COVID-19: Self Employment Support
Chancellor Rishi Sunak has announced government support for self employed individuals affected by the coronavirus pandemic.

Cash grants of 80% of trading profits, up to £2,500 per month, will be paid via one payment. This grant will initially reflect three months of profits.

This support package is aligned to the Coronavirus Job Retention Scheme, whereby the government is paying a similar level (80% up to £2,500 per month) to furloughed workers.

It is available to  those with a trading profit of less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19. If less than three years of self assessment returns are available, the amount will be calculated from the returns available. Anyone who has not yet submitted their self assessment tax return for tax year ending 5 April 2019 has four weeks to do so.

Members of partnerships are also eligible for this support package. Those who pay themselves a salary and dividends through their own company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.

Payments are expected to be available from June. All those who are eligible for self employment support will be contacted direct by HMRC and invited to complete a form online.

Full details of this support package are here.
 
...Continue
COVID-19 Payments On Account Delayed
Payments on account that were due on the 31 July 2020 will now be payable by the 31 January 2021.

This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.

However, at the weekend Prime Minister Boris Johnson was forced to declare that the government ‘was standing behind’ the self employed, after claims that the government’s coronavirus rescue package did not offer the same level of support for this group as for employed workers.  Once we have more details of plans to increase support then we will notify all clients.

Please check out our dedicated COVID-19 support page for details and links to HMRC support pages.
...Continue
VAT Payments
The next quarter of VAT payments will be deferred, meaning businesses will not need to make VAT payments until the end of June 2020.

Businesses will then have until the end of the 2020-21 tax year to settle any liabilities that have accumulated during the deferral period.

The deferral applies automatically and businesses do not need to apply for it.
VAT refunds and reclaims will be paid by the government as normal.

We would however still recommend the VAT return is completed and filed if possible (but if you pay by DD you will need to cancel it).  By still completing the VAT return you will have a clear picture of the overall liability.  Where we are preparing the VAT return on your behalf it will also help us to manage the workflow. We are also able to extend our payment terms, if you need time to pay then please get in touch with Trina, Karen or Gary.

As and when we receive further information we will update you.
...Continue
Coronavirus Job Retention Scheme
Under the new Coronavirus Job Retention scheme, government grants will cover 80% of the salary of PAYE employees who would otherwise have been laid off during this crisis.

The scheme, open to any employer in the country, will cover the cost of wages backdated to 1 March 2020 and will be open before the end of April. It will continue for at least three months, and can include workers who were in employment on 28 February.

To claim under the scheme employers will need to:
  1. designate affected employees as ‘furloughed workers’, and notify employees of this change. Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and
  2. submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal.

HMRC will set out further details on the information required.HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.

While HMRC is working urgently to set up a system for reimbursement, we understand existing systems are not set up to facilitate payments to employers. Businesses that need short-term cash flow support, may benefit from the VAT deferral announced last week (our e-mail update to follow) and may also be eligible to apply for a Coronavirus Business Interruption Loan.

Once we have more information we will update you and will help clients wherever necessary to make a claim.
...Continue

Get in touch - If you'd like to find out more about how we can help you and your business pay less tax, generate more profits and create long-term wealth for you and your family, please get in touch now