Paying sick pay to staff absent through COVID-19
To support businesses experiencing increases in costs or financial disruptions:-
· The government will bring forward legislation to allow small and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
· The eligibility criteria for the scheme will be as follows:-
o This refund will cover up to two weeks’ SSP per eligible employee who has been off work because of COVID-19. Employers with fewer than 250 employees will be eligible.
o The size of an employer will be determined by the number of people they employed as of 28 February 2020. Employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19.
o Employers should maintain records of staff absences, but employees will not need to provide a GP fit note.
o The eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to self-isolators comes into force.
o The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible. Existing systems are not designed to facilitate employer refunds for SSP.
Support for businesses that pay business rates
Government will introduce a business rates retail holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.
A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.
Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday will be published by 20 March.
Support for businesses that pay little or no business rates
The government will provide additional funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR). This will provide a one-off grant of £10,000 to businesses currently eligible for SBRR or rural rate relief, to help meet their ongoing business costs.
If your business is eligible for SBRR or rural rate relief, you will be contacted by your local authority – you do not need to apply.
Funding for the scheme will be provided to local authorities by government in early April. Guidance for local authorities on the scheme will be provided shortly.
Filing Company Accounts
Companies House will consider extending the deadline on a case by case basis. It’s important to agree an extension before the accounts deadline.
More information here.
Help for freelance and self employed
The level of help currently seems to be running behind other business help. Anyone struggling is encouraged to apply for Universal Credit as soon as possible. There is more information here.
Usually asking for a holiday from mortgage payments has a detrimental effect on your credit rating. Banks are confirming this will not be the case for COVID-19. You should contact your own bank to request a payment holiday if one is required.
Delay to IR35
The changes to IR35 for contractors working in the private sector have been delayed by a year.