SFB have summarised the latest news for UK businesses. To the best of our knowledge, at the time of us producing this document, all the information below is correct, however, we are aware that the COVID-19 coronavirus situation and the government reaction are evolving daily. Please feel free to call SFB to discuss any matter relating to coronavirus, we are doing all we can to help.
Please note that further COVID-19 assistance is available from https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses.
- HMRC will contact you directly if you are eligible for the Self-Employed COVID-19 support.
- If you believe you are eligible for the grant but haven’t heard anything from HMRC within the next 7 days, please contact us.
- Self-employed workers can apply for a grant worth 80% of their average monthly profits over the last three years.
- The grant will cover up to a maximum of £2,500 a month.
- The money will be backdated to March but not begin to arrive into your bank accounts from HMRC until the start of June at the earliest and will be paid in a single lump sum.
- To qualify for this grant, at least 50% of your income needs to have come from self-employment as registered on your 2018-19 tax return filed in January. If you missed the filing deadline, you can still qualify for this grant providing you submit it within the next four weeks.
- The scheme is open to those who earn under £50,000 a year and unlike the employee scheme, the self-employed can continue to work as they receive support.
- The grants must be declared on tax returns by January 2022 and are taxable.
- It appears that company owners who pay themselves a basic salary and a dividend are not covered in this support scheme.
Please let us know if you require our assistance with these grants.
There is still a huge amount of confusion for directors of companies. When we know more we will communicate with you.
If anyone has any queries about universal credit, please call SFB as we can provide general advice.
Coronavirus Job Retention Scheme (Furlough)
- The Furlough scheme is available to all UK employers to access support to continue paying part of their employees’ salary for employees that would otherwise have been laid off during this crisis.
- The scheme will be in place for three months initially.
- We understand the salary subsidy will be claimed through a new HMRC portal system.
- This will enable a reimbursement of 80% of furloughed workers wage costs, up to a cap of £2,500 per month.
- We believe the system will be ready from April 2020 and payments must be made by the business themselves up to this date.
Who can you place on Furlough?
- All UK organisations with employees can apply, including:
- Public authorities and recruitment agencies
- You must have created and started a PAYE payroll scheme on or before 28 February 2020 and have a UK bank account.
- Furloughed employees must have been on your PAYE payroll on 28 February 2020, and can be on any type of contract, including:
- full-time employees
- part-time employees
- employees on agency contracts
- employees on flexible or zero-hour contracts
- The scheme also covers employees who were made redundant since 28 February 2020, if they are rehired by their employer.
- This scheme is only for employees on agency contracts who are not working.
Who can you not place on Furlough?
- If an employee is working, but on reduced hours, or for reduced pay, they will not be eligible for this scheme and you will have to continue paying the employee through your payroll and pay their salary subject to the terms of the employment contract you agreed.
- Employees hired after 28 February 2020 cannot be furloughed or claimed for in accordance with this scheme.
- Employees on unpaid leave cannot be furloughed, unless they were placed on unpaid leave after 28 February.
What rules apply?
- To be eligible for the subsidy, when on furlough, an employee can not undertake work for or on behalf of the organisation. This includes providing services or generating revenue. While on furlough, the employee’s wage will be subject to usual income tax and other deductions.
- When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.
- To be eligible for the subsidy employers should write to their employee confirming that they have been furloughed and keep a record of this communication.
- You do not need to place all your employees on furlough. However, those employees who you do place on furlough cannot undertake work for you.
Employees On Statutory Sick Pay
- Employees on sick leave or self-isolating should get Statutory Sick Pay, but can be furloughed after this.
- Employees who are shielding in line with public health guidance can be placed on furlough.
- If your employee has more than one employer they can be furloughed for each job. Each job is separate, and the cap applies to each employer individually.
Volunteer Work Or Training
- A furloughed employee can take part in volunteer work or training, as long as it does not provide services to or generate revenue for, or on behalf of your organisation.
- However, if workers are required to for example, complete online training courses whilst they are furloughed, then they must be paid at least the NLW/NMW for the time spent training, even if this is more than the 80% of their wage that will be subsidised.
Maternity Leave And Parental Pay
- Individuals who are on or plan to take Maternity Leave must take at least 2 weeks off work (4 weeks if they work in a factory or workshop) immediately following the birth of their baby. This is a health and safety requirement. In practice, most women start their Maternity Leave before they give birth.
- If your employee is eligible for Statutory Maternity Pay (SMP) or Maternity Allowance, the normal rules apply, and they are entitled to claim up to 39 weeks of statutory pay or allowance.
- Employees who qualify for SMP, will still be eligible for 90% of their average weekly earnings in the first 6 weeks, followed by 33 weeks of pay paid at 90% of their average weekly earnings or the statutory flat rate (whichever is lower). The statutory flat rate is currently £148.68 a week, rising to £151.20 a week from April 2020.
- If you offer enhanced (earnings related) contractual pay to women on Maternity Leave, this is included as wage costs that you can claim through the scheme.
- The same principles apply where your employee qualifies for contractual adoption, paternity or shared parental pay.
If you need assistance please contact us.
- Any VAT up to 30th June 2020 does not have to be paid until 5th April 2021.
- If you normally pay by direct debit we advise you to cancel your direct debit with your bank if you 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.
- We recommend that VAT returns are submitted as normal.
- If you are due a VAT refund, this will still be repaid to you as normal.
Personal Income Tax
- The government have stated there is no interest or penalties for late payment of Income Tax.
- The self-assessment 31st July 2020 payments will be due with your 31st January 2021 payment.
- If you are already in a HMRC Time To Pay (TTP) arrangement, SFB can re-negotiate the terms. Please let us know if you require our assistance with this.
Time To Pay (TTP)
- In regards of your Corporation Tax and PAYE, if you need to set up a HMRC Time To Pay (TTP) arrangement or are already in a TTP, SFB can re-negotiate the terms. Please let us know if you require our assistance with this.
Statutory Sick Pay
- The government are setting up a rebate scheme and it is still being developed. SFB will keep you updated with all schemes and relevant information announced.
- If you are not able to go to work and have to self-isolate, you are entitled to 14 days statutory sick pay.
Local Authorities Business Rates
- The local authorities will be contacting you regarding your business rates.
- In the meantime, do not cancel your standing order and direct debits.
- Additionally, your local authority will write to you if you are eligible for the Coronavirus support grants.
Coronavirus Business Interruption Loan Scheme (CBILS)
- All major banks will offer the scheme once it is launched.
- You should talk to your bank manager as quickly as possible.
- We understand you will need to discuss your business plan with them to ensure the CBILS are obtained as quickly as possible.
Speak to us now to speed the process up for when the schemes are ready.
- So far, we have not seen any official communication from the government regarding corporation tax. Therefore, we can only assume payments will become due as normal. However, if you believe you are going to struggle to pay this, please call SFB and we will assist with negotiating TTP arrangements for you.
- The government announced that Buy-To-Let borrowers will be eligible for a payment holiday of up to three months if their tenants have lost income due to the impact of COVID-19.
Coronavirus Related Scams
- Unfortunately, during the uncertainty of the COVID-19 situation, scam artists have seen this as an opportunity. There has been a large increase in phishing scams, such as text messages asking you to make a donation to the NHS, or emails asking for your bank details so you can receive the furlough and self-employed help grants.
- You should never submit your bank details or make payments until you have confirmed the source of the phone call/text message/email.
If you are uncertain of a request you believe to be a scam, SFB are happy to provide confirmation where we can for you.
This post consists of generic advice based on our current knowledge of the COVID-19 situation. As this is changing daily, the above should be read as guidance only. Further assistance is available from https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses. Please contact us directly regarding any of the matters in this post you wish to discuss in further detail.