Guiding you through the COVID-19 crisis

The UK Government has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19. This page will be updated regularly, covering the announcements and crucially, providing direct advice on how to access the support. We will also be providing some useful advice to help you balance working from home, with running a business and continuing to support your employees. A full list of the current measures announced by the Government can be found here:


Latest Headlines:

**25.03.20 – The Chancellor announces Self-employment Income Support Scheme (SEISS)**

**27.03.20 – £10k and £25k Small Business grant applications open on Local Authority websites **

**27.03.20 – Further detail and clarification on the Job Retention Scheme and ‘Furloughing’ released**

**25.03.20 – Businesses able to apply for an additional 3 months to file accounts **

**23.03.20 – The Business Interruption Loan Scheme is Live. Contact Your Bank Directly**

**23.03.20 – The ICAEW is urging firms to keep track of any losses resulting from the Covid-19 crisis to ensure they can claim maximum reliefs **

**23.03.20 – VAT and Self-Assessment Payment on Account have both been deferred/delayed**

Full details and relevant links to individual announcements can be found below:


Key points and actions for:

Businesses / Employers:

  • Apply for £10k and £25k Small Business rates linked grants via your rates collecting authority website
  • VAT payments due for the period to 30th June have been delayed until the end of the tax year 2020-2021 but returns must still be filed
  • PAYE remains payable, but you can apply for time-to-pay
  • Year-end accounts and tax returns must still be filed but businesses can apply for an additional 3 months to file accounts
  • Job retention scheme – runs from 01.03.20.
  • Business interruption loan scheme went live on 23.03.20
  • SSP eligibility changes – New legislation will allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
  • Keep track of any losses resulting from Covid-19 crisis

Employees / Individuals

  • 3-Month Mortgage holidays are available for those most in need but bear in mind it might take 10 days to change a DD. This is not 3 free months and interest will continue to accrue during the holiday period
  • Private landlords are now eligible for a 3 month buy-to-let mortgage holiday if their tenants are experiencing financial difficulties. Individuals should speak to lenders at the earliest opportunity if they think they may be affected.
  • Loans- speak to the lender about capital (& Interest) repayment holiday
  • Credit cards – reduce repayments to the minimum payment period but be aware that interest will continue to accrue on outstanding amounts
  • Most local councils are offering to defer council tax payments for those in financial difficulty, as are most water and energy suppliers. Individuals should speak to their providers as early as possible to set up a deferral plan
  • HMRC confirms that the exceptional circumstances clause can be applied for UK residence tax

The Self-employed

  • The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19. The scheme will provide a grant to self-employed individuals, worth 80% of their profits up to a cap of £2,500 per month for the next 3 months.
  • If you currently make payments on account to HMRC, there is now no requirement for you to make your second payment on account for the 2019/20 tax year (due on 31 July 2020). The due date will instead be deferred to 31 January 2021. You will need to make sure you are setting aside enough tax throughout the year to cover the liability
  • Those with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. Call HMRC on 0800 0159 559

Self-employment Income Support Scheme

The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19. The scheme will provide a grant to self-employed individuals, worth 80% of their profits up to a cap of £2,500 per month for the next 3 months.

The scheme only applies to those individuals who:

  • have submitted an Income Tax Self-Assessment tax return for the tax year 2018-19
  • traded in the tax year 2019-20
  • are trading at the time of applying, or would be if not for COVID-19
  • intend to continue to trade in the tax year 2020-21, and
  • have lost trading/partnership trading profits due to COVID-19.

An individual’s self-employed trading profits must also be less than £50,000, and more than 50% of their total taxable income must be from the self-employment trade. This is determined by at least 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 50% of total taxable income.
  • having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than 50% of average taxable income across the same period.

If you started trading between 2016/17 and 2018/19, HMRC will only use those years for which you filed a Self-Assessment tax return to determine eligibility.

HMRC will contact you if you are eligible for the scheme and invite you to apply online. There is no facility to apply for the scheme directly yet.


Exceptional circumstances confirmed for UK residence test

An individual’s residence in the UK for tax purposes is determined by a statutory residence test and the number of days spent in the UK is a key factor. The rules for counting days take account of situations where an individual’s presence in the UK is due to exceptional circumstances beyond their control.

**HMRC has confirmed that the exceptional circumstances clause can be applied for any individual case where the pandemic has caused difficulties**

Do bear in mind, the 60 day annual limit will otherwise continue to apply.

Businesses can apply for an additional 3 months to file accounts

A joint initiative between the government and Companies House means that businesses will, from today (25.03.20), be able to apply for an additional 3 months to file accounts. The move is designed to help companies avoid penalties as they deal with the impact of COVID-19. As part of the agreed measures, those citing issues around COVID-19 will be automatically and immediately granted an extension.

The application needs to be completed online via the Companies House online filing system.

However, companies that have already extended their filing deadline, or shortened their accounting reference period, may not be eligible for an extension.

We would strongly recommend that all companies keep reporting on time where possible and we will make every effort to support you in this regard.


Job Retention Scheme

On Friday 20th March 2020, The Chancellor announced that UK employers will be able to apply for funding of 80% of PAYE salaries for workers who would otherwise have been laid off due to the virus, up to a cap of £2,500/month per employee.

Application will be via a new online portal, which HMRC is urgently working to get set up. There will be a delay before the portal is live and the funding is readily available. The Chancellor is recommending that businesses should work with employees to make other arrangements in the interim, wherever possible. The funding is being back dated to March 1st. The portal will undoubtedly be extremely busy on launch

On 26th March 2020 HMRC provided further detail and clarification on the Job Retention Scheme. Click here to find out more.

How to access the scheme

You will need to:

  • designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
  • submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.

As things stand, employment taxes continue to accrue in the normal way. It is not clear whether the £2,500 payment will count towards Employers National Insurance.

On 26th March 2020 HMRC provided further detail and clarification on the Job Retention Scheme. Click here to find out more.

A link to the application portal will appear here as soon as it is launched


VAT Payments Suspended Until June 2020

VAT payments normally due during the next 3 months can be deferred until the end of the 2020/21 tax year. This will apply to liabilities due for the quarters ending 29 February (due 7 April), 31 March (due 7 May) and 30 April (due 7 June).

No application is required. At this stage, returns are still required, it is only the payments which have the deferment. HMRC is simply not chasing any payments for which the above applies and will not be applying any interest or penalties on late VAT payments.

Please note this is available as a deferment of the VAT due ONLY, the liability will still need to be paid eventually. If you can still pay, we would recommend doing so.

Self-Assessment PoA Deferred to 31.01.21

Self Assessment payment on account due 31 July will be deferred until 31 January 2021. 

No application is required by any individual wishing to take advantage. HMRC is simply not chasing any payments for which the above applies.

Please note this is a deferment ONLY.


Private rental mortgage holiday and pause on new eviction proceedings

Landlords in England and Wales will not be able to start new eviction proceedings for at least the next 3 months, protecting private and social tenants.

Private landlords are also now eligible for a 3 month buy-to-let mortgage payment holiday if their tenants are experiencing financial difficulties. Individuals should speak to lenders at the earliest opportunity if they think they may be affected. For those agreeing a payment holiday, no mortgage payments would be due for the next 3 months and the total amount owed for this period would be spread out across all future payments, so there would be a very small uplift in future payments.


Claiming Small Business Grants

The Chancellor initially announced small business grant funding of £3,000 for all businesses in receipt of small business rate relief or rural rate relief. This was subsequently increased to £10,000 for qualifying businesses.

**Applications are now open and should be made via your business rates collecting authority website**

In order to complete your application, you will need:

  • Your company bank account details
  • Your VAT number
  • Local authority rates account number
  • Property reference number as shown on the most recent rates bill
  • Your company registration details
  • You company name
  • Details of what your business does
  • Exact address of the rateable property

IR35 Private Sector Rollout Postponed

On 17th March Chief Secretary to the Treasury, Steve Barclay, announced that the extension of the more rigorous compliance regime for the IR35 rules to the private sector will now be delayed until 6 April 2021.

This announcement comes less than a week after Chancellor Rishi Sunak confirmed in his budget that the new regime would apply to the private sector from 6 April 2020. 


Business Interruption Loan Scheme

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks will offer the Scheme once it has launched. There are 40 accredited providers in all.

You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

The scheme is now open. Contact your bank directly.


Business rates holiday for retail, hospitality and leisure businesses

There will be a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.

Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.

There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

Check Premises Insurance

Company owners should check premises insurance cover if offices/buildings are left empty for any period.

What are your duties under the policy?

Do you need to ensure regular checks?


Support for Businesses and the Self-employed paying tax

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline:

0800 0159 559


Future Relief?

Businesses must keep track of losses resulting from coronavirus to ensure they can claim maximum reliefs and survive the pandemic, says the Institute of Chartered Accountants in England and Wales (ICAEW). The faculty is urging firms to keep track of any losses accumulated as a result of COVID-19 and to take action to find out what reliefs are available to them

  • Lost business
  • Sickness payments
  • Lost income – e.g. rents
  • Exceptional payments & costs

Cash grants for retail, hospitality and leisure businesses

A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.

**Applications are now open and should be made via your business rates collecting authority website**


Free resources for home schooling

Juggling business and children? A number of online providers have removed the payment gateway on educational materials for parents/teachers/children.

www.senecalearning.com

www.bbc.co.uk/bitesize

www.twinkl.co.uk (using code UKTWINKLHELPS)

www.corbettmaths.com

Continue Tax Planning

Even in volatile times like these and with market turmoil, maximising your tax allowances continues to make financial sense. So, with under 3 weeks to go before the end of the tax year, it could be a good idea to make the most of your ISA and SIPP allowances before you miss out.

Here is a reminder of some of the reliefs available in the run up to 5th April:

  • Secure your valuable £20,000 income and capital gains tax-free ISA allowance.
  • Make use of any remaining pension allowance (up to £40,000 for this tax year). You will get a 20% tax relief boost (increasing up to 60% for higher earners) on any contributions you make.
  • Check to see if you could ‘carry forward’ any unused pension annual allowances from the previous three tax years.
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