Coronavirus Business Support Summary

There is so much for Businesses at the moment with regards to what support is available to them as employers and also to them as a business that I thought I would just put it all into a summary – linking to some of my previous posts. I will ensure this is always up to date with the latest information.

We will look at

• Job Retention Scheme
• Statutory Sick Pay Rebate Scheme
• Deferral of VAT
• Deferral of Self Assessment
• Business Rates Relief
• Business Support Grant Funds
• Support for the self-employed
• Coronavirus Business Interruption Loan Scheme
• Coronavirus Future Fund
• Coronavirus Bounce Back Loan – NEW 28th April 2020
• Supporting Employees
• Business and Tax Credits Update

Coronavirus Job Retention Scheme

Employers can now claim online for a grant for 80% of your furloughed employees’ salaries up to a maximum of ￡2,500 per employee per month. This scheme will be open until the end of June at the moment.

Read my specific blog on the Job Retention Scheme.

It is important to note that if your employee is taking on a job during furlough such as farming that is with a different employer ensure that they are completing the New Starter Checklist Correctly so that they don’t’ get overtaxed.

COVID-19 Statutory Sick Pay Rebate Scheme

The government has agreed to pay the first 14 days of sick pay (waiving the 3 waiting days) for anyone that is self-isolating, having to shield or actually gets the COVID-19. At the moment the HRMC are urgently working to set up a system to be able to claim this back.

In the meantime, ensure that you are keeping accurate records – now might be the ideal time to look at a really simple HR System to help you with these reports – take a look at Breathe.

Deferral of VAT Payments

On the 20th March 2020, it was announced that VAT payments due between 20th March and 30th June 2020 could be deferred to help with cash flow.

You have until the 31st of March 2021 to pay any deferred VAT, but you must continue to submit VAT returns during this period on time.

You don’t need to apply for this if you have a Direct Debit set up just cancel it.

Deferral of Self-Assessment Payment

You can delay making your second payment on the account but it has to be paid by 31st January 2021.

If you prefer to pay regularly throughout the year you can use the budget payment plan

Make sure if you are deferring anything that you plan how you will pay it back later on and have a plan!

Business Rates Relief

You don’t need to do and anything although if your local council has not contacted you and you are still paying and you think you are eligible then go to their website and contact them.

Business Support Grant Funds

Please see the below guidance document that has been completed to help you with the details on this funding stream.

Grant Funding Scheme

Support for the Self-Employed

If you are self-employed you are now edible to claim a grant if you are self-employed or a member of a partnership in the UK and have lost income due to coronavirus.

You will be able to claim online but this service is not available yet but is said to be available to apply from mid-May and payments will be made by early June.

Similar to the Job Retention Scheme you are able to claim a taxable grant worth 80% of your trading profits up to a maximum of ￡2500 a month. This is currently available for 3 months but might be extended.

You can claim Universal Credit while you wait for the grant you will just need to declare this when you make the claim.

If you receive the grant you CAN continue to work or take on other employment including voluntary work.

Who can claim 

You can claim if you’re a self-employed individual or a member of a partnership and you:

• have submitted your Self Assessment tax return for the tax year 2018 to 2019
• traded in the tax year 2019 to 2020
• are trading when you apply, or would be except for coronavirus
• intend to continue to trade in the tax year 2020 to 2021
• have lost trading profits due to coronavirus

You will need to confirm to HMRC that your business has been adversely affected by coronavirus. HMRC will as usual use a risk-based approach to compliance.

Your trading profits must also be no more than ￡50,000 and more than half of your total income for either:

• the tax year 2018 to 2019
• the average of the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019

If you have not submitted Self Assessment tax returns for all 3 years find out how the HRMC will work out your eligibility.

Business Interruption Loan Scheme

This is available for small – medium-sized businesses who need to access finance up to ￡5 million.

Eligibility

You’re eligible if:

• your business is based in the UK
• your business has an annual turnover of up to ￡45 million
• your business has a borrowing proposal which the lender would consider viable, if not for the coronavirus pandemic
• you can self-certify that your business has been adversely impacted by the coronavirus

Click here to see how to apply

Future Fund

This is a convertible loan between ￡125,000 and ￡5 million to innovative companies who are facing financial difficulties due to the pandemic.

The scheme will be launched in May 2020.

The basis is that you need to have matched funding by private investors.

I will update as soon as I know more details.

Bounce Back Loan – Launching 4th May 2020

This is available to small and medium-sized businesses affected by COVID-19 to apply for loans up to ￡50,000.

This is 100% guaranteed by the government and there won’t be any fees or interest to pay for the first 12 months.

Eligibility

You are eligible if:

• is based in the UK
• has been negatively affected by coronavirus
• was not an ‘undertaking in difficulty’ on 31 December 2019
• you are not already claiming the Business Interruption Loan Scheme

As soon as I know more about how to claim I will update this blog.

Supporting Employees

Unless you are furloughed an employee, the following applies to any staff home-working due to COVID-19, either because their workplace is closed or they have been advised to self-isolate.

Speak to your accountant as the Tax treatment will be different depending upon whether you provide these things for employees or reimburse purchases made by your staff.

• Mobile Phones and SIM cards (no restriction on private use) – this is limited to 1 per employee.
• Broadband – If an employee already pays for broadband, then no additional expense can be claimed. However, if a broadband internet connection is needed to work from home where one was not available previously then the broadband fee can be reimbursed by the employer and is non-taxable, as long as the broadband is provided for business and andy private use is kept to a minimum,
• Additional expenses such as electricity, heating and broadband – Payment or reimbursement to employees of up to ￡6 a week (￡4 a week to 6 April 2020) is non-taxable for the additional household expenses incurred when an employee is required to work from home. Receipts will need to be provided if a claim is above this amount. Employees should check with their employers beforehand as to whether employers will be making these payments.
• Employer-provided loans – A salary advance or loan to help an employee at a time of hardship counts as an employment-related loan. Loans provided with a value less than ￡10,000 in a tax year are non-taxable. Speak to your accountant if you are considering this.

Remember any taxable Benefits should be reported to the HRMC on the employees P11D if you don’t currently put them through payroll as a benefit in kind.

Benefits and Tax Credits Update

Can you please let your employees know about the following information:

Benefits and Tax Credits Uprating

As part of a number of measures to support the country during the coronavirus (COVID-19) pandemic, the basic element of Working Tax Credit has been increased by ￡1,045 to ￡3,040 from 6 April 2020 until 5 April 2021.

The amount a claimant or household will benefit from will depend on their circumstances, including their level of household income. But the increase could mean up to an extra ￡20 each week. The government is also uprating Child Benefit, other tax credits rates and thresholds, and Guardian’s Allowance by 1.7% with effect from 6 April 2020. You can read the full list of Rates and Allowances.

These increases came into effect on the 6 April, but individual payment dates will vary depending on circumstances. You don’t have to take any action and you will receive any increased payments automatically. Use the tax credits calculator to get an estimate of how much you could get in tax credits in a 4-week period.

Tax Credit Renewal

This year, HMRC will automatically renew all tax credits claims apart from those identified as high risk. This means that around 3.9 million customers will have their claim automatically renewed. These customers will receive an auto-renewal pack and they will only need to contact us if their details differ from the pack. We will need more information from 150,000 customers and they will be sent a reply required renewal pack and will be expected to complete it in the normal way. Please be aware, if you are currently a tax credit claimant and you claim Universal Credit, your tax credit award will be closed from the day before your Universal Credit claim is made. Once you have made a Universal Credit claim it is not possible to revert back to tax credits.

More guidance is available on GOV.UK.

What We Still Don’t Know

Support for those that rent – apart from that those that do rent cannot be evicted for 3 months that is all we know at the moment. The mortgage holiday has been agreed and it is being asked so if you are a tenant then speak to your landlord – remember this will end at some point.

How Kate Underwood HR Can Help You Today

If you are worried, have questions about this HR Coronavirus Update or just want to have a plan B, then please do get in touch.

Our office is now working remotely so that we can ensure we are here when you need us.

Stay safe and healthy out there!

Kate