COVID19 Support

YFT has collated information to support businesses and individuals through the current Corona outbreak. We know this is an extremely stressful time for business owners so want to share what we know and offer some practical advice on how to access the support available. We are monitoring conditions closely and will update this page as we know more.

Cashflow Forecasting and FREE cashflow forecast template

We have produced a simple cashflow forecast template for you to look at your companies cash position over the next few months.

We would really recommend that you have this in place and update it as conditions change Please note that the model is suitable for small non vat registered businesses if you require more detailed planning and need our help please get in touch.

Download:  Cashflow Forecast Template (XLSX)

Fraud

Unfortunately, we are seeing more activity from fraudsters trying to take advantage of the current situation.

 

HMRC Fraud

If you get any emails, texts or phone calls  purporting to be from HMRC that are asking you to take action, for example enter your bank details for a refund, please do not respond. If you are in any doubt refer the email to us or contact HMRC directly phishing@hmrc.gov.uk

HMRC will never send notifications by email about tax rebates or refunds. Do not:

  • visit the website
  • open any attachments
  • disclose any personal or payment information

Fraudsters may spoof a genuine email address or change the ‘display name’ to make it appear genuine. If you are unsure delete it.

Xero

Be careful of fake invoices, this is where you receive a fraudulent invoice that looks genuine  – here is the link with details of how these frauds work

https://www.xero.com/blog/2017/03/email-fraud-protect-business/

Job Retention scheme: Furlough Guidance

Proposed changes to the CJRS

On 29 May, Rishi Sunak outlined how the government plans to reshape the CJRS from 1 July to encourage those furloughed back into work. These proposed changes include:

  • Allowing furloughed employees to come back to work on a flexible part-time basis.
  • Employers covering the costs of the working hours of part-furloughed staff.

To make a claim under CJRS V2 employers must have submitted a claim under the existing version of the scheme before 1 July and only employees who have been included in claim in the first iteration of the scheme can be eligible for furlough under CJRS V2. This means that employees must have started their furlough by 10 June. As of 1 July, there will also be a maximum number of employees that can be claimed for – the maximum number on any single claim under CRJS V1.

What you need to know

Who can claim: Any employer with a UK PAYE scheme and a UK bank account.

How much can be claimed: A grant of 80% of furloughed employees’ pay up to a maximum of £2,500 per month, plus employers national insurance and auto-enrolled pension contributions.

For employees on a regular salary, the grant is based on the employee’s gross salary in the last pay period before 19 March 2020 (salary as at 28 February 2020 can also be used). If the employee has not been paid for a full pay period up to 19 March 2020 the earnings should be pro-rated to establish the base. For employees on variable pay who have been employed for more than 12 months the base pay is the higher of the same month’s earnings from the previous year and the average monthly earnings for the tax year 2019/20. If the employee has been employed for less than 12 months the base pay is the average monthly earnings since they started work. Discretionary payments, where there is no contractual obligation, cannot be included when calculating the grant.

How long does the scheme run: From 1 March 2020 until 31 October 2020 – the scheme will change after 30 June.

From July, employers currently using the scheme will have more flexibility to bring their furloughed employees back to work part time while still receiving support from the scheme.

This revised scheme will run for three months from July through to the end of October. Employers will be asked to pay a percentage towards the salaries of their furloughed staff. The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month. More specific details and information around its implementation will be made available by the end of May.

Which employees can be claimed for: Employees who were on payroll (ie on an RTI report) as of 19 March 2020, and have been put on furlough. This can include: domestic employees such as nannies, company directors, agency workers, employees on fixed term or zero hours contracts, foreign nationals (on any type of visa), contingent employees in the public sector and members of limited liability partnerships.

HMRC accepts that assigned or seconded employees who are included by an employer within a normal, appendix 6, or dedicated expatriate PAYE scheme, are employees of the UK entity for the purposes of the CJRS. So long as the UK entity is the employer it doesn’t matter who physically pays the employee. HMRC’s view is that businesses should only access the scheme in order to maintain their current workforce and if the UK employer can continue to recharge costs to an overseas entity it is not eligible to claim for those employees.

What does furlough mean: Employees on furlough cannot do any work for the organisation. The further Treasury Direction under Sections 71 and 76 of the Coronavirus Act 2020 published on 22 May emphasises that the training activities a furloughed employee can undertake while on furlough must not provide a service to the employer, nor can they contribute to the business activities or generate income or profit for the employer. They must however be relevant to the employee’s employment. Employees can continue, or start, to work or to volunteer for unconnected organisations.

How much do I have to pay the employee: The employee must be paid in accordance with their employment contract (which may be amended by agreement) and they retain their usual rights at work. The employee much be paid at least as much as the gross pay element of the grant received from HMRC but the grant is based on pay in the base period and so will not necessarily match the employee’s gross pay. Minimum wage rules do not apply when an employee is on furlough, other than in respect of hours when they are undertaking training.

When will grants be paid: Within six working days of a claim being submitted.

Is there a deadline for claims: There is currently no deadline for claims but it is advisable to make claims promptly as the scheme is expected to change from 1 August. ICAEW does not know which employees will be eligible, but it may be available only for employees that have already been furloughed.

How long do staff have to be furloughed: Three weeks minimum, although this can be extended.

Key dates

Start date: 1 March 2020

End date: 31 October 2020 – the scheme will change after 30 June

Employees need to be on payroll (ie on an RTI report) as of: 19 March 2020

Claims portal opened: 20 April 2020

How to apply

What data do you need?

  • UK bank account number and sort code (only provide bank account details where a BACS payment can be accepted).
  • Billing address for your bank account.
  • Employer PAYE scheme reference number.
  • The number of employees being furloughed.
  • Each employee’s national insurance number (see Requirement for a national insurance number if you have employees with no national insurance number).
  • Each employee’s payroll or employee number (optional).
  • The start date and end date of the claim.
  • The full amount you’re claiming for including employer national insurance contributions and employer minimum pension contributions.
  • Contact name and phone number for any queries.
  • Your name (or the employer’s name if you’re an agent).

Your corporation tax unique taxpayer reference, self-assessment unique taxpayer reference or company registration number (see Requirement for an SA UTR, CT UTR or CRN if you do not have any of these references)

Coronavirus Business Interruption Loan Scheme

The banks are starting to release details of what they are offering and the terms around these loans. Already there are very different terms being offered so we recommend that you shop around to find good deals. We cannot offer direct advice on which loans to take but if you need help contact us and we can you put you in touch with a brokerage firm that looks at different lenders. If you are looking for high value loans (over £1m) we can also put you in touch with a firm who specialises in finding these.

The temporary Coronavirus Business Interruption Loan Scheme supports small and medium-sized businesses with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to six 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 scheme will be delivered through commercial lenders, backed by the Government-owned British Business Bank.

There are 40 accredited lenders able to offer the scheme, including all the major banks.

Am I eligible?

You are eligible for the scheme if:

your business is UK based, with turnover of no more than £45 million per year

your business meets the other British Business Bank eligibility criteria

How do I access it?

You should apply via your lender’s website or through one of the 40 accredited finance providers offering the scheme (and not the British Business Bank).

Please note that branches may currently be shut down to enable social distancing.

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website.

Time to Pay – this is a scheme to help you if you cannot afford to pay your current taxes

What is it?

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.

Am I eligible?

You will be eligible if:

  1. Your business pays tax to the UK Government
  2. Your business has outstanding tax liabilities

How do I access it?

If you’ve missed, or are worried about missing, your next tax payment due to coronavirus, please contact HMRC. You can also call the HMRC helpline for advice on 0800 0159 559.

For more information on late payments, check with HMRC

If you’re worried about a future payment, please call HMRC nearer the time.

VAT Deferral – this means deferring or postponing your VAT – you will still need to pay it by March 2021

What is it?

We will support businesses by deferring Valued Added Tax (VAT) payments for 3 months.

Am I eligible?

All VAT-registered UK businesses are eligible.

How do I access it?

This is an automatic offer with no applications required. UK Registered businesses will not need to make VAT payments normally due with VAT returns during this period. Taxpayers will be given until the end of the 2020-21 tax year 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.

When can I access it?

The deferral will apply from 20 March 2020 until 30 June 2020.

Deferral of Self-Assessment payment - you will still need to pay it by January 2021

What is it?

The Self- Assessment payment on account, that is ordinarily due to be paid to HMRC by 31 July 2020 may now be deferred until January 2021.

Am I eligible?

If you are due to pay a self- assessment payment on account on 31 July 2020 then you are eligible for the deferment. The deferment is intended to assist self-assessment taxpayers, including those who are self-employed, who are suffering hardship as a result of the coronavirus.

The deferment is optional and any persons still able to pay their second self-assessment payment on account on 31 July 2020 should still do so.

How do I access it?

This is an automatic offer with no applications required. No penalties or interest for late payment will be charged if you defer payment of your July 2020 payment on account until January 2021.

HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of coronavirus and have outstanding tax liabilities.

When can I access it?

On 31 July 2020 when your self-assessment payment on account, ordinarily due to be paid on that date, may be deferred until 31 January 2021.

Small Business Grant Funding – this is for a small business with a business premises

What is it?

The Government is providing additional 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.

Am I eligible?

You will be eligible if

  1. Your business is based in England* AND
  2. You are a small business and already receive SBRR and/or RRR AND
  3. You are a business that occupies property

How do I access it?

You do not need to do anything. Your Local Authority will write to you if you are eligible for this grant.

When can I access it?

Local Authorities will write to all eligible businesses with information on how to claim this grant. Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant Local Authority. To find your Local Authority, use this search tool.

*Some aspects of business support are devolved. For business support outside of England go to ScotlandWales and Northern Ireland.

Statutory Sick Pay Rebate

What is it?

The Government will bring forward legislation to allow small and medium-sized businesses to reclaim Statutory Sick Pay (SSP) paid for staff sickness absence due to coronavirus. This refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of coronavirus.

Am I eligible?

You will be eligible if:

  1. Your business is UK based AND
  2. Your business is a small or medium sized and employs fewer than 250 employees as of 28 February 2020.

How do I access it?

A rebate scheme is being developed, further details will be provided in due course.

When can I access it?

The Government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible. Existing systems are not designed to facilitate employer refunds for SSP.

If you are self-employed and want to know if you are eligible for Universal Credit, please visit the gov.uk Universal Credit page

Business Rates Holiday for Retail, Hospitality and Leisure and Grant

What is it?

Businesses in the retail, hospitality and leisure sectors in England will not have to pay business rates for the 2020-21 tax year. Businesses that received the retail discount in the 2019-20 tax year will be rebilled by their local authority as soon as possible.

Am I eligible?

You will be eligible if:

  1. Your business is based in England*, AND
  2. Your business is in the retail, hospitality and/or leisure sector. Properties that will benefit from the relief will be those that are wholly or mainly being used:
  3. as shops, restaurants, cafes, drinking establishments, cinemas and live music venues,
    b. for assembly and leisure; or
    c. as hotels, guest and boarding premises and self-catering accommodation.

How do I access it?

  1. There is no action for you. Local authorities will apply the business rates holiday to your bills. For more information please check the guidance on gov.uk.
  2. You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.
  3. You can find your local authority on gov.uk.

When can I access it?

This will apply to your business rates bills for the 2020/2021 tax year. However, local authorities may have to reissue your bill. They will do this as soon as possible.

*Some aspects of business support are devolved. For business support outside of England go to ScotlandWales and Northern Ireland.

Grants

If your business is in the retail, hospitality or leisure sector, you will receive 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 over £15,000 and less than £51,000 will receive a grant of £25,000.

Am I eligible?

You will be eligible if:

  1. Your business is based in England*
  2. Your business is in the retail, hospitality and/or leisure sector
  3. Properties that will benefit from the relief will be occupied properties that are wholly or mainly being used
Self Employed Grants

This was the main announcement last night. Note: you can still work in your self-employed job if you claim this grant.

This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.

Who can apply?

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

  • have submitted your Income Tax Self-Assessment tax return for the tax year 2018-19
  • traded in the tax year 2019-20
  • are trading when you apply, or would be except for COVID-19
  • intend to continue to trade in the tax year 2020-21
  • have lost trading/partnership trading profits due to COVID-19

Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. 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 half of your 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 half of your average taxable income in the same period

If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way.

How much you’ll get

You’ll get a taxable grant which will be 80% of the average profits from the tax years (where applicable):

2016 to 2017

2017 to 2018

2018 to 2019

To work out the average HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 3 (where applicable), and use this to calculate a monthly amount.

It will be up to a maximum of £2,500 per month for 3 months.

We’ll pay the grant directly into your bank account, in one instalment.

How to apply

You cannot apply for this scheme yet.

HMRC will contact you if you are eligible for the scheme and invite you to apply online.

Individuals do not need to contact HMRC now and doing so will only delay the urgent work being undertaken to introduce the scheme.

You will access this scheme only through GOV.UK. If someone texts, calls or emails claiming to be from HMRC, saying that you can claim financial help or are owed a tax refund, and asks you to click on a link or to give information such as your name, credit card or bank details, it is a scam.

After you’ve applied

Once HMRC has received your claim and you are eligible for the grant, we will contact you to tell you how much you will get and the payment details.

If you claim tax credits you’ll need to include the grant in your claim as income.

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