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27th March 2020 communication from Willows our accountants
We are sure most people will have seen the news last night that HMRC are putting in place measures to help the self employed in order to bring things into line with the 80% of wages employed workers are to receive. If you have completed and filed your 5 April 2019 tax return HMRC will write to all self employed individual’s who are eligible to receive funding in due course. If you have not yet filed your 5 April 2019, now is the time to do so, you only have until 23 April to get it in before the cut off date for this grant. It is important to note here that the government have specifically said that they shall not call or e-mail so if you receive anything like this, its a scam.
At present, you don’t need to do anything at the moment. HMRC will review all self employed workers tax returns and shall then, if you are eligible, write directly to you and there shall then be an online application to be made, if you struggle with this let us know and we should be able to help.
However, there are two pieces of disappointing news. Firstly this scheme is intended to cover 95% of self employed people which, of course, means that some self employed workers (5%) will get no assistance. Secondly the government do not expect this money to actually start being paid until, at best, June. Government advice is currently to contact Universal Credit (0800 328 5644) to see if you are eligible to make a claim (I would have thought that line may be busy so please be patient). Another option is to access the business loan interruption scheme, please remember though that this is a loan and so will need to be repaid (perhaps the grant received could be used to repay?) and in order to apply for this you should contact your bank directly.
We shall provide updates when they become know and if you have any queries in the meantime, just get in touch
Best Regards, hoping you are all well
Willows Accountancy Limited
23rd March 2020 Message from Willows our accountants
While we are sure that everyone is avidly following the news about Coronavirus and how it is effecting business, we hope that you shall find it helpful if we provide a summary of what is known so far and a useful link to the Government website – this website is updated at least daily so is a good source of new information.
- Coronavirus Job Retention Scheme – this is the measure that was announced on Friday whereby the government shall provide 80% of the funding for employees wages in order to avoid redundancy. At present although their seems to be the basics of a system in place to inform HMRC that employees have been entered on this scheme there is no way of submitting the information to HMRC or actually accessing the money, this is a matter of urgency to the government though so updates should be available soon. Please also be aware that this scheme covers salary so for owner/managed businesses there is no work yet on how, or indeed if, dividends shall be covered
- Sick pay – employers can reclaim SSP for two weeks of employee absence – again at present there is no system in place for actually receiving this money and the above job retention scheme seems to be what the government are focusing on at present. SSP used to be knocked off the payment of PAYE & NI that is made monthly/quarterly to HMRC and so it would seem sensible that something similar is used now.
- Tax relief – self employed individuals are now not required to make their July payment on account and VAT registered business do not need to make payment of VAT. Please remember though that these tax liabilities are merely deferred not cancelled – they do need to be paid eventually.
- Rates holidays and government grants – any business in the retail/hospitality and leisure businesses should receive exemption from business rates and all businesses with premises that pay either no business rates or whose premises have a rateable value of up to £51k shall receive a grant of some sort. In al cases the local councils shall be in touch with either amended rates bills, details of the grant available to that business or both.
- Coronavirus Business interruption Loan Scheme – Funding over the next few months is going to be a major concern for all business but there is additional worry if your business already has loan repayments to make. It may be that in order to service these loans a new loan will need to be arranged with your bank via the business interruption loan scheme. The loan scheme is also there to help businesses who find themselves in general need of funding.
Even with the latest information there a big questions that still need answering, what is going to be done for the self employed, how will relief, if any, be given for the amounts shareholders take in dividends and, perhaps most importantly, how can businesses get their hands on the relief measures available.
Should you have any queries not covered by any of the above, there is a government helpline available – 0300 456 3565
Willows Accountancy Limited