C-19 Business News Update

Updated 11 January 2021

CORONAVIRUS IMPACT AND EDWARDS & KEEPING

Please note that our office remains open 8:30 am to 5:00 pm to allow mail to be accepted, telephone calls handled and books to be received (these can be safely left in the lobby). We have a limited number of staff working on site and social distancing is being strictly observed. The majority of our staff are currently working from home and the overall situation is being carefully managed to ensure that both staff and clients are suitably protected and that robust levels of service are maintained during this difficult time for us all. If you have any worries or concerns in this respect, please contact us by telephone or email and we will be pleased to clarify matters for you.

What financial support is available?

H M Revenue & Customs (HMRC) have issued a user-friendly question-based assessment form, which allows you to enter details of your business in the form of answering ten simple questions. The first question is “Where is your business based?” and on answering from one of the four answers given, you move onto the next question. On completion of this it then details the support which is available for you and your business, with links to the various schemes which are detailed below. The link to the support finder is as follows.

https://www.gov.uk/business-coronavirus-support-finder

Based upon the current announcements by the government, we detail below the information currently available for employers and businesses. Full details of the guidance can be found on the following website links. These websites are updated regularly, following government announcements. Guidance and support can be found via the following link.

https://www.gov.uk/coronavirus

BE AWARE

There are a number of scam text messages being sent out purporting to be from HMRC and readers should be wary of these, as a number of these scam texts link to forms asking you to fill out your personal information and credit card details.

Sick Pay for employees

This is available to employers with less than 250 employees, as determined by the number of employees they employed as at the 28 February 2020. Employers will be able to claim up to two weeks Statutory Sick Pay (SSP) per employee as a result of COVID-19, and should maintain records of staff absences, although staff will not be required to provide a fit note (Sometimes referred to as a sick note) from their GP. An isolation note is available through NHS 111.

https://111.nhs.uk/isolation-note/

The payment to staff will be available from the first day and there will be no waiting period.

To recover the statutory sick pay, use the following link.

https://www.gov.uk/employers-sick-pay

Those not eligible for Sick Pay such as employees earning below the Lower earnings Limit of £120 per week, can make a claim for Universal Credit or Contributory Employment and Support allowance. This is also available to the self-employed.

SSP applies to those who follow advice to stay at home, even if they are not sick themselves. If evidence is required to cover self-isolation or household isolation beyond the first 7 days of absence, then employees can get an isolation note from NHS 111 online.

Coronavirus Job Retention Scheme [CJRS]

The job retention scheme has been extended until 30 April 2021.

If a business is unable to maintain its workforce, then it can furlough employees for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked.

You do not need to have previously claimed for an employee prior to the 30 October 2020 to claim.

Employers can claim for employees who were employed on the 30 October 2020, as long as they made a PAYE RTI submission between the 20 March 2020 and 30 October 2020, notifying a payment for that employee. This may differ where you have made employees redundant, or they stopped working for you on or after 23 September 2020 and you have subsequently re-employed them.

The government will fund grants to employers up to 80% of the furloughed employees usual monthly wage cost, up to £2,500 a month.

The workers will still retain all employment rights during this period. The employees' wages will still be liable to Income tax and national insurance, as well as automatic enrolment contributions.

If your employee does not wish to go on furlough, then redundancy or termination of employment can follow.

Eligibility for the scheme

Any UK organisation with employees can apply, including

  • Businesses
  • Charities
  • Recruitment agencies (agency workers paid through PAYE)
  • Public authorities

You must have created and started a PAYE payroll scheme on or before the 30 October 2020 and have a UK, Isle of Man or Channel Island bank account. Full details of the scheme can be found on the following link.

Check if you can claim for your employees' wages through the Coronavirus Job Retention Scheme - GOV.UK (www.gov.uk)

Employers can use a portal to claim for 80% of furloughed employees usually monthly wage costs, up to £2,500 a month. Fees, commission and bonuses should not be included.

An employer can choose to top up an employee's salary beyond this but is not obliged to under this scheme.

Full and part time employees

For employees on your payroll on or before the 19 March 2020, the pay to use for the job retention scheme calculation is 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 not on your payroll before the 19 March 2020, use the pay they received on or before the 30 October 2020. Fees, commission and bonuses should not be included.

Employees whose pay varies

If the employee has been employed for a full twelve months prior to the claim, then for those on your payroll on or before the 19 March 2020, you can claim the higher of either:

  • The same months earnings from the previous year
  • Average monthly earnings from the 2019/20 tax year.

If employed for less than twelve months, you can claim for an average of their monthly earnings since they started work. If they started in February 2020, use a pro-rata for their earnings so far to claim.

For employees not on your payroll before the 19 March 2020, use the earnings between 6th April 2020 or their start date (whichever is later) and day before their furlough starts.

The following link, details how much you can claim for most employees.

https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme#calc

Owner managed companies

This scheme is also available on the salaries paid to company directors under the Pay as You Earn Scheme. Details can be found on the following link.

https://www.icaew.com/insights/viewpoints-on-the-news/2020/apr-2020/sole-directors-and-the-coronavirus-job-retention-scheme

Employer National Insurance and Pension Contributions

All employers remain liable for associated Employer national Insurance contributions and minimum automatic enrolment employer pension contributions on behalf of their furloughed employees.

National Living Wage/National Minimum Wage

Furloughed workers, who are not working, must be paid the lower of 80% of their salary, or £2,500 even if, based on their usual working hours, this would be below the National Living Wage/National Minimum Wage.

To make a claim

The following details will be required.

  • Your PAYE 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 telephone number

Claims must be submitted as follows

Claim for furlough days in

Claim must be submitted by

November 2020

14 December 2020

December 2020

14 January 2021

January 2021

15 February 2021

February 2021

15 March 2021

March 2021

14 April 2021

April 2021

14 May 2021

Full details on the guidance can be found on the following links

https://www.gov.uk/guidance/steps-to-take-before-calculating-your-claim-using-the-coronavirus-job-retention-scheme

Lay-Offs and short time working

As an employer you can ask your staff to stay at home or take unpaid leave if there's not enough work. This is an area fraught with difficulty and would suggest you take legal advice before proceeding down this avenue. Further guidance can be found on the following website links:

https://www.gov.uk/lay-offs-short-timeworking

https://www.acas.org.uk/coronavirus

https://archive.acas.org.uk/index.aspx?articleid=3840

If you have taken out a tax fee protection insurance policy with us you may be eligible to receive complimentary expert telephone advice on employment law, HR and health and safety matters:

https://www.vantagefeeprotect.com/tax-fee-protection-advice-lines/

Support to create job placements: the kickstart scheme

This provides funding to employers to create job placements to employers to create job placements for 16-to-24-year olds on Universal credit. It is open to employers of all sizes, but an application must be for a minimum of 30 placements. If a single employer cannot provide this many placements, they can find a local authority, charity or trade body for help applying.

 The funding covers

  • 100% of the national Minimum wage for 25 hours per week for a total of six months.
  • Associated employer National Insurance Contributions
  • Employer minimum automatic enrolment contributions

Details can be found as follows.

Kickstart Scheme - GOV.UK (www.gov.uk)

Self Employed

Support for self-employed through the Self-employment Income Support Scheme (SEIS)

This scheme has also been extended and will support self-employed individuals, including members of a partnership, who have lost income due to Coronavirus. Those who were previously not eligible for the first and second grants will not be eligible for the third.

To claim the third grant, you must have had a new or continuing impact from coronavirus between the 1 November 2020 and 29 January 2021, which you reasonably believe will have a significant reduction in your profits. This third taxable grant is worth 80% of your average monthly trading profits paid out in a single instalment covering three months' worth of profits, and capped at £7,500.

As with the previous grants, H M Revenue & Customs will contact you if you are eligible. The eligibility criteria are the same as the first and second grants.

If you are eligible the claim for the third grant must be made on or before the 29 January 2021.

A fourth grant will be available covering the period February 2021 to April 2021, but details have yet to be announced.

H M Revenue & Customs will contact you if you are eligible for the scheme and then invite you to apply online through the GOV.UK site. The grant once claimed will be paid into your bank account within 6 working days.

To check if you are eligible, enter your Unique tax reference number followed by your National Insurance number, in the following link.

https://www.tax.service.gov.uk/self-employment-support/enter-unique-taxpayer-reference

To be eligible, you must have

  • Submitted your self-assessment tax return for the year ended 5 April 2019 and filed before the 23 April 2020.
  • Have traded in the current tax year 2019-20.
  • Are trading when you apply, or would be except for COVID-19.
  • Intend to trade in the tax year 2020/21.
  • Have lost trading/partnership profits due to COVID-19.
  • Your self-employed trading profits must be less than £50,000 and more than half of your income from self-employment. This is determined by one of the following conditions being true.
    • having trading profits/partnership trading profits in 2018/19 of less than £50,000 and these profits constitute more than half of your total taxable income.
    • Having average trading profits/partnership trading profits in 2016/17, 2017/18 and 2018/19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period.

If you started trading between 2016-19, HM Revenue & Customs will only use those years for which you filed a self-assessment tax return.

If successful, the grant will need to be disclosed on any claim for tax credits.

Details can be found on the following links.

https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

Previous advice for the self-employed has been noted below.

You are able to claim Universal Credit, providing you meet the usual eligibility criteria.

To support you with the economic impact of the outbreak and allow you to follow government guidance on self-isolation and social distancing, from 6 April the requirements of the Minimum Income Floor will be temporarily relaxed. This change will apply to all Universal Credit claimants and will last for the duration of the outbreak.

New claimants will not need to attend the jobcentre to demonstrate gainful self-employment.

Grants Available from Your Local Council, Known as Local Restrictions Support Grant (Closed), Additional Restrictions Grant and Christmas Support Payments for Pubs

There schemes are available for businesses that were closed by law and schemes for businesses that stayed open.

Local Restrictions Support Grant (Closed)

A grant may be available if your business stayed open between the 1 August and 5 November 2020 in a tier 2 or tier 3 local alert level. How much you get will be decided by your council but based on the rateable value of your property. Eligible businesses may be entitled to a cash grant from their local council for each 14-day period under local restrictions. The guidance is as follows;

Check if you're eligible for the coronavirus Local Restrictions Support Grant (for open businesses) - GOV.UK (www.gov.uk)

The link for Dorset County Council is as follows.

Coronavirus information for businesses and employers (dorsetcouncil.gov.uk)

Additional Restrictions Grant

Local councils have the freedom to determine the eligibility criteria for these grants, but which do not qualify for the Local Restrictions Support Grant (Closed). Details are as follows.

Additional Restrictions Grant (ARG) - Dorset Council

Christmas Support Payments for Pubs

If your pub is in Tier 2 or tier 3 between 2 December 2020 and 29 December 2020, you are based in England and less than 50% of your revenue is derived from food sales, then a grant of £1,000 may be available.

You must apply to your local authority before the 31 January 2021.

Christmas Support Payment (CSP) - Dorset Council

Business Rates

As previously announced there will be a business rates holiday for retail, hospitality, leisure and nursery businesses in England for the 2020 to 2021 tax year.

No action needs to be taken, as the local authority will reissue your bill automatically.

You can calculate the amount you will not have to pay, by following the attached link.

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

The guidance issued to the local authorities can be found via the following link.

https://www.gov.uk/government/publications/business-rates-retail-discount-guidance

Dorset Council has issued advice regarding business rates bills and the link is as follows.

https://www.dorsetcouncil.gov.uk/emergencies-severe-weather/emergencies/coronavirus/business-and-employers/coronavirus-business-support-grant-funding.aspx

Bounce Back Loans

Businesses can borrow between £2,000 and £50,000 and is subject to a cap of 25% of your turnover. The loans carry an interest rate of 2.5% with terms of up to six years. There are no repayments required or interest charged during the first 12 months of the loan. The loans can be repaid at any time with no early repayment charge. The loans are 100% backed by the Treasury and therefore you do not need to give the lender any security for the loan.

Before your first repayment is due the lender will contact you with options

  • to extend the term to 10 years
  • to move to interest only repayments for a period of 6 months
  • pause your repayments for 6 months, providing you have already made at least 6 repayments.

There are no repayments required or interest charged during the first 12 months of the loan. The loans can be repaid at any time with no early repayment charge. The loans are 100% backed by the Treasury and therefore you do not need to give the lender any security for the loan.

To be eligible, your business must be in the UK, established before the 1 March 2020 and have been adversely affected by the coronavirus.

The accredited lenders can be found by using the link below. A simple on-line application is completed.

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/current-accredited-lenders-and-partners

Any business which has taken out a Coronavirus Business Interruption Loan, detailed below, of less than £50,000 can convert the loan to a Bounce Back loan.

This scheme is open until the 31 March 2021.

Support for Businesses Through the Coronavirus Business Interruption Loan Scheme (CBILS) Formerly Known as The Enterprise Finance Guarantee (EFG)

This will be available to smaller businesses that are viable but unable to obtain finance due to having insufficient security to meet the lenders normal requirements. CBILS will provide the lender with a government backed 80% guarantee. The scheme is open until the 31 March 2021.

Loans of up to £5 million will be supported and businesses will be able to access the first 12 months of that finance interest free, as the government will cover the first 12 months of interest payments.

However, the borrower, always remain liable for 100% of the debt. The length of the loan, will depend on the facility applied for. Up to three years for overdrafts and invoice finance facilities and up to six years for loans and asset finance facilities.

To be eligible the small business must be

  • UK based.
  • Turnover of less than £45 million.
  • Operate within an eligible Industrial sector.
  • Have a borrowing proposal which if it were not for the current pandemic, would be considered viable by the lender.

Guidance on the British Business Bank can be found on the following website link:

https://www.british-business-bank.co.uk/ourpartners/supporting-business-loans-enterprise-finance-guarantee/

Support for larger Firms through the COVID-19 Corporate Financing Facility

Under the new COVID-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies. All UK businesses are eligible. The scheme was available in the week beginning the 23 March 2020 and will operate for at least 12 months. More information can be found at the following link.

https://www.gov.uk/guidance/apply-for-the-covid-19-corporate-financing-facility

If you cannot make tax payments

Self-Assessment tax payments

If you cannot pay your self-assessment tax bill, you can set up a payment plan to spread the cost of your bill if

  • You owe £30,000 or less
  • You do not have any other payment plans or debts with HMRC
  • Your tax returns are up to date
  • Its less than 60 days after the payment deadline.

Other taxes

If you cannot pay other taxes, you may be able to set up a Time to Pay arrangement, which lets you spread the cost of your tax bill by paying in instalments. If you have already received a demand, like a tax bill or letter threatening you with legal action, call the HMRC office that sent you the letter.

If you haven't received a bill or letter, call the Payment Support Service on 0300 200 3835 they are open Monday to Friday from 8am to 4pm.

VAT payments

The vat deferral scheme ended on the 30 June 2020. This deferred payments between the 20 March 2020 and 30 June 2020. These deferred payments were due to be paid by the 31 March 2021, but if you still have payments to make you can opt into a new payment scheme, which you must undertake rather than your agent. This will allow you to make the payment by making 11 smaller instalments, interest free but these must be paid by the end of March 2022. To be eligible you must

  • Still have deferred vat to pay
  • Be up to date with your vat return forms
  • Opt in before the end of march 2021
  • Pay the first instalment before the end of march 2021
  • Be able to pay the deferred vat by direct debit.

If you opt into this scheme, you can still have a time to pay arrangement for other HMRC debts and outstanding tax.

Guidance can be found as follows.

Pay VAT deferred due to coronavirus (COVID-19) - GOV.UK (www.gov.uk)

Ensure you have to hand the following.

  • Your reference number
  • The amount of the tax bill you're finding it difficult to pay and the reasons why.
  • What you have done to try to get the money to pay the bill.
  • How much you can pay immediately and how long you may need to pay the rest.
  • Your bank account details.

Commercial Insurance

Most commercial policies will not cover a pandemic or unspecified disease, such as Covid-19.

However, those businesses which have an insurance policy that covers government ordered closure and pandemics or government ordered closure and unspecified notifiable disease should be able to make a claim (subject to the terms of your policy). Businesses are therefore advised to check their policies. If businesses have policies with cover for “unspecified notifiable diseases” then a claim may be able to be made.

Protection from Eviction for Commercial Clients

Commercial tenants in England, Wales and Northern Ireland who cannot pay their rent because of COVID-19 will be protected from eviction. These measures will mean no business will automatically forfeit their lease and be forced out of their premises if they miss a payment before the 31 March 2021.

This is not a rental holiday; commercial tenants will still be liable for the rent.

The following businesses must remain closed

The businesses which must remain closed are detailed in the following link.

Closing certain businesses and venues in England - GOV.UK (www.gov.uk)

Guidance for UK businesses trading internationally

Advice for UK businesses that export or deliver goods and services abroad has been issued. The Department for International Trade can support businesses by providing assistance with Customs authorities to ensure smooth clearance of their products and offering advice on intellectual property and other issues with business continuity. Details can be found on the following link.

https://www.gov.uk/government/publications/coronavirus-covid-19-guidance-for-uk-businesses/coronavirus-covid-19-guidance-for-uk-businesses-trading-internationally

Companies House Filing Extension

Businesses will be given an additional 3 months to file accounts with Companies House to help companies avoid penalties

Guidance for Residential Landlords and Tenants

The Government's guidance for residential landlords and tenants can be found at the following link:

Guidance for landlords and tenants - GOV.UK (www.gov.uk)

Further useful information can be obtained from the Residential Landlords' Association:

https://www.rla.org.uk/