09/11/2020

Following the announcement that the Coronavirus Job Retention Scheme (CJRS) has been extended until March, it has been confirmed that the Job Retention Bonus (JRB) has been delayed.

The Job Retention Bonus was originally announced in July and was intended to provide one-off taxable bonus to an employer of £1,000 for each eligible employee that was furloughed but kept continuously employed until 31 January 2021. However, as a result of the CJRS being extended to 31 March 2021, it has been confirmed that a retention incentive will be deployed at the ‘appropriate time’.

We do not currently have any indication on timescales or whether there will be any changes to the scheme. Therefore we anticipate that further guidance will be released in due course.

Check back here for all the latest information.

05/11/2020

As you may expect, the announcement of a second national lockdown has resulted in some further changes to the support measures in place for individuals and businesses. The key points are as follows:

The Coronavirus Job Retention Scheme (CJRS)/ The Job Support Scheme (JSS)

It was previously announced that the Coronavirus Job Retention Scheme (also known as the furlough scheme) would come to an end on 31 October. This was set to be replaced by the new Job Retention Scheme from 1 November onwards. However, following the announcement of a second national lockdown, it was confirmed that the current scheme will remain in place for another month (until 30 November) and the new Job Support Scheme will be introduced on 1 December.

The support provided under the CJRS has been scaled back over the past few months, however this will be increased back to 80% for furloughed employees.

The key points under the scheme are:

• Employees will be paid in full by their employer for any hours worked as normal.
• For any hours not worked, furloughed employees will receive 80% of their current salary, up to a maximum of £2,500.
• As was previously the case, employers are able to top up this amount should they choose to do so.
• Employers will be required to cover the cost of employer national insurance and pension contributions.
• Employees must have been on an RTI submission made to HMRC on or before 30 October 2020 to be eligible.
• The government will announce shortly when claims can be made for November.
• Employers and/or employees do not need to have used the scheme previously to be eligible.

As was previously the case, it is important that employers keep detailed records of an employee’s pay and any hours not worked to make the claim.

The Self Employed Income Support Scheme (SEISS)

It was previously announced that self employed individuals eligible for the SEISS would be entitled to 40% of their average trading profits for the November, December and January. The month of November has now been increased to 80% in line with the furlough scheme.

The key points are:

• The eligibility conditions for the grant are identical to the first two grants paid earlier in the year, although relevant individuals do not necessarily need to have made a claim previously.
• The grant will be paid in one instalment to cover November, December and January.
• The rate at which the grant will be paid is 80% of average trading profits for November and 40% for December and January. This amounts to an average of 55% for the three month period.
• The maximum amount of the grant is £5,160.
• To be eligible, individuals must declare that they intend to continue trading but have currently been impacted by Coronavirus.
• It was announced that claims could be made from 14 December onwards but this has now been moved forward to 30 November.

Business Grants

Businesses required to close in England due to local or national restrictions will be eligible for the following grants:

• For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks;
• For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks;
• For properties with a rateable value of £51k or over grants to be £3,000 per month, or £1,500 per two weeks.

As with the previous lockdown, these grants will be administered by local authorities. Therefore we would advise eligible businesses to review their local authority website for further guidance and details on any application process.

Mortgage Holidays

Finally, it was also announced that the option of agreeing a mortgage payment holiday will no longer end on 31 October as previously announced. Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday. Those who have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.

As always, please do not hesitate to get in touch should you require any further information.

13/07/2020

'Kick-start' the Economy in the wake of the Coronavirus Pandemic

This afternoon, Rishi Sunak announced a series of measures to 'kick-start' the economy in the wake of the Coronavirus pandemic.

A summary of the key announcements include:

• VAT – VAT on food, accommodation and tourism will be cut temporarily from the current rate of 20% to 5%.
• Eat Out To Help Out – Every individual in the UK will be given an 'eat out to help out' discount. Meals at participating restaurants will be 50% off up to £10 per head. This will apply Monday to Wednesday throughout the month of August.
• Stamp Duty Land Tax – Homebuyers will be exempt from paying stamp duty land tax on the first £500,000 of a property price. This is effective immediately and will run until 31 March 2021.
• Job Retention Bonus – Businesses will be paid a £1,000 job retention bonus for each worker that is brought back to work and remains employed until 31 January 2021.
• Kickstart Scheme – A new £2 billion scheme has been unveiled to subsidise jobs for unemployed young people. Employers will be able to offer six month placements for 16 to 24 year olds and the government will reimburse 100% of the National Minimum Wage up to 25 hours per week. Employers will be able to top up the worker's pay and receive a £1,000 admin fee.
• Apprenticeships and Traineeships – Businesses will be offered up to £2,000 for every new apprentice and £1,000 to take on new trainees.
• Green Investment – Homeowners will be provided with £5,000 vouchers to make their homes more environmentally friendly. The vouchers will be increased to £10,000 for some of the poorest families.

We expect further details for each announcement to be released shortly.  

11/06/2020

Changes to the Coronavirus Job Retention Scheme (CJRS) and Self Employed Income Support Scheme

The chancellor Rishi Sunak confirmed some changes to both the Coronavirus Job Retention Scheme (CJRS) (also referred to as the Furlough Scheme) and the Self Employed Income Support Scheme.

Coronavirus Job Retention Scheme/Furlough Scheme

As expected, it was confirmed that the scheme 'cannot continue indefinitely' and employers will be required to start contributing to the cost from 1 August.  To ease the burden on employers, there will be a staggered withdrawal:

• 1 August - employers will continue to receive a grant of 80% (subject to the previous maximum limits).  However, they will be expected to cover pension and National Insurance costs from this date.
• 1 September – the grant received by employers will be reduced from 80% down to 70%, subject to a new maximum limit of £2,190.
• 1 October – the grant received by employers will be reduced further down to 60%, subject to a new maximum limit of £1,875.

The scheme will close from the end of October.

Throughout the full period to the end of October, employees will remain entitled to at least 80% of their usual wage (subject to the maximum limits).

It was previously announced that the scheme would be more flexible from 1 August to enable employees to return to work part-time.  This change will now be implemented a month earlier from 1 July.  From this date, employees can work on a part time basis and will be paid in full by an employer for the days worked, with the remaining days still covered by the furlough scheme.

In order to make this change, employers will be unable to furlough any further employees from 10 June.

Self Employed Income Support Scheme

It was also confirmed that the Self Employed Income Support Scheme would be extended for a further three months.  In August, qualifying individuals will be able to make a claim for a further grant covering the three months from 1 June to 31 August.

As was previously the case, the grant will be paid in a single lump sum based on previous average profits but at a rate of 70% (subject to a maximum total grant of £6,570).

Detailed guidance will no doubt follow in due course.

07/04/2020

Business Rates Holiday and Grants

As part of the coronavirus support package for businesses, the chancellor announced a number of different business rates reliefs and/or cash grants.  

The measures are:

• A business rates holiday for businesses operating in the retail, hospitality and/or leisure industry.

• Cash grants for eligible businesses operating in the retail, hospitality and and/or leisure industry.

• A business rates holiday for eligible nursery businesses.

• A cash grant for businesses qualifying for Small Business Rate Relief (SBRR), Rural Rate Relief (RRR) or tapered relief.

Further details and the eligibility criteria for each scheme is detailed separately below:

Business rates holiday for retail, hospitality and leisure businesses

You are eligible for the business rates holiday if your business is based in England and operates in the retail, hospitality and/or leisure sector.

Properties that will benefit from the relief will be occupied properties that are wholly or mainly being used:

• as shops, restaurants, cafes, drinking establishments, cinemas and live music venues

• for assembly and leisure

• for hospitality, as hotels, guest & boarding premises or self-catering accommodation

A detailed list of the businesses that the government consider qualifying can be found in the local authority guidance (page 5-8):

Expanded_Retail_Discount_Guidance_02.04.20

Cash grants for retail, hospitality and leisure businesses

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

You are eligible for the grant if:

• your business is based in England

• your business is in the retail, hospitality or leisure sector

• your business has a rateable value of under £51,000

Eligible businesses in these sectors with a property may qualify for the following grants:

£10,000 – for properties with a rateable value of up to £15,000.

£25,000 – for properties with a rateable value between £15,000 and £51,000.

You can find your rates valuation at the following link:

https://www.gov.uk/correct-your-business-rates

Properties that will benefit from the relief will be occupied properties that are wholly or mainly being used:

• as shops, restaurants, cafes, drinking establishments, cinemas and live music venues

• for assembly and leisure

• as hotels, guest and boarding premises and self-catering accommodation

Again, a full list can be found within the local authority guidance provided above.

Support for nursery businesses that pay business rates

There is also a business rates holiday for qualifying nurseries in England for the 2020 to 2021 tax year.

You are eligible for the business rates holiday if:

• your business is based in England

Properties that will benefit from the relief must be:

• occupied by providers on Ofsted's Early Years Register

• wholly or mainly used for the provision of the Early Years Foundation Stage

Support for businesses that pay little or no business rates

The government will provide funding for local authorities to support small businesses that already pay little or no business rates because of Small Business Rate Relief (SBRR), Rural Rate Relief (RRR) and tapered relief. This is known as the Small Business Grant Scheme. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

You are eligible if:

• your business is based in England

• you are a business that occupies property

• you are receiving Small Business Rate Relief or Rural Rate Relief as of 11 March.

How to access the above schemes

All of the above schemes are administered by the local authority. It was initially announced that the relevant local authority would contact eligible businesses, however some local authorities have decided to operate an applications process. Therefore if you believe your business will be eligible but have not been contacted by your local authority, we would recommend you enquire about the application process. 

02/04/2020

Further to our previous post in relation to the Coronavirus Business Interruption Loan Scheme (CBILS), we understand that chancellor Rishi Sunak is currently reviewing the scheme and an overhaul is expected in the coming days.

The scheme has been widely criticised as it has proved too difficult for businesses to obtain the finance that is urgently required.

Under the scheme as it currently stands, a key issue is that the lender is required to evaluate whether the business could obtain finance on normal commercial terms before providing the option of borrowing under the scheme. Of course, borrowing under normal commercial terms is likely to be more costly for a business as a result of arrangement fees and interest charges. Whereas, under the scheme, there are no arrangement fees and the loan is interest free for the first 12 months.

We expect the chancellor to address this issue and it is being reported that the requirement to assess the business for a normal commercial loan will be removed.

We are also aware that a number of lenders are unwilling to provide the loans without the inclusion of a personal guarantee. Again, it is expected that the chancellor will address this within his announcement.

We will provide full details in due course once the announcement takes place.

In the meantime, please do not hesitate to get in touch if we can be of assistance.

02/04/2020

It was originally announced that all self employed taxpayers would be able to defer their July payment on account in order to ease cash flow in the wake of the coronavirus outbreak. This deferral has now been extended to all taxpayers.

Therefore any taxpayer with a payment on account due by the end of July may defer the payment until 31 January 2021.

This is an automatic offer and no application is required. If you would prefer to make the payment in the normal manner you can continue to do so. However, for those who choose to defer, no penalties or interest will be charged.

Please note, this is a deferral only and not a reduction in the liability, therefore the amount due at 31 January 2021 will be higher.

We would urge all individuals to submit their 2019/20 self assessment tax returns as early as possible. This won't alter the due date of any payments but will give certainty over the amounts due so that time to pay arrangements can be agreed with HMRC where necessary.

27/03/2020

Yesterday evening, the chancellor announced his eagerly anticipated support package for self-employed individuals. The new scheme has been referred to as the Self-Employment Income Support Scheme (SEISS).

The scheme will allow qualifying individuals to claim a taxable grant worth 80% of trading profits up to a maximum of £2,500 per month for the next 3 months. This timeline may be extended if needed.

This applies to self-employed individuals and members of a partnership where the following conditions have been met:

• You have submitted your self assessment tax return for the tax year 2018-19.
• You have traded in the tax year 2019-20.
• You are trading when you apply for the grant, or would be except for COVID-19.
• You intend to continue to trade in the tax year 2020-21.
• You have lost trading/partnership trading profits due to COVID-19.
• Your self-employed trading profits must be less than £50,000.
• More than half of your income must come from self-employment.

In order to determine whether your trading profits are less than £50,000/this is more than half your income, either of the following methods can be used:

• Your trading/partnership profits in 2018-19 are less than £50,000 and these profits constitute more than half of your total taxable income.
• Your average trading profits in 2016-17, 2017-18, and 2018-19 are less than £50,000 and these profits constitute more than half of your average taxable income in the same period.

For any individuals who started trading between 2016-19, HMRC will only use those years for which you filed a self-assessment tax return. For those who have not submitted their 2018/19 self assessment tax return, this must be submitted by 23 April 2020 in order to qualify.

Unfortunately, it has been confirmed that those who were not trading before 5 April 2019 will be ineligible for the scheme. As things stand, those individuals will need to rely on loans or the welfare system.

For those who qualify, you will receive a taxable grant which will be 80% of the average profits from the following tax years (where applicable):

• 2016 to 2017
• 2017 to 2018
• 2018 to 2019

These figures will be used to calculate a monthly average income, subject to a maximum of £2,500 per month.

The scheme is likely to be in place by the beginning of June, however the government have committed to putting this in place sooner if possible. The grant will be paid in a single instalment and those who are eligible will be contacted by HMRC and invited to complete an application form.

HMRC have requested that those who can apply do not contact them in the meantime as this will delay the work being undertaken to put the scheme in place.

Please note, we are seeing an increase in fraudulent activity/scam emails as a result of COVID-19. We are expecting a vast number to arrive promising this refund. Please exercise caution if you receive any calls, texts or emails claiming to be from HMRC. You will not be emailed with a link to provide your bank details and instead this will be via an online portal with HMRC.

For those who are experiencing cashflow issues and cannot afford to wait for the scheme, loans can be applied for using the business interruption loan scheme, which can then be repaid on receipt of the grant.

Please do not hesitate to get in touch should you require assistance with completion of your 2018/19 tax return (if not submitted already), the business interruption loan scheme or any other matters.

26/03/2020

HMRC have now issued guidance relating to the VAT deferral for payments arising between 20th March 2020 and 30th June 2020 if there is a direct debit in place. To ensure no payment is made to HMRC, the direct debit with your bank must be cancelled. This should be done as far in advance before the VAT payment is due to be made - otherwise HMRC will automatically collect it.

Once the VAT deferral period has expired, the direct debit must be set up again for future VAT returns and corresponding VAT payments. Agents cannot set up the direct debit payments on behalf of taxpayers.

The VAT liability in this deferral period has to be repaid to HMRC no later than 5th April 2021. Any VAT registered business not affected by Covid 19 can choose to continue making their VAT payments as normal.

All VAT returns are still due to be submitted on time in this deferral period.

If you have any questions or concerns, please do not hesitate to get in touch.

24/03/2020

The previously announced Coronavirus Business Interruption Loan Scheme (CBILS) is now live.

This is a new scheme which has been set up to provide loan facilities of up to £5m for smaller UK businesses who are experiencing cashflow difficulties as a result of COVID-19.

A sumary of the key features of the scheme can now be found on the British Business Bank website:

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

Please note, the scheme is only available to UK businesses meeting the following conditions:

• UK based business activity with turnover of £45m or less.
• Have a borrowing proposal which would be considered viable by the lender were it not for the current pandemic and for which the lender believes the provision of finance will enable the business to trade out of any short to medium term difficulty.

If the lender would be willing to offer finance to the business on normal commercial terms, without the use of the scheme, they will do so.

The finance is to be arranged directly through one of the British Business Bank's 40+ accredited lenders, which includes most high street banks.

The advice is for each business to approach their own provider in the first instance. The relevant bank is likely to have information on their website about the application procedure.

Each lender will have their own requirements, however, it is expected that businesses will require a proposal, which could include cashflow/profit forecasts and projections.

Please do not hesitate to get in contact should you have any questions or require assistance with the proposal.

Take care and stay safe.

18/03/2020

Support Measures For Individuals and Businesses

Further to the budget last week, yesterday evening the government announced further support measures for individuals and businesses affecting by the COVID-19 pandemic. The new measures increase the value of the rescue package to £330billion in an effort to support the economy. Chancellor Rishi Sunak also stated that if demand is greater than the initial £330billion, he will go further and provide as much capacity as required.

The support measures announced yesterday and within the budget include:

Businesses

Statutory Sick Pay (SSP):

• The government will support small and medium-sized businesses with the extra costs of paying COVID-19 related Statutory Sick Pay. The refund will be limited to two weeks per employee. Employers should maintain records of staff absences in order to reclaim the refund but should not require employees to provide a GP note.
• The existing systems are not designed to facilitate such refunds, therefore the government will work with employers over the coming months to set up a repayment mechanism.

Business Rates Relief:

• The government had already announced the Business Rates retail discount would be increased to 50% in 2020-21. To support small businesses affected by COVID-19 the government is increasing it further to 100% for 2020-21. The relief will also be expanded to the retail, leisure and hospitality sectors for 12 months. Originally only businesses in those sectors with a rateable value below £51,000 would be eligible but this will now apply to those above this threshold.
• The government has also already announced the introduction of a £1,000 Business Rates discount for pubs with a rateable value below £100,000 in England for one year from 1 April 2020. To support pubs in response to COVID-19 the discount will be increased to £5,000.

Small business grant funding:

• Many small businesses pay little or no business rates because of Small Business Rate Relief (SBRR). To support those businesses, the government announced during the budget that they will provide £2.2billion of funding for Local Authorities in England. This will provide £3,000 to around 700,000 business currently eligible for SBRR or Rural Rate Relief, to help meet their ongoing business costs. This figure has now been increased to £10,000.

Time to Pay:

• Businesses and self-employed individuals in financial distress will receive support with outstanding tax liabilities.
• HMRC have now set up a dedicated helpline to agree payment plans. Late payment penalties and interest may also be cancelled.

Coronavirus Business Interruption Loan Scheme:

• A business interruption loan scheme will be introduced temporarily to assist businesses with cashflow issues. The government will provide lenders with a guarantee of 80% on each loan to ensure these are more accessible. The scheme will support loans of up to £5million in value (this was initially set at £1.2million in the budget).

IR35 rules:

• The controversial roll-out of the new private sector IR35 regime will be delayed by a year until April 2021.

Individuals

Statutory Sick Pay (SSP):

• For individuals who have COVID-19 or have to self isolate in accordance with government guidance, SSP will be paid from the first day of sickness rather than the fourth, which is normally the case.
• Guidance has been issued to employers advising them to use their discretion not to require medical evidence for COVID-19 related absences.

Support for those ineligible for SSP:

• Support will be provided for those who are ineligible for Statutory Sick Pay, including individuals who are self-employed.
• 'New style' Employment and Support Allowance will be payable for people directly affected by COVID-19 or self-isolating according to government advice from the first day of sickness, rather than the eighth day.
• People will be able to claim Universal Credit and access advance payments where they are directly affected by COVID-19 (or self-isolating), without the current requirement to attend a jobcentre.
• During the outbreak, the requirements of the minimum income floor in Universal Credit will be temporarily relaxed for those directly affected by COVID-19 or self-isolating according to government advice for the duration of the outbreak, ensuring self-employed claimants will be compensated for losses in income.

Hardship Fund:

• The government will provide Local Authorities in England with £500million of new grant funding to support economically vulnerable people and households in their local area. The government expects most of this funding to be used to provide more council tax relief, either through existing Local Council Tax Support schemes, or through complementary reliefs.

Mortgage 'Holiday':

• For individuals who are in financial difficulty due to the coronavirus, mortgage lenders will offer a three-month mortgage 'holiday'.

We expect to receive further announcements in the coming days. Some possible measures include:

• Support for airlines and airports.
• Measures to help those who are renting.

We will be providing regular updates across our social media.

Please follow us on Twitter and LinkedIn to ensure you are kept up to date.

Twitter - https://twitter.com/PerrysAccs

LinkedIn - https://www.linkedin.com/company/perrys

If you are not on social media but would like to receive regular updates, please let us know and this can be arranged.

If you have any questions, please do not hesitate to get in touch.

We will be here to support our clients during these uncertain times.