COVID-19 News and Updates

Please find below all updates and current news regarding the changing circumstances surrouding the COVID-19 outbreak.

27/01/2021

SPAM EMAIL ALERT

Please be aware of the following spam email that is currently in circulation, which is appearing to be from NHS England regarding the COVID-19 Vaccination

This is a spam email, so if you receive this, please do NOT click on the links or reply to the email.

For more information on spam emails visit GOV.UK

27/01/2021

The deadline for claiming the third SEISS grant is fast approaching. If you are eligible, you must make a claim on or before 29‌‌‌ ‌January 2021.

As with the first and second SEISS grants, the third grant will be subject to Income Tax and self-employed National Insurance and must also be reported on your 2020-21 Self-Assessment tax returns (to be submitted by 31‌‌‌ ‌January 2022).

The SEISS claim is calculated the same as the first two claims which is 80% of your average monthly trading profits up to a maximum of £7,500 to cover the 3 months and it is paid in one instalment.

Confirming a significant reduction in trading profits

Before you make a claim for the third grant, you must decide if the impact on your business will cause a significant reduction in your trading profits for the tax year you report them in.

HMRC cannot make this decision on your behalf because your individual and wider business circumstances will need to be considered when deciding whether the reduction is significant.

You must not claim if the only impact on your business is increased costs. For example, if you have had to purchase face masks and cleaning supplies. This would not be considered as reduced activity, capacity or demand.

You do not have to consider any other coronavirus scheme support payments you have already received when deciding whether you reasonably believe that you will suffer a significant reduction in trading profits due to reduced activity, capacity, demand or inability to trade due to coronavirus during 1‌‌‌ ‌November 2020 to 29‌‌‌ ‌January 2021 (period covered by the third grant).

Support

HMRC recently sent a letter to those who have been identified as potentially requiring extra support. At the time of writing to them, the recipients had yet to claim for the third SEISS grant, and HMRC believe they may be eligible, depending on the circumstances of their business. The letter included details of the deadline for claiming the third SEISS grant, HMRC’s digital claim service, and the number of a helpline for those requiring additional support.

Details of the extra support can also be found on GOV.UK.

The third SEISS grant and working parents

If you are unable to work because you have additional caring responsibilities due to school closures, and you meet all other conditions, you are eligible to claim, provided you reasonably believe that the impact of taking this time off will significantly reduce your trading profits for the year that you report them in.

Details of the eligibility criteria can be found on GOV.UK.

Other types of work and the third SEISS grant

Due to the impacts of coronavirus, we know that some who are usually self-employed are also seeking other forms of work.

If you receive the grant you can:

  1. Continue to work.
  2. Start a new trade or take on other work including voluntary work and duties as a military reservist.

You must also declare that you intend to continue to trade.

The fourth SEISS grant

Information about the fourth SEISS grant will be provided on 3‌‌‌ ‌March.

25/01/2021

If you deferred VAT between 20 March and 30 June 2020 and you still have payments due you can either pay your VAT liability in full by 31st March 2021, opt in to the VAT deferral new payment scheme or contact HMRC for help if you need more time to pay.

The VAT deferral new payment scheme is currently not available but is expected early 2021. You must opt in yourself, your agent cannot do this for you. To be eligible for the scheme you must meet the following criteria:

  • You must still have deferred VAT to pay
  • Be up to date with your VAT return submissions
  • Opt in before 31st March 2021
  • Pay the first instalment before 31st March 2021
  • Be able to pay the instalments by Direct Debit

You can choose how many instalments you wish to make between 2 and 11 and all instalments must be paid by 31st March 2022. No interest charges will be added.

To opt into the scheme you must have a government gateway account, ensure any outstanding VAT returns from the last 4 years are submitted and correct any errors on your VAT returns as soon as possible. Any corrections received after 31st December 2020 may not show in your balance for the deferred VAT new payment scheme.

HMRC are encouraging if you can make any payments before 31st March 2021 then to do so as soon as possible so the correct balance will show before you set up the payment plan.

Should you need more time to pay your deferred VAT then please contact the Payment Support Service at HMRC on 0300 200 3835 to make other arrangements to pay your liability.

05/01/2021

As the country enters a third national lockdown, the Chancellor Rishi Sunak has announced further grants to support impacted businesses.

Details of the two additional grants are as follows:

Retail, Hospitality and Leisure Businesses

Retail, hospitality and leisure businesses will be eligible for a one-off ‘top up grant’. Like previous grants, the amount provided will be on a per property basis, dependent on the rateable value:

  • £4,000 for businesses with a rateable value of £15,000 or under
  • £6,000 for businesses with a rateable value between £15,000 and £51,000
  • £9,000 for businesses with a rateable value of over £51,000

These grants will be administered by the relevant local authority.

Other businesses

In addition, a further £594 million ‘discretionary fund’ is being made available to support other impacted businesses. Again, businesses will need to apply through their local authority

The above grants are available to qualifying businesses in addition to any existing support measures.

The Chancellor also confirmed that he would consider how or whether to extended support packages in the next budget on 3 March.

Please do not hesitate to get in touch should you require any further advice.

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.

06/11/2020

Further to our previous post, yesterday (05/11/2020) Rishi Sunak announced a further change to the Coronavirus Job Retention Scheme (CJRS), also known as the Furlough Scheme.

The key points to note are:

  • The scheme will now remain in place until 31 March 2021 to ‘give businesses security through the winter’. It was first announced that this was only a temporary extension to 30 November before being replaced by the Job Support Scheme (as detailed below).
  • Initially, the rates of support provided will be as indicated in our email below.
  • The scheme will then be reviewed in January and the government will decide whether economic circumstances have improved enough for employers to contribute more.
  • Full guidance will be released on 10 November.

Of course, the new Job Support Scheme was due to cover the period 1 November to 31 March, therefore it remains to be seen whether this will be introduced after March or at all.

We will post details on our social media pages once the full guidance is received so please follow/connect with us to receive updates:

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

Facebook - https://en-gb.facebook.com/perryscharteredaccountants/

Twitter - https://perrysaccountants.co.uk/

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.

1/10/2020

The Coronavirus Job Retention Scheme/Job Support Scheme

The existing Coronavirus Job Retention Scheme (or Furlough Scheme) will finish at the end of October as originally planned. However, this will be replaced by a new Job Support Scheme from 1 November. The details we have so far are:

  • The scheme is intended to support viable UK employers who face a reduced demand as a result of COVID-19.
  • Employees will need to work at least a third of their normal hours and be paid in full by their employer for that time.
  • For every hour not worked, the government and the employer will each pay one third of the employee’s usual pay.
  • The government contribution will be capped at £697.92 per month.
  • This means employees will receive at least 77% of their usual pay if the government contribution is less than the cap.
  • Employers will be reimbursed in arrears for the government contribution i.e. this must be paid to the employee and then claimed back.
  • The employee must not be on a redundancy notice.
  • The scheme will run for a period of six months from 1 November 2020.
  • It will be open to all employers with a UK bank account and UK PAYE scheme, even if relevant employees have not previously been furloughed.
  • All small and medium sized businesses will be eligible.
  • Any large businesses must demonstrate that they have been adversely affected by COVID-19. In addition, the government expect that distributions to shareholders (e.g. dividends) will not be made whilst using the scheme.

Self Employed Income Support Scheme (SEISS)

  • The scheme is to be extended for a further six months covering the period November 2020 to April 2021.
  • It will be limited to self employed individuals who are eligible under the current rules and are actively continuing to trade but facing a reduced demand as a result of COVID-19.
  • As with previous payments, it will be in the form of two taxable grants.
  • The first grant will cover the period November 2020 to January 2021. It will cover 20% of average monthly trading profits, capped at a total of £1,875.
  • The second grant will cover February 2021 to April 2021. The rate for the second grant will be confirmed in due course.

Other announcements:

  • The reduced VAT rate of 5% for businesses operating in the hospitality and tourism industry was due to end on 12 January. However, this has now been extended to 31 March 2021.
  • The government backed loan schemes will be extended to 30 November 2020 for new applications. This includes the Bounce Back Loan Scheme (BBLS), the Coronavirus Business Interruption Loan Scheme (CBILS), the large scheme (CLBILS) and the Future Fund.
  • Pay as you grow – Businesses that have borrowed under the BBLS will have the option to pay back their loan over a period of up to ten years. In addition, they will also have the option to move to interest only payments for up to six months.
  • The government also intends to allow CBILS lenders to increase the term of a loan to up to ten years.
  • Businesses who deferred their VAT liability earlier in the year will be given the option to spread their payments over the 2021/2022 financial year. All businesses will be eligible but will need to opt in when the process is launched during early 2021.
  • Taxpayers will be given more time to settle self assessment tax liabilities falling due during January 2021. Those with liabilities of up to £30,000 will be able to use a time to pay facility to spread the liability over an additional twelve months.

As with previous announcements, further guidance is likely to be released in the coming weeks.

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.  

13/07/2020

Self-Assessment Payments on Account – The Second Instalment (COVID-19 Edition)

Many individual taxpayers will soon be receiving a Self-Assessment statement from HM Revenue & Customs. This statement will have a payslip attached to it in respect of the 2nd payment on account for the 2019/20 tax year. This second payment on account would usually be due for payment by 31 July 2020 to avoid any interest and charges being levied by HMRC.

Virtually all individuals will have felt the effect of Covid-19 in one form or another. As a result, as part of their coronavirus support measures, HM Revenue & Customs are allowing UK registered tax payers who are finding it difficult to pay the second payment on account for 2019/20, an option to defer this tax payment until up to 31 January 2021.

If you choose to defer the July 2020 payment, you do not need to inform HMRC, no action is required and HMRC will not levy interest or penalties on the deferred amount, provided it is paid on or before 31 January 2021.

Many taxpayers will view this as a welcome interest-free cash flow support provision from HMRC.

However, please remember that the tax will still fall due – by 31 January 2021. If the option to defer the July payment on account is taken up, then by 31 January 2021 there would potentially be up to three tax payments falling due on this date, being - the deferred 2019/20 2nd payment on account; any balancing tax liability owed for 2019/20; and the 1st payment on account for the 2020/21 tax year.

Therefore, it is important to view the July tax deferral option as merely a matter of timing.

What if I choose to pay my tax in July 2020?

Individual taxpayers can choose to make the 2nd payment on account by 31 July 2020.

However, before instinctively logging into their online bank accounts to pay this second payment on account, I urge taxpayers to ask themselves a question; is this the correct amount to pay?

The payment on account system was originally devised as a method of spreading the financial hardship of paying a tax bill in two instalments across the year. However, if a tax liability for the tax year turns out to be lower than the payments on account made during the year, it can be quite galling to realise that you have overpaid an unnecessary amount of tax to HMRC. In addition, there can be a time delay by HMRC in processing repayments – perhaps the money would be better off staying in the individual's bank account, rather than with the Revenue? Especially given these unprecedented times.

The solution: have your 2019/20 Self-Assessment tax return prepared at the earliest opportunity.

If the overall tax liability for 2019/20 is less than the expected payments on account for the year, a claim can be made to reduce the 2nd payment on account and therefore reduce the payment required to be made to HMRC.

By preparing the tax return at the earliest opportunity, the actual tax liability for 2019/20 will be calculated, along with the potential reduction in the July payment (which cannot increase). This will also give the individual an increased amount of time to prepare or save for any tax due by the next payment deadline, being 31 January 2021.

If you require any advice on Self-Assessment tax payments, please contact your nearest Perrys office.

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.

05/06/2020

CORONAVIRUS STATUTORY SICK PAY REBATE SCHEME

It has been confirmed that a new online service will launch from 26 May to enable small and medium-sized employers with fewer than 250 employees to recover Statutory Sick Pay (SSP) payments they have made to their employees.

The Coronavirus Statutory Sick Pay Rebate Scheme was announced as part of a package of support measures for businesses affected by the COVID-19 outbreak.

The scheme will reimburse employers for Statutory Sick Pay (SSP) paid to current or former employees if they are unable to work because they either:

  • have coronavirus (COVID-19) symptoms
  • cannot work because they are self-isolating because someone they live with has symptoms
  • are shielding and have a letter from the NHS or a GP telling them to stay at home for at least 12 weeks

The repayment will cover up to 2 weeks starting from the first qualifying day of sickness, starting on or after:

13 March 2020 - if your employee had coronavirus or the symptoms or is self-isolating because someone they live with has symptoms

16 April 2020 - if your employee was shielding because of coronavirus

The weekly rate from 6 April 2020 is £95.85 (the previous rate was £94.25).  An employer can choose to pay more than this amount, however the difference cannot be reclaimed.

To prepare for the claim, employers should collate a list of any applicable SSP payments made to employees during this period.

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. 

03/04/2020

Further to our previous updates on the Coronavirus Business Interruption Loan Scheme (CBILS), the Chancellor Rishi Sunak has made changes to the scheme to ensure that finance is more readily available to assist businesses struggling with cash flow issues.

The key changes announced are:

  • Lenders will be banned from requested personal guarantees on loans under £250,000.
  • For loans in excess of £250,000, personal guarantees will be limited to 20% of any outstanding amount, after recoveries from business assets.
  • The scheme will be available to all viable small businesses and not just those who are unable to obtain finance on normal commercial terms.
  • There will be operational changes to speed up lending approvals.
  • The government will continue to cover the first 12 months of interest and arrangement fees.

These changes will apply to finance already offered under the scheme to ensure that all businesses receive the same level of government protection.

New alternative finance lenders are also being accredited under the scheme to create more choice and diversity for smaller businesses.

In addition a new scheme has been announced for larger companies. The new scheme is being referred to as the Coronavirus Large Business Interruption Loan Scheme. The scheme will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover between £45 million and £500 million. Further details on the scheme are expected later this month.

The Chancellor will be speaking to bank chief executives next week to ensure the schemes are working and finance is readily available.

Please do not hesitate to contact us should you have any questions or require assistance with preparing cash flow/profit projections or forecasts which may be required as part of 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

Coronavirus Business Interruption Loan Scheme (CBILS):

We understand that chancellor Rishi Sunak is currently reviewing the business interruption loan 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.

We expect the chancellor to address this issue and it is being reported that this requirement will be removed to make the scheme more accessible.

A further issue is that the majority of lenders are insisting on personal guarantees before providing funds. Given the economic uncertainty, many businesses aren't willing to proceed on these terms, making the scheme ineffective. Again, we expect the chancellor to address this issue within the 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.

31/03/2020

The government have now released some further guidance for the previously announced job retention scheme.

The key points are as follows:

Scheme Details

  • The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers for at least three months starting on 1 March 2020.
  • The scheme is designed to support employers whose operations have been negatively affected by the coronavirus. The primary aim is to keep staff employed and avoid redundancies as far as possible. In order to achieve this aim, staff who are no longer able to work can be 'furloughed' so they are available once the business resumes.
  • HMRC will provide a grant to cover the lower of:
    • 80% of an employee's regular wage or;
    • £2,500 per month
  • In addition, the grant will also cover the associated employer national insurance contribution and the minimum automatic enrolment employer pension contribution. As such, the maximum grant that can be applied for is £2,804 per employee per month (£2,500 salary contribution, £245 employer's national insurance, £59 employer pension auto enrolment contribution). This will apply for employees on a salary of £37,500 or higher, where the employer minimum pension contribution of 3% is being made.
  • As a minimum, employers must pay their employee the lower of 80% of their regular wage or £2,500 per month. An employer can choose to top up an employee's salary beyond this amount but they are not obliged to do so.
  • The scheme is open to all UK employers that had a PAYE scheme in place on or before 28 February 2020. Those employers must also have a UK bank account.
  • In order to claim the grant, employees who are no longer able to work must be 'furloughed' (further details provided below).

Which employees can be included?

  • The furloughed employees must have been on the payroll as at 28 February 2020.
  • Employees can be on any type of contract, including full time, part time, flexible or zero hour contracts and agency contracts. See the information below for company directors.
  • For full time and part time salaried employees, the employee's actual salary before tax, as of 28 February should be used to calculate the 80%. Fees, commission and bonuses should not be included.
  • For employees on variable or zero hour contracts:
    • If the employee has been employed (or engaged by an employment business) for a full twelve months prior to the claim, you can claim for the higher of either:
      • the same month's earning from the previous year
      • average monthly earnings from the 2019-20 tax year
    • If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work.
    • If the employee only started in February 2020, use a pro-rata for their earnings so far to claim.

Other conditions

  • In order to claim, employers will need to designate those particular employees as 'furloughed'. This is subject to employment law and may require some negotiation depending on the particular terms of the employment contract. We would encourage employers to take legal advice where necessary.
  • Employers should write to the relevant employees to confirm they have been furloughed and keep a copy of this letter.
  • Whilst furloughed, an employee cannot undertake work for or on behalf of the organisation.
  • If an employee is working but on reduced hours/pay, they will not be eligible for the scheme.
  • Employees on sick leave or self isolating will be eligible for statutory sick pay but can be furloughed on returning to work.
  • If any employee has more than one job, they can be furloughed for either or both jobs and the cap applies to each employer individually.

How to claim

The grant will be claimed through a new online portal. This is currently being worked on and is expected to be in place by the end of April.

The information that will be required in due course is as follows:

  • your ePAYE reference number
  • the number of employees being furloughed
  • the claim period (start and end date)
  • amount claimed (per the minimum length of furloughing of 3 weeks)
  • your bank account number and sort code
  • your contact name
  • your phone number

Employers (or their agent) will be required to calculate the amount of the grant due. HMRC will then have the right to review any aspect of the claim following submission.

Other Matters

  • Furloughed employees retain the same rights as they did previously. This includes Statutory Sick Pay entitlement, maternity rights, other parental rights, rights against unfair dismissal and to redundancy payments.
  • Wages of furloughed workers continue to be subject to Income Tax and National Insurance in the normal manner.
  • Payments made to a business under the scheme are made to offset revenue costs and therefore will be considered taxable income for the business.

Company Directors

Originally, there was a concern that company directors would be unable to qualify for the scheme due to company law requirements and the need to undertake certain matters on behalf of the company. However, it has now been confirmed that directors will be eligible for the scheme, provided the above conditions are met.

The main issue, is that once furloughed, an employee cannot undertake any work for the company during this time. In terms of a director, it has been confirmed that they can continue to undertake statutory duties but no other work. No doubt, there will be some debate as to what is considered a statutory duty but this should include filing returns (dealing with VAT, PAYE and Company Accounts), maintaining records and attending board meetings.

This certainly excludes any activities undertaken to generate revenue on behalf of the company.

Please note, the amount which can be claimed under the grant is limited to salary only and cannot include dividends.

The measures announced and guidance provided by the government is continually developing, therefore we will provide further updates when information is available.

Please do not hesitate to contact us should you have any queries.

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

The chancellor has announced his eagerly anticipated support package for self-employed individuals. The key points from the announcement are as follows:

  • Self-employed individuals are to be provided with a taxable grant to cover lost earnings as a result of the COVID-19 outbreak.
  • This will cover 80% of their average monthly profits, calculated over the previous three years (or less for those who have not been trading for this length of time).
  • As with the job retention scheme, this will be capped at £2,500 per month and will only be available for those with trading profits of less than £50,000.
  • This will only apply to those who are already self-employed to prevent abuse of the system.
  • The scheme is expected to be in place by the start of June and HMRC will contact relevant individuals directly.
  • Individuals who haven't submitted their 2019 tax return will be given 4 weeks to get their tax affairs up to date and benefit from the scheme.

Full details will be provided in due course once available.

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.

26/03/2020

CORONAVIRUS UPDATE

We would like to reassure everybody that we remain very much open to support all our clients, other businesses and individuals through these trying times.

OFFICE ACCESS

Whilst we have closed our offices to protect staff, clients and the wider public in accordance with the Government's guidelines we still have access for staff to collect files, records or post where this is needed. If you need to make a delivery of documents that cannot be sent electronically please contact us.

CONTACT DETAILS

To ensure that you have access to us for any advice and guidance each of our office numbers have been diverted to a member of staff who will arrange for a message to the person best able to deal with your enquiry for them to call you back. All the contact numbers are on our website https://perrysaccountants.co.uk/contact

In addition please feel free to contact any of the partners on:

Craig Harman 07909 690009 harman@perry-company.co.uk

Declan McCusker TBA mccusker@perry-company.co.uk

Donna McCreadie 07923 454328 mccread@perry-company.co.uk

Estelle Hardwick 07789 324687 hardwick@perry-company.co.uk

Simon Hayden 07776 306743 hayden@perry-company.co.uk

Steve Hale 07909 690007 hale@perry-company.co.uk

Stewart Pope 07909 690002 pope@perry-company.co.uk

Victoria Pearson 07749 420405 pearson@perry-company.co.uk

Zoe Gibbons 07900 375387 gibbons@perry-company.co.uk

CLIENT MEETINGS

Most of our client meetings are being undertaken by phone, video calls, Skype etc. Where site visits are a necessity we will work with you to ensure 'social distancing' and correct hygiene procedures are adhered to.

BEING THERE

these unprecedented times our aim is to be there for you whether it is for accounts and tax advice, helping you to navigate through the Government's ongoing support measures, looking at protection in the form of wills/LPA's and business continuity or just for a friendly chat. Please do not hesitate to contact us.

Our very best wishes

The Partners of Perrys

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.

23/03/2020

On Friday evening the Chancellor Rishi Sunak announced further support measures to combat the financial impact of the COVID-19 outbreak.

New measures are being announced regularly, however in some cases, the finer details as to how and when these schemes will operate are still to be revealed. A summary of the information released to date has been included below and further details will be provided once available.

The measures announced Friday evening are as follows:

Coronavirus Job Retention Scheme:

  • HMRC will reimburse 80% of an employee's wage cost for those unable to work due to the outbreak. This is subject to a cap of £2,500 per month.
  • All UK businesses, regardless of size, will be eligible for the scheme.
  • In order to claim, employers will need to designate any affected employees as 'furloughed workers' and notify employees of this change. This change of status remains subject to employment law and the particular terms of the employment contract.
  • The scheme will be backdated to 1 March and can cover the wage costs of employees who have already been released if they are re-employed.
  • The current systems are not currently set up to facilitate repayments to employers, therefore HMRC are urgently working on a new system. As such, we do not have a confirmed start date or any specific details for the procedure. However, it is expected that this will be in place by the end of April and details are likely to be provided through a new online portal.
  • We would urge employers to keep detailed records to ensure claims can be made once the scheme is operational

Deferral of VAT payments:

  • All UK businesses, with a VAT period falling between 20 March 2020 and 30 June 2020 will be able to defer payment of the liability.
  • This is an automatic offer and doesn't need to be applied for. Therefore businesses will need to submit their VAT return as normal but do not need to make the payment to HMRC.
  • Taxpayers will then be given the remainder of the tax year (5 April 2021) to settle the liability.

Deferral of income tax payments (for self-employed individuals):

  • Individuals who are self-employed will be able to defer payment of their July payment on account.
  • Again, this is an automatic offer and doesn't need to be applied for.
  • The full liability will then need to be settled by 31 January 2021.
  • Based on the information provided to date, this deferral does only apply to those who are self employed, therefore individuals with dividend or rental income should expect that their July payment on account is due as normal. This should be confirmed in due course.

For any businesses facing cashflow issues, the business interruption loan scheme should be available this week with further details expected today. It is anticipated that this will provide businesses with adequate resources in the short-term until other measures are up and running (such as the job retention scheme).

Please follow us on social media for more regular updates:

Twitter - https://twitter.com/PerrysAccs

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

Facebook - https://en-gb.facebook.com/perryscharteredaccountants/

Please do not hesitate to contact us should you have any questions regarding the above measures or any other concerns. We are here to support our clients during these difficult times.

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.

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