I know there is an overload of news and information for individuals and businesses during this Covid-19 pandemic. That said, it is the most worrying time for many individuals and businesses. Businesses face perhaps the most dramatic time in their history, with many wondering how they will make it through this.
Help is Out There
The government has made many announcements over recent days, and there is a constantly changing stream of advice and support. The government website, is an invaluable source of information, showing what can be claimed and how to claim it. If you need help, here are my top 6 tips for you.
1. Wages for Furloughed Workers
The government announced they will pay 80% of the wages, up to a maximum of £2,500 per month. This applies to staff members who have been laid off but your business wishes to retain them rather than lose them. This is a huge help in ensuring you do not lose valuable staff members that you are unable to pay due to the short-term consequences of the Covid-19 pandemic.
2. VAT Relief
From 20th March until 30th June, businesses will not be required to pay their VAT liability at the usual time. Instead they can defer payment, though this must be paid by the end of the 2020/21 tax year. No application is required for this.
3. Income Tax relief
Self-Assessment payments due on 31st July 2020 will be deferred until 31st January 2021 for all self-employed individuals. No interest or penalties will apply. No application is required. In addition, HMRC have increased their time to pay offer for the self-employed and corporate taxes. This allows an arrangement to be put in place to allow an extended payment time of outstanding tax liabilities. This is on a case by case basis, requiring discussion with HMRC.
4. Statutory Sick Pay (SSP)
Businesses with up to 250 employees (as at 28th February 2020) can reclaim SSP for up to 2 weeks for any employee off work sick due to Covid-19. The scheme is still being developed and further details are likely to be announced soon.
5. Business Rates Support
Businesses qualifying for small business rate relief will automatically be eligible for a £10,000 grant to help meet ongoing costs. Local authorities will write to all eligible businesses shortly.
Specific support for retail, hospitality and leisure businesses as well as Nursery businesses will be provided by means of a business rates holiday.
6. Business Interruption Loan Scheme
Small and medium sized businesses with a turnover of up to £45 million per year can apply. Government will guarantee 80% of each loan, enabling Banks to lend more freely during this period of uncertainty.
That’s Not All
Further help is available for larger businesses and this is detailed on the government website too. Further announcements are likely over the coming days and weeks.
This is an extremely comprehensive response from the government, beyond what practically anyone expected. It remains to be seen whether it works and businesses and jobs are saved in the way it is hoped.
It also remains to be seen whether further help will be provided for the self-employed and micro-business owners who get their ‘wages’ from doing their own work. So far that is a sector of the working population that appears to have been left out.
Don’t Take Liberties
The support offered is extensive and, as with most legislation, open to a degree of abuse. There have already been reports of Accountants finding ways to make claims solely to benefit businesses in ways that are illegal and extremely immoral. This brings discredit to my profession and shame on those who abuse the system.
We are all in this together, by all means claim what is allowed, that’s what it’s there for.
Let’s help each other out and be kind to one another. Kindness costs nothing.
If you need any advice please contact me
