Support for those affected by COVID-19

Our Latest Updates...

This page will be updated as we receive more information

Business advice and grants – coronavirus information

The government has announced initial details of four national business grants that will be available to support businesses affected by the lockdown period.

  • Local Restrictions Support Grant (Closed) – businesses that were open but have been required to close for the new lockdown period (5 November to 2 December)
  • Local Restrictions Support Grant (Sector) – businesses that have been required by law to be closed since 23 March 2020 and any others required to close in the future
  • Additional Restrictions Grant – businesses that have been required to close or severely impacted by the new lockdown period
  • Local Restrictions Support Grant (Open) – this grant is not currently available to Northampton businesses. It becomes available when an area is designated Alert Level High (Tier 2) or Very High (Tier 3)

From Thursday 5 November until Wednesday 2 December the Government has ordered certain businesses and venues in the UK to close.

Furlough Scheme Extended and Further Economic Support announced

After this weekend’s announcement from the Prime Minister, people and businesses across the UK are being provided with additional financial support as part of the government’s plan for the next phase of its response to the coronavirus outbreak. As part of our effort to keep our clients informed we have summarised some important updates below:

Job Retention Scheme

  • The Prime Minister has announced that the government’s Coronavirus Job Retention Scheme (CJRS) – also known as the Furlough scheme – will remain open until December, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500.
  • In addition, business premises forced to close in England are to receive grants worth up to £3,000 per month under the Local Restrictions Support Grant.
  • £1.1bn is being given to Local Authorities, distributed on the basis of £20 per head, for one-off payments to enable them to support businesses more broadly.

What support is being provided and employer costs:

  • For hours not worked by the employee, the government will pay 80% of wages up to a cap of £2,500. The grant must be paid to the employee in full.
  • Employers will pay employer NICs and pension contributions and should continue to pay the employee for hours worked in the normal way.
  • As with the current CJRS, employers are still able to choose to top up employee wages above the scheme grant at their own expense if they wish.
  • The Government will confirm shortly when claims can first be made in respect of employee wage costs during November, but there will be no gap in eligibility for support between the previously announced end-date of CJRS and this extension.

Who is eligible?

Employers
  • All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the CJRS.
  • The government expects that publicly funded organisations will not use the scheme, as has already been the case for CJRS, but partially publicly funded organisations may be eligible where their private revenues have been disrupted. All other eligibility requirements apply to these employers.
Employees
  • To be eligible to be claimed for under this extension, employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020. *As under the current CJRS rules:
  • Employees can be on any type of contract. Employers will be able to agree any working arrangements with employees.
  • Employers can claim the grant for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. Such calculations will broadly follow the same methodology as currently under the CJRS.
  • When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
  • Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
  • For worked hours, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NICs due on those amounts.

Mortgage Holidays

  • Mortgage payment holidays will no longer end today. Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.
  • The FCA will announce further information today.

Business Grants

Businesses required to close in England due to local or national restrictions will be eligible for the following:
  • For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks;
  • For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks;
  • For properties with a rateable value of £51k or over grants to be £3,000 per month, or £1,500 per two weeks.

Get our latest updates on the COVID-19 situation

We are producing regular emails regarding the latest updates from HMRC & the government about the COVID-19 situation and how it affects your business.

To be receive these updates please fill in the form below, you can unsubscribe at any time.

This is a separate mailing to our normal marketing activity and you will not be added to any other list without your prior consent.

Our Latest Articles on COVID-19 Support

View the new website from HMRC outlining the levels of support available to you

Assistance for your business: Research and Development Tax Credits

Businesses are naturally concerned about cash flow, trade after lockdown and the debt associated with using the government-backed loan schemes.

R&D tax credits can help provide a quick, debt-free source of cash during these difficult times.

Eligibility:

Any business investing in innovation, regardless of industry, can apply for tax credit relief. Our team has recently been able to assist a business in the construction industry receive a £400k claim.

If a business is attempting to create or develop an idea, product or service through its own research into something that is not simply to advance a method or product currently in place and used by them, then the business may be carrying out a qualifying activity thus eligible for R&D Tax Credits.

Some examples of activities which have been successful in R&D Tax Credit applications:

  • A new flavour in the snack industry
  • Changing the fermentation process in the brewing industry
  • Modifying the internal production process in the health and beauty industry

To discuss this further visit: https://www.cottonsaccountants.co.uk/research-and-development/

Previous Updates...

HMRC have issued updated guidance for those that are self-employed or members of partnerships. 

We have prepared a brief summary of the key points to note and actions to take in our article

Self-Employed Income Support Scheme (SEISS) – Are you eligible for a grant?

This scheme will help small and medium-sized businesses affected by coronavirus (COVID-19) to apply for loans of up to £50,000.

Eligibility

You can apply for a loan if your business:

  • is based in the UK
  • has been negatively affected by coronavirus
  • was not an ‘undertaking in difficulty’ on 31 December 2019

https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan 

Additional Funding for Small Businesses

This relates to a pool of funding available for those not covered by existing local authority grants and business rates relief, primarily aimed at small businesses (less than 50 employees) with ongoing fixed property-related costs.

Funding 

There will be three levels of grant payments. The maximum will be £25,000. There will also be grants of £10,000. Local authorities will have discretion to make payments of any amount under £10,000. It will be for councils to adapt this approach to local circumstances.

Eligibility

The grants are primarily and predominantly aimed at Small Businesses, with relatively high ongoing fixed property-related costs. Businesses will need to demonstrate that they have suffered a significant fall in income as a result of COVID-19.

  • The Government has asked for the following businesses to be prioritised;
  • Small businesses in shared offices or other flexibles workspaces. 
  • Regular market traders with fixed building costs, without their own business rates assessment.
  • Bed & Breakfasts which pay Council Tax (rather than Business Rates)
  • Charity properties in receipt of Charitable Business Rates Relief which would otherwise have been eligible for Small Business Rates Relief or Rural Rate Relief
Businesses that may qualify should check on their local authority web site for further details. Please note that authorities will be issuing closing deadlines for applications, this will vary between authorities.
 

HMRC have released a step by step guide explaining the information that employers need to provide to HMRC to make a claim through the Coronavirus Job Retention Scheme (CJRS). 

https://www.gov.uk/government/publications/coronavirus-job-retention-scheme-step-by-step-guide-for-employers

Find out how to calculate 80% of your employee’s wages, National Insurance Contributions and pension contributions if you’ve furloughed staff due to coronavirus (COVID-19).

https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme 

ICAEW’s Tax Faculty highlights the key additions to HMRC’s guidance on the coronavirus self-employed income support scheme (SEISS), which now includes details on calculating trading profits and more information on the interaction with universal credit.
The Northampton Borough Council have launched an online form to record details for processing the business grants. Use this service to process your grant for:
  • a small business
  • a retail or hospitality business
  • a leisure business
Click the images below to view the individual council pages:
Support for those affected by COVID-19 - Image 6 Support for those affected by COVID-19 - Image 7
 

Rugby Borough Council will be administering the Government’s Small Business Grants for eligible businesses that currently pay business rates in the Borough. 

The Council aims to contact all eligible small businesses shortly with details on how to apply and are working to get the applicable grants paid as soon as possible.

Registered eligible businesses can complete an online confirmation statement confirming their eligibility by clicking the image below:

Support for those affected by COVID-19 - Image 8

We have received news that some local councils are offering to delay payments for those most in need.

Please contact your local council to discuss further.

This page will be updated as we receive more information

In a further update to the Coronavirus Job Retention Scheme guidance, the government has announced that it will now cover the employer national insurance (NI) and employer auto enrolment costs for furloughed staff

The Government has confirmed that those who pay themselves a salary and dividends through their own company are not covered by the Self-employment scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating a PAYE scheme.

The Coronavirus Job Retention Scheme requires that an employee is ‘furloughed’; effectively stood down. There has been some debate as to whether Directors could be furloughed as they could not meet the criteria of ‘not working’ (providing services or generating revenue). Although not officially confirmed it is understood that a Director will be allowed to fulfil their statutory obligations as directors (e.g. official legal filings to companies house etc.) whilst furloughed. On this basis in appropriate circumstances Directors may be furloughed and claim under the Coronavirus Job Retention Scheme.

Points to note:

  • To be furloughed there is a minimum of 3 weeks you can’t work for your company but you can continue to fulfil any statutory responsibilities as a Director e.g. official legal filings to Companies House etc.
  • Your actual salary before tax, as of 28 February 2020 will be used to calculate the 80% funding This will vary depending on your salary arrangements.
    In the typical Directors case a salary of £719 per month (£8,628 pa) would give rise to 80% funding of £575. On a salary of £1,042 per month (£12,500 pa) funding would be £833.
  • If a higher salary was being declared then the funding will be based on this higher figure subject to a cap of £2,500 per month
  • For those we prepare the payroll for – tell us if you are furloughing yourself and any employees – we’ll need the date effective from and how much is being paid.
  • 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 – Directors should also keep some written evidence of the decision to furlough and the date it applies from. Keep this written evidence or email to us for our records.

HMRC have now issued guidance on what can be claimed through the Job Retention.

Click Here

Our team have been in touch with HMRC this morning (via their web chat).
The advisors have recommended that where our clients have a Direct Debit set up and wish to take advantage of the VAT deferral, they should instruct their bank to cancel the Direct Debit rather than expect HMRC to not collect the payments during the deferral period.

The deferral applies to payments due between 20 March and 30 June (this covers VAT quarters Feb 20 to April 20 only).

May VAT returns will need to be paid by 7 July.

You must apply to Companies House for the extension. If you do not apply for an extension and your accounts are filed late, an automatic penalty will be imposed.

The Latest Updates from the Government

The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.

The following links provide information on financial support packages for businessess, advice on how to operate your business, support for your employees, for example workers’ wage costs and information on changes to planning and regulations.

We are here to help

Contact our accountants and tax specialists in Northampton, Daventry, RugbyMilton Keynes and London