We want to keep you up-to-date with the latest government announcements regarding support for businesses and individuals during this difficult time.
The government’s full guidance can be found at the following links:
So far, the government has introduced the following measures to help and support businesses with the impact of COVID-19:
Help to pay your tax:
Deferral of VAT Tax Payments: If you are due to make a VAT payment in the period 20 March 2020 to 30 June 2020, you will now have until the end of the 2020/21 tax year to pay any liabilities within this deferral period. This will be automatic and all UK businesses are eligible. VAT refunds and reclaims will be paid by the government as normal.
Deferral of Income Tax Payments: For Income Tax Self-Assessment payments due on 31 July 2020, if you are self-employed you are automatically eligible for this payment to be deferred until 31 January 2021, when your balancing liability would fall due. No penalties or interest will be charged in the deferral period.
HMRC’s Time to Pay Scheme: HMRC may be able to help your business with making any outstanding tax payments should you be concerned about paying your tax due to COVID-19. Should this be of interest and relevant going forward please let us know and we can help you liaise with HMRC. Alternatively, HMRC’s dedicated helpline should you wish to discuss this further with them is 0800 0159 559.
Job Retention Scheme: HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500/month. You may be able to access support in order to pay employees that would otherwise have been laid off during this crisis. To access the scheme, employers will need to designate affected employees as ‘furloughed workers’ and notify the relevant employees of this change. The employer will then need to submit information to HMRC about these employees through a new online portal. HMRC are working urgently to set up a system for reimbursement.
Grants for small businesses paying business rates: 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. If you are eligible, your local authority will write to you automatically. Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for the local authorities themselves was expected to be published 20 March.
Grants for business that pay little or no business rates: A £10,000 grant will be available to support small businesses that already pay little or no business rates because of small business rate relief (SBBR) or rural rate relief, to help meet their ongoing business costs. It states that if your business is eligible for SBRR or rural rate relief, you will be contacted by your local authority – you do not need to apply.
Business Rates ‘holiday’ for retail, hospitality and leisure businesses, as well as nursery businesses: The holiday will apply for the 2020/21 tax year and will be applied automatically to your next council tax bill. If this has already been issued, local authorities may have to reissue your bill automatically as soon as possible. Retail, hospitality and leisure businesses that received the retail discount in the 2019/20 tax year will also be rebilled by their local authority as soon as possible.
The Coronavirus Business Interruption Loan Scheme (CBILS) (which should be available from Monday 23rd March): The government will help support businesses to obtain finance. The government will also cover the first 12 months of interest, however, please note that it will ultimately be the liability of the borrower to pay the interest thereafter and to pay back the loan capital per the agreed terms. Further information on this may be found here:https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/
Help with paying Statutory Sick Pay (SSP): If your business has/have recently had people off sick as a result of COVID-19 then a refund of SSP may be available of up to 2 weeks per eligible employee. The guidance notes that “the government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible”.
SSP for individuals: If you cannot work due to coronavirus and are eligible for Statutory Sick Pay, you will get it from day one rather than the fourth day of illness. Statutory Sick Pay will be payable to people who are staying at home on government advice, not just those who are infected. This is intended to apply retrospectively from 13 March 2020.
Delay to IR35 Regime: HMRC also announced a deferral to the introduction of the IR35 Regime for off-payroll workers. Originally planned to commence from April 2020, it is now anticipated to defer until April 2021.
New claims for financial support for individuals:
· Universal Credit: Those affected by coronavirus will be able to apply for Universal Credit and can receive up to a month’s advance up front without physically attending a jobcentre. Self-employed claimants on Universal Credit who are required to stay at home or are ill as a result of coronavirus will not have a Minimum Income Floor (an assumed level of income) applied for a period of time while affected.
· Employment and support Allowance (ESA): The 7 waiting days for ESA for new claimants will not apply if they are suffering from coronavirus or are required to stay at home – so it will be payable from day one.
HMRC’s guidance also encourages businesses to look into their specific insurance policy Terms & Conditions and contact insurers where necessary, as they may have cover for both pandemics and government-ordered closure. Whilst they say that “Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics,” it may still be worth reviewing your individual policy with your insurance company.
Of course, we are monitoring the situation very closely and will keep you updated as soon as we are aware of any new guidance.
If you have any questions do not hesitate to contact to your usual Rothmans Team.