Coronavirus Business Support Information
We hope you find the below information is useful and we will be updating you as necessary as further details are announced.
As the situation is so fluid, you will appreciate that all of our advice is based on our understanding of the guidance available at the time and of course this may be subject to change as the situation progresses.
In the meantime, can we ask you to bear with us while we address the many calls, emails and messages being received at the moment. Please be assured that we are working hard to get back to you all as soon as we can.
Coronavirus Job Retention Scheme
> HMRC aiming for Scheme to be up and running by end of April – this means it is likely that employees will continue to have to be paid in the interim and then costs reclaimed from HMRC. Business Interruption Loans are available if this will cause difficulties and details can be found here: https://www.businesssupport.gov.uk/coronavirus-business-interruption-loan-scheme/
> Claim for full or part-time employees and those on agency contracts or flexible or zero hours contracts – employees just need to have been on your PAYE payroll scheme as at 28 February 2020.
> Each job treated separately and £2,500 cap applies to each if employee has more than one job – so you don’t need to worry about any other jobs employee may have
> Employer’s NIC’s and auto-enrolment pension contributions will be paid IN ADDITION to the 80% of wage or salary – we will be able to calculate the amounts to pay/reclaim for our payroll clients
> Minimum length of furloughing of 3 weeks – if not provided for in employment contract, you should agree the terms of the furlough with your employee in writing. See ACAS website for further guidance: https://www.acas.org.uk/coronavirus/if-the-employer-needs-to-close-the-workplace
Please click here for HMRC guidance for employers re the Job Retention Scheme:
And here for HMRC guidance for employees:
We have had a lot of calls and enquiries about the position for Company owner/directors, especially those who receive both salary and dividends from their companies.
The Chancellor said in his statement yesterday (Thursday 26th March) that to be eligible for the subsidy, when on furlough, an employee can not undertake work for or on behalf of the organisation. “This includes providing services or generating revenue.”
Our understanding is therefore that Directors may claim under the Job Retention Scheme for 80% of their salary as at 28 February 2020, but they are required to do no work for their company whilst on furlough.
As soon as work re-commences then the furlough ceases and the grant will no longer be able to be claimed, so please let us know when that happens.
This is an area open to interpretation, but it is to be hoped that HMRC will take a pragmatic view as to what would constitute doing work for the company.
There has been a lot of coverage in the press and on social media regarding company directors and the main points to note are as follows:
> Company directors are treated as employees of their company for tax and Covid-19 purposes.
> Company directors fall within the Coronavirus Job Retention Scheme not the Self-Employed Income Support Scheme.
> The Coronavirus Job Retention Scheme only applies to the PAYE salary element of a director’s remuneration. Not to dividends.
> A maximum of 80% of the rate of salary at 28 February 2020 (subject to a maximum of £2,500 per month) can be claimed.
> To claim under the scheme directors must be furloughed which means that they must not do any work for their company (in the same way as other employees who have been furloughed)
> What will be considered to be “work” remains a grey area – there appears to be agreement that legal duties that have to be carried out by a director such as filing returns at Companies House WOULD NOT be considered to be work. Carrying out work for which the company will be paid WOULD be considered to be work. Everything in between, such as basic admin, remains uncertain.
> Whether furloughing will be beneficial depends on what income might otherwise be available if the director continues to work, compared with what he or she would receive under the Job Retention Scheme.
Self-employment Income Support Scheme
As announced yesterday, the new scheme will be operational and first payments made by beginning of June.
You cannot apply for this scheme yet – HMRC will contact you if you are eligible for the scheme and invite you to apply on-line.
Once your on-line application has been received, HMRC will contact you to tell you how much you will get.
Please pass HMRC’s calculations to us for checking once you have received them.
Small Business Grant Funding
Guidance has now been issued to Local Authorities regarding eligibility for the small business grants.
Further details about the grants can be found here: https://www.businesssupport.gov.uk/small-business-grant-funding/
Grants are to be paid automatically by Local Authorities without a claim being necessary, although timescales for payment have not yet become clear.
Cash Grant for Retail, Hospitality and Leisure
As for small business grant funding, guidance has now been issued to Local Authorities regarding eligibility for the grants.
Further information about the grants can be found here:
These grant schemes are being administered by Local Authorities and the advice is that you do not need to make a claim – your Local Authority will contact you.
We are delighted to be able to let you know that Shropshire Council has started contacting businesses and now has the link and application form for the COVID-19 business grants live on their website.
Please click here to access: https://shropshire.gov.uk/covid-19-grants
For further details of grants available to small businesses entitled to Small Business Rates Relief click here: https://www.businesssupport.gov.uk/small-business-grant-funding/
For further details of grants available to businesses in the Retail, Hospitality and Leisure sector click here: https://www.businesssupport.gov.uk/cash-grant-for-retail-hospitality-and-leisure/
Companies House Extended Filing Deadline
From 25th March 2020, businesses will be able to apply for a 3-month extension for filing their accounts.
While companies will still have to apply for the 3-month extension to be granted, those citing issues around COVID-19 will be automatically and immediately granted an extension.
IT IS VITAL TO CLAIM THE EXTENSION BEFORE THE ACCOUNTS FILING DATE AS ACCOUNTS SIMPLY FILED LATE WILL NOT QUALIFY FOR THE PENALTY EXEMPTION.
Please contact us as soon as possible if you wish to claim the extension.
NB: Companies that have already extended their filing deadline, or shortened their accounting reference period, may not be eligible for the extension.
HMRC Business Information Campaign
HMRC have launched their business information campaign with a new business support web page – a one stop shop where you can access information about all of the initiatives announced so far to support businesses affected by Covid-19.
Click here to go to the page:
Here you will find details on Business Interruption Loans; Business Rates Holidays; VAT deferral; cash grants for retail, hospitality and leisure businesses; the Coronavirus Job Retention Scheme; grant funding for small businesses qualifying for small business rates relief or rural rate relief; SSP rebates for employers; Time to Pay arrangements; the Corporate financing facility for larger businesses; business rates holidays for nurseries; VAT deferral and Income Tax deferral for the self-employed.
Income Tax payments
For Income Tax Self-Assessment, payments due on the 31 July 2020 may be deferred until 31 January 2021.
You are eligible if you are due to pay your second self-assessment payment on account on 31 July. You do not need to be self-employed to be eligible for the deferment.
The deferment is optional. If you are still able to pay your second payment on account on 31 July you should do so.
How to access the scheme
This is an automatic offer with no applications required. No penalties or interest for late payment will be charged if you defer payment until January 2021.
If you’re in temporary financial distress because of COVID-19 more help is available from HMRC’s Time to Pay scheme.
Released 26 March 2020
The telephone number for HMRC’s coronavirus (COVID-19) helpline has changed to 0800 024 1222.
Further information on the helpline can be found at https://www.gov.uk/government/news/tax-helpline-to-support-businesses-affected-by-coronavirus-covid-19.
Click the link below to view our current factsheet showing more detailed information regarding the current scheme and guidelines.
Our service to our clients – During the COVID-19 pandemic