Important Information

Visit our important information page regularly to ensure you get the very latest important information from the Government during the current Coronavirus COVID-19 pandemic.

We will update this page as soon as we get clarity from the Government concerning all accounting matters: VAT, Income Tax, Business Rates etc.

LW Accountants are still contactable via our Email info@lwaccountants.co.uk.


If the information on this page doesn't change regularly on your browser either press the "Refresh" button in your browser or press the CTRL button and the F5 key together to force an refresh.

Whilst we are hoping to keep our office open, this will be subject to Government advice.

We will be not be meeting with clients and have organised a 'drop off' arrangement for books and records at the entrance to the office, so far this has worked well for those of you that have used it.

We will continue to update this information as regularly as possible, this is a summary of the advice from HMRC

Self Employed

The Chancellor announced an extension to the Self Employed Income Support Scheme on 29 May 2020

This is a link to the current criteria HMRC have set for the grant.  You are allowed to continue to work and still make a claim.  You can also make a claim for Universal Credit if you are experiencing a reduction in your income.

Individuals can continue to apply for the first SEISS grant until 13 July 2020.  Under the first grant, eligible individuals can claim a taxable grant worth 80% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total.  Those eligible have the money paid into their bank account within six working days of completing a claim.

Applications for the second grant will open in August 2020.  Individuals will be able to claim a second taxable grant worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.

The eligibility criteria are the same for both grants, and individuals will need to confirm that their business has been adversely affected by coronavirus.  An individual does not need to have claimed the first grant to receive the second grant: for example, they may only have been adversely affected by COVID-19 in this later phase.  Further guidance on the second grant will be published on Friday 12 June 2020.

If your annual average profits are over £50,000, you will not qualify for the grant.  Nor will you qualify if you have not yet submitted a Tax Return because you commenced self employment after 6th April 2019.  Under these circumstances the current options are to claim Universal Credit and/or Employment and Support Allowance

Employers

Under the Coronavirus Job Retention Scheme, all UK employers with a PAYE scheme will be able to access support to continue paying part of their employees' salary for those that would otherwise have been laid off during this crisis.

On 29th May 2020 the Chancellor announced the forthcoming changes to the Coronavirus Job Retention Scheme (CJRS) and we have set out below how and when these will affect anyone using the furlough scheme.
 

From 1st June 2020

The Coronavirus Job Retention Scheme will continue without any changes to the current rules.

From 1st‌‌ July 2020

The employer will have the flexibility to bring previously furloughed employees back to work part-time, with the government continuing to pay 80% of wages for any of their normal hours they do not work up until the end of August 2020.  This flexibility comes a month earlier than previously announced to help people get back to work.

You can decide the hours and shift patterns that your employees will work on their return and you will be responsible for paying their wages in full while working.  This means that employees can work as much or as little as your business needs, with no minimum time that you can furlough staff for.

Any working hours arrangement that you agree with your employee must cover at least one week and be confirmed to the employee in writing.

If your employees are unable to return to work, or you do not have work for them to do, they can remain on furlough and you can continue to claim the grant for their full hours under the existing rules.

From 1st August 2020

The government will continue to pay 80% of wages up to a cap of £2,500 per month, but employers will now need to pay any employer’s National Insurance contributions and employer Pension contributions.  But please note that the cap on the furlough grant will be proportional to the hours not worked if employees have returned part-time during the payment period.

From 1st September 2020

The government will pay 70% of wages up to a cap of £2,187.50 per month for the hours the employee does not work.  Employers will continue to pay any employer’s National Insurance contributions and employer Pension contributions due plus they will now be liable to pay 10% of an employee’s wages to make up 80% of the total up to a cap of £2,500.  Again, the cap on the furlough grant will be proportional to the hours not worked if employees have returned part-time during the payment period.

From 1st October 2020

The government will pay 60% of wages up to a cap of £1,875 per month for the hours the employee does not work Employers will continue to pay any employer’s National Insurance contributions and employer Pension contributions due plus they will now be liable to pay 20% of an employee’s wages to make up 80% of the total up to a cap of £2,500.  Again, the cap on the furlough grant will be proportional to the hours not worked if employees have returned part-time during the payment period.

New entrants to the CJRS

It is important to note that the scheme will close to new entrants from 30‌‌ June 2020. From this point onwards, you will only be able to furlough employees that you have previously furloughed for a full three-week period prior to 30‌‌ June 2020.

This means that the final date that you can furlough an employee for the first time will be 10‌‌ June 2020 for the current three-week furlough period to be completed by 30‌‌ June 2020.

VAT payments

You must still complete and submit your VAT Return by the usual relevant date.  However, some payments may now be deferred.  This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during the period 20 March 2020 to 30 June 2020. Taxpayers will be given until 31 March 2021 to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.
Customers who normally pay by direct debit should cancel their direct debit with their bank if they are unable to pay. Please do so in sufficient time so that HMRC do not attempt to automatically collect on receipt of your VAT return.

Income Tax payments

Income Tax Self-Assessment, payments due on the 31 July 2020 may be deferred until 31 January 2021. You are eligible if you are due to pay your second self-assessment payment on account on 31 July 2020. You do not need to be self-employed to be eligible for the deferment. The deferment is optional. If you are still able to pay your second payment on account on 31 July 2020, you should do so.

PAYE and Corporation Tax payments

There currently are no deferral payment periods for either of these taxes.  Payments are still expected on the normal due dates.  If you know you will be unable to make a payment at the correct time, you will need to contact HMRC (see below for details).

Business Rates

The government will provide Small Business Grant Scheme 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 will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

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. Businesses in these sectors with a property that has a rateable value of up to £15,000 will receive a grant of £10,000. Businesses in these sectors with a property that has a rateable value of between £15,000 and less than £51,000 will receive a grant of £25,000.

You do not need to do anything. Your local authority should contact you if you are eligible for this grant, but our experience is that you should look at your Local Authority's website for ways to make the claim. 

On 1st May 2020 The Local Authority Discretionary Grant Fund was announced, which allowed the Authority to make grant payments to bsuinesses who rented a property, but did not have their own business rates bill (for example market traders or those in shared/flexible work spaces) - details are to follow.

Business loans

The temporary Coronavirus Business Interruption Loan Scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.
The government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.
The government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The scheme will be delivered through commercial lenders, backed by the government-owned British Business Bank.

From 4th May 2020 you can apply for a Business Bounce Bank loan, which can be between £2,000 up to £50,000 (or 25% of your turnover if that is lower.  It is 100% backed by the Government, the first year is interest and repayment free and repayments start on month 13 for up to 5 years.  The interest rate is fixed at 2.5% for the term of the loan and therre are no early repayment penalties or set up fees.

Time to pay

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. 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

 

 

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