Below I have summarised all the main tax related updates we have seen this week.
· Self-Employment Income Support Scheme – Apply for Second Grant on or Before 19th October 2020
· Government Grant for Customs Training Funding
· Ensure Your Savings Are Safe - FSCS Bank Protection Limit
· Job Support Scheme Expanded to Firms Required to Close Due to COVID Restrictions
If you have any queries about this week’s content, please do not hesitate to contact me.
I hope you have a great weekend!
Steven Hillman BSc (Hons) ACA
Tel: 01934 444100
Self-Employment Income Support Scheme –
Apply for Second Grant On Or Before 19th October 2020
The Self-Employment Income Support Scheme (SEISS) allowed you to claim a first taxable grant. Applications for the first grant closed on 13 July 2020.
The second taxable grant is worth 70% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £6,570 in total.
Applications for the second grant are now open. Make your claim from the date HMRC give you. If you are eligible and your business has been adversely affected on or after 14 July 2020, you must make your claim for the second grant on or before 19 October 2020.
The scheme is being extended from 1 November. The grant extension is for self-employed individuals who are currently eligible for the Self-Employment Income Support Scheme and are actively continuing to trade but are facing reduced demand due to coronavirus (COVID-19).
The extension will provide two grants and will last for six months, from November 2020 to April 2021. Grants will be paid in two lump sum instalments each covering a three-month period.
The first grant will cover a three-month period from the start of November until the end of January. HMRC will provide a taxable grant covering 20 per cent of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £1,875 in total.
HMRC are providing broadly the same level of support for the self-employed as is being provided for employees through the Job Support scheme.
The second grant will cover a three-month period from the start of February until the end of April. HMRC will review the level of the second grant and set this in due course.
The grants are subject to Income Tax and National Insurance Contributions.
Grant for Customs Training Funding
HMRC have extended the deadline for customs training funding.
Applications are open until 30 June 2021 (or until all funding is allocated)
The funding can be used towards helping businesses train staff in making customs declarations.
The funding is open to businesses that are established in or have a branch in the UK when the grant is paid to you, and for those that have not previously failed to meet tax obligations.
To apply for the grants, your business must either complete customs declarations for yourself or someone else (or intend to in the future) and you must import from or export to the EU.
The grant will give you up to 100% of the cost of training for your employees, up to a limit of £1,500 per trainee.
OTHER GRANTS IF YOUR BUSINESS COMPLETES CUSTOMS DECLARATIONS
If your business completes customs declarations You can apply for 3 grants to help your business complete customs declarations for recruitment, training and IT improvements.
You can apply to get funding for:
• training that helps your business to complete customs declarations and processes (see above)
• hiring new staff to help your business complete customs declarations
• IT improvements to help your business complete customs declarations more efficiently
Your business must:
• have been established in the UK for at least 12 months before the submission of your application and when the grant is paid
• not have previously failed to meet its tax obligations
In addition, your businesses must meet one of the descriptions below:
• complete or intend to complete customs declarations on behalf of your clients
• be an importer or exporter and complete or intend to complete declarations internally for your own goods
• be an organisation which recruits, trains and places apprentices in businesses to undertake customs declarations.
Ensure Your Savings Are Safe - FSCS Bank Protection Limit
If you have money held with a UK institution which is regulated by either the Financial Conduct Authority (FCA) or the Prudential Regulation Authority (PRA), you will have access to the Financial Services Compensation Scheme FSCS in the event that something goes wrong.
Under the FSCS, the first £85,000 of your savings (£170,000 if your money is held in a joint account) is protected if the bank or building society provider were to become insolvent or go bust.
The FSCS provides the same level of compensation for both a small company and individual savers.
We advise clients to save a percentage of their profits to cover their tax liabilities and for working capital requirements, however it can mean that a business can amass a significant sum in their deposit accounts. If the balance held is more than £85,000, it is important to consider spreading the money with different regulated banks.
You can read more information on the FSCS and check that the financial institution holding your money is protected here: https://www.fscs.org.uk/check-your-money-is-protected/
Job Support Scheme Expanded to Firms Required to Close Due to COVID Restrictions
The government’s Job Support Scheme (JSS) will be expanded to protect jobs and support businesses required to close their doors as a result of coronavirus restrictions, the Chancellor announced 9 October.
Under the expansion, firms whose premises are legally required to shut for some period over winter as part of local or national restrictions will receive grants to pay the wages of staff who cannot work The Government’s aim is to protect jobs and enable businesses to reopen quickly once restrictions are lifted.
The government will support eligible businesses by paying two thirds of each employees’ salary (or 67%), up to a maximum of £2,100 a month.
Under the scheme, employers will not be required to contribute towards wages and only asked to cover NICS and pension contributions, a very small proportion of overall employment costs. It is estimated that around half of potential claims are likely not to incur employer NICs or auto-enrolment pension contributions and so face no employer contribution.
Businesses will only be eligible to claim the grant while they are subject to restrictions and employees must be off work for a minimum of seven consecutive days. Businesses can apply for the JSS including the new expansion even if they haven’t previously used the Coronavirus Job Retention Scheme (CJRS).
The scheme will begin on 1 November and will be available for six months, with a review point in January. In line with the rest of the JSS, payments to businesses will be made in arrears, via a HMRC claims service that will be available from early December. Employees of firms that have been legally closed in the period before 1 November are eligible for the CJRS.
The scheme is UK wide and the UK Government will work with the devolved administrations to ensure the scheme operates across all four nations.