Summary of UK Business Rules Relaxed During the Coronavirus Pandemic

We thought it would be useful to publish a summary of the rules that have been temporarily relaxed by the Government to make it easier for businesses to continue working through the disruption caused by coronavirus (COVID-19).

The government has temporarily relaxed the rules in the following areas:

• Annual leave: Workers will be allowed to carry over leave into the next 2 years.

• Business rates revaluation postponed: Revaluation of business rates will no longer take place in 2021 to help reduce uncertainty for firms affected by the impacts of coronavirus.

• Childcare funding: Councils will be able to move around government funding for free childcare entitlements to make sure sufficient childcare places are available for vulnerable children and those of critical workers.

• Companies House enforcement: Enforcement process has been relaxed, including temporarily pausing the strike off process to prevent companies being dissolved.

• Competition law: Rules have been relaxed for certain agreements that would normally be considered anti-competitive.

• Corporate insolvency and governance: New measures have been introduced to relieve the burden on businesses, including:

o temporary easements on filing requirements and Annual General Meetings (AGMs)

o a new moratorium to give companies breathing space from their creditors while they seek a rescue

o temporarily removing the threat of personal liability for wrongful trading from directors

• Delivery drivers’ hours: Rules have been relaxed for 30 days for drivers supplying supermarkets.

• Destroying spoilt beer: Temporary measure to help brewers and publicans.

• Driver CPC requirement: Temporary changes to allow bus and lorry drivers who cannot complete compulsory Driver CPC training to continue to drive.

• Energy supply: Guidance from Ofgem on how to manage this.

• Eviction protection for commercial tenants: A ban on eviction for businesses who cannot pay their rent.

• Filing accounts and annual statements: 3-month extension from Companies House.

• Gender pay gap reporting: Deadline suspended for one year.

• Hotel accommodation for key workers: Letter to hotel chief executives allowing them to offer accommodation to support key workers and vulnerable people.

• Intellectual property services alterations: Patent applications.

• MOTs suspended: vehicle owners have been given a 6-month exemption.

• Navigation charges deferred: Charges for air navigation services in European airspace deferred for up to 14 months.

• Off-payroll working rules (IR35): The new rules have been delayed by 12 months.

• Personal protective equipment (PPE) and hand sanitiser: New suppliers will be able to bring products to market more quickly and easily.

• Pubs and restaurants to operate as takeaways: Pubs and restaurants will not need planning permission.

• Right-to-work checks: Temporary adjustments will make it easier for employers to carry out.

• Statutory Residence Test: Temporary changes for those coming to the country to work on COVID-19 related activity.

• Tax cuts to reduce PPE cost: PPE purchased by care homes, businesses, charities and individuals to protect against coronavirus will be free from VAT for a 3-month period.

• Taxable expenses: Find out what is taxable while employees are working from home.

You can read more here: https://www.gov.uk/government/organisations/department-for-business-energy-and-industrial-strategy

Contacted by Coronavirus Test and Trace - Eligibility for Statutory Sick Pay (SSP)

Under the test and trace system that launched on 28 May, a person who has been notified that they have had contact with a person with coronavirus is requested to self-isolate for 14 days. The rules relating to SSP have been amended to include employees who are self-isolating in these circumstances.

If you have been working from home and are not furloughed, you may be able to continue working and should receive full pay, as normal. If this does not apply and your employer does not have a company sick pay scheme, then under new laws from 28th May 2020, you may be entitled to receive SSP for every day you are in isolation - from the first day - as long as you meet the eligibility conditions. This is the case whether or not you go on to develop symptoms.

If you were already on furlough when you were contacted by the test and trace service, you should discuss with your employer whether it is best for you to be kept on furlough or moved over to SSP - although there seems to be some flexibility, you cannot receive both at the same time. One consideration is that employers are required to pay SSP themselves, although may qualify for a rebate for up to two weeks of SSP. If employers keep a 'sick' furloughed employee on furlough, they remain eligible to claim at least a proportion for these costs through the furlough scheme.

Weekly Update 26th June 2020

Below I have summarised all the main tax related updates we have seen this week.

• Self-employed new parents can claim support grant

• VAT registered businesses advised to reinstate VAT direct debits

• Repaying Job Retention Scheme Grants

• Changes to notifying an option to tax land and buildings during coronavirus

I hope you have a great weekend!

Best wishes,

Steve

Steven Hillman ACA

Chartered Accountant

Tel: 01934 444100

https://www.hillmans.co.uk/covid-19-updates

Changes to notifying an option to tax land and buildings during coronavirus

The time limit for notifying HMRC of a decision to opt to tax land and buildings has been temporarily extended to 90 days due to COVID-19.

Normally you are required to notify HMRC within 30 days of deciding to opt to tax land and buildings. This can be done by emailing a scanned copy of the signed notification to opt to tax, or by printing and posting a signed copy of the notification. 

Due to the impact of COVID-19, the rules have been temporarily changed for decisions made between 15th February 2020 and 31st October 2020.

Normally supplies of land and buildings are exempt from VAT. However, you may opt to tax a piece of land or a building so you can recover any VAT incurred in making those supplies. 

This is a complex area of taxation, so please do not hesitate to contact us if you have any queries regarding this. We would be pleased to assist.

VAT registered businesses advised to reinstate VAT direct debits

The VAT payment deferral comes to an end on the 30th June. The deferral gives businesses the option to defer VAT payments falling due between the 20th March and 30th June until the 31st March 2021.

Businesses who are registered for VAT have been advised to reinstate their direct debit mandate, to ensure any VAT payments becoming due from the 1st July 2020 onwards are not late. The direct debit can be setup via the online tax account.

The Institute of Chartered Accountants in England and Wales (ICAEW) said: 'HMRC has confirmed that it will not collect the outstanding balance of deferred VAT when the direct debit mandate is reinstated. HMRC has made the necessary systems change to avoid this happening for businesses in Making Tax Digital for VAT.

Repaying Job Retention Scheme Grants

We recently had a client ask us if its possible to repay the grant they received from the Job Retention Scheme, as the impact of COVID-19 on their business was not as bad as originally expected. You may have seen in the press some larger companies promising to repay the JRS grant also.

We have spoken to HMRC and at present their official stance is that they are not expecting or encouraging any business to repay the JRS grant. Indeed as mentioned last week, there is no facility for this to be repaid even if a business wanted to. 

For businesses who want to repay the JRS grant our advice is to hold fire until the long-term impact of COVID-19 is better understood. By then HMRC will have updated guidance on how repayments can be made should you wish to do so. 

Self-employed new parents can claim support grant

The Government has announced that self-employed parents whose trading profits dipped in 2018/19 because they took time out to have children will be able to claim for a payment under the self-employed income support scheme (SEISS).

The scheme requires claimants to have traded in 2018/19 with their profits making up at least half of their total income. They must also have submitted a self-assessment tax return on or before 23 April 2020 for the 2018/19 tax year.

For those self-employed new parents who are affected, they will now be able to use either their 2017-18 or both their 2016-17 and 2017-18 self-assessment returns as the basis for their eligibility for the SEISS.

They will also need to meet the other standard eligibility criteria for support under the SEISS. Further details of the change for self-employed parents will be set out by the start of July in published guidance.

Read more here: https://www.gov.uk/government/news/self-employed-new-parents-can-claim-support-grant

Weekly Update 19th June 2020

Below I have summarised all the main tax related updates we have seen this week. 

• Applications close on the 21st June for the Salesforce £5,000 small business grants

• Updated HMRC Guidance on Self-employment Income Support Scheme

• Changes to the Coronavirus Job Retention Scheme

• Treasury Committee recommends additional help for businesses

I hope you have a great weekend!

Best wishes,

Steve

Steven Hillman ACA

Chartered Accountant

Tel: 01934 444100

https://www.hillmans.co.uk/covid-19-updates 

Treasury Committee recommends additional help for businesses

With Directors of Limited Companies and the newly self-employed being excluded from the Self-Employment Income Support Scheme (SEISS), we’re hoping that the Chancellor will listen to Mel Stride the Chair of the Treasury Committee who is urging the Government to provide additional help for businesses. 

It is estimated over one million self-employed and company directors have been excluded from the scheme.

We are keeping our figures crossed this will lead to some much-needed assistance to those businesses who have received no Government help so far. 

We will keep you updated of any developments!

Updated HMRC Guidance on Self-employment Income Support Scheme

HMRC has published its updated guidance to confirm who is eligible for the two Self-employment Income Support Scheme (SEISS) grants.

HMRC has published examples on its website which details when it considers a business has been 'adversely affected' by COVID-19 and would meet the criteria for the 1st and 2nd SEISS grants.

The first grant is available to self-employed business owners adversely affected up to 13th July 2020, and the second grant is available to self-employed business owners affected after 13th July 2020.

HMRC has provided some guidance on the meaning of ‘adversely affected’.  This includes being unable to work because the taxpayer is shielding, self-isolating or is on sick leave or has care responsibilities because of coronavirus. It also includes scaling down or temporarily stopping trading because the supply chain has been interrupted, the business has fewer or no customers or staff are unable to work.

The first grant is calculated as 80% of three months of trading profits, up to a maximum of £7,500. The second grant is calculated as 70% of three months of trading profits, up to a maximum of £6,570.

Applications for the first grant are open now and will close on 13th July 2020. Applications for the second grant will open in August.

HMRC has confirmed that if you are self-employed and able to return to work as normal in June you will not be eligible for the second SEISS grant.

Read more here: https://www.gov.uk/guidance/how-different-circumstances-affect-the-self-employment-income-support-scheme

Applications now open for Salesforce £5,000 small business grants

Applications are now open for the Salesforce Small Business Grants. This is a £5,000 grant for eligible small businesses that have received no grants in relation to COVID 19. 

To be eligible to apply, companies must:

-Be registered at Companies House

-Been established for at least 12 months

-Have not received any other cash grant during 2020 in relation to COVID-19 from any Government

-Be based in the UK with a British bank account

-Have between 2 to 50 employees

-Meet all other eligibility requirements as stated in the grant programme terms

The application window for the South of England region covering Somerset and Bristol is now open and you will have until 21st June to apply. 

You can read more about the grant and check to see if you qualify here: 

https://www.enterprisenation.com/smallbusinessgrants/  

Changes to the Coronavirus Job Retention Scheme

HMRC have now published details on how the Coronavirus Job Retention Scheme will change from 1st July.

Important upcoming furlough dates: 

• The scheme will close to anyone who hasn’t been furloughed for 3 weeks by 30th June.

• The first time you will be able to make claims for days in July will be 1st July, you cannot claim for periods in July before this point.

• From 1 July, employers can bring furloughed employees back to work for any amount of time and any shift pattern, while still being able to claim CJRS grant for the hours not worked.

• The 31st July is the last day that you can submit claims for periods ending on or before 30th June.

• From 1 August 2020, the level of grant will be reduced each month. To be eligible for the grant employers must pay furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they are being furloughed.

• For September, the government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.

• For October, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.

• The Coronavirus Job Retention Scheme will close on 31 October 2020.

If an error is made in a CJRS claim that means you received too much money, you must pay this back to HMRC. You can notify HMRC of this online in the application system.

If you made an error in a CJRS claim and do not plan to submit further claim, HMRC are looking to update the system so you can make the notification online. This facility is not yet in place. 

You must keep records of all furlough claims for 6 years.

You can read more here: https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme/changes-to-the-coronavirus-job-retention-scheme

If you need any help with the Coronavirus Job Retention Scheme please drop us a line. 

Weekly Update 12th June 2020

Below I have summarised all the main tax related updates we have seen this week. 

• Cycle to work scheme

• HMRC powers to recover Covid-19 payments

• Construction VAT reverse charge delayed again to March 2021

• New Addition to the Hillmans Team!

I hope you have a great weekend!

Best wishes,

Steve

Steven Hillman ACA

Chartered Accountant

Tel: 01934 444100

https://www.hillmans.co.uk/covid-19-updates

Cycle to work scheme

The Government is encouraging employers to consider joining a Cycle to Work scheme to help ease pressure on public transport due to the COVID-19 pandemic.

The government-backed cycle to work scheme allows employees commuting to work to pay for bikes and related accessories via salary deductions from pre-tax income. This can result in tax and national insurance savings for both employees and employers.

The cycle to work scheme was introduced to try and encourage employees to cycle to work and reduce environmental pollution by providing tax incentives to employers and employees.

To qualify for the relief, the following conditions must be met:

• The employer must purchase the cycle and related accessories and then loans the cycle to the employee during the “loan period”

• The employee then uses the bike mainly for qualifying journeys; i.e. commuting to and from work

• The cycle to work scheme must be available to the whole workforce

The employer can recover the cost of providing the bike and accessories loaned to the employee via a salary sacrifice arrangement. Under this arrangement the employee will agree to a reduced salary (benefiting from less PAYE tax and NIC). The gross reduction in salary per month could be the cost of the cycle divided by the loan period in months.

The employee can then purchase the bicycle from the employer at the end of the loan period. This has to be done at market value, which is at a substantial discount to the original cost, as well as taking into account any payments made by the employee to the employer.

If the employer is VAT registered they can claim input VAT on the purchase of the bike, but its worth keeping in mind that they will need to declare output VAT on any disposal. In addition the bike will be of a capital nature and the employer will be able to claim a tax deduction. 

If you would like to discuss this further please drop us a line. 

HMRC powers to recover Covid-19 payments

We have been advising clients for some time now that HMRC will start to closely review a claimant’s eligibility for the Covid-19 reliefs and grants being paid. Well we noticed that a HMRC draft consultation paper has now been published on the .Gov website supporting this (unsurprisingly without much fanfare):

https://www.gov.uk/government/consultations/draft-legislation-taxation-of-coronavirus-covid-19-support-payments

The consultation period closes on the 12th June 2020, but the paper covers the powers HMRC would have to raise a tax assessment on anyone who has received a SEISS or CJRS payment to which they are not entitled, or anyone who has not used a CJRS payment to pay furloughed employee costs. It also gives HMRC powers to charge a penalty where a person deliberately makes an incorrect claim for a SEISS or CJRS payment. In addition, it gives HMRC powers to charge a penalty where a person who has claimed a CJRS payment deliberately does not use it for the costs it was intended to reimburse. 

These HMRC powers aim to quite rightly cover situations of fraud and misuse of government schemes. However if you haven’t yet made a claim and feel that you are eligible for support, it is important to make a claim in a timely manner. Please drop us a line and we can talk you through what support may be available.

Construction VAT reverse charge delayed again to March 2021

Due to the impact of the Coronavirus on the construction sector, the UK VAT domestic reverse charge has been delayed until March 2021. 

The VAT reverse charge was due to be introduced in October 2020, and would have seen an end to subcontractors in the construction sector receiving VAT payments in most situations. 

It is the second time we have seen a delay with this scheme, the original date for the changes to be introduced was scheduled for October 2019.

Under the proposed VAT reverse charge system, only the main contractor will collect VAT from the customer to pass on to HMRC, rather than each party in the supply chain paying VAT to HMRC and claiming back their share.

You can read more here: https://www.gov.uk/government/publications/revenue-and-customs-brief-7-2020-domestic-reverse-charge-vat-for-construction-services-delay-in-implementation/revenue-and-customs-brief-7-2020-domestic-reverse-charge-vat-for-construction-services-delay-in-implementation

New Addition to the Hillmans Team

We're pleased to introduce Sophie Taylor who has joined Hillmans as an office administration apprentice from Weston College. 

Sophie will be assisting with administration, customer service and of course offering a warm welcome to visitors 🙋‍♀‍☺‍

Welcome to the Hillmans Team Sophie! 👋

Weekly Update 5th June 2020

Weekly Update 5th June 2020

Below I have summarised all the main tax related updates we have seen this week. 

• Deadline for applying for the Discretionary Grants Fund – 8th June 2020

• Part Time Furloughing and Key Date of the 10th June 2020

• Defer your Self Assessment payment on account due to coronavirus

• Our Worle office is now reopen!

I’m away from the office on annual leave next week for a bit of home DIY and garage tidy-up, but if you need any support or advice please do not hesitate to contact the team. 

I hope you have a great weekend!

Stay safe and well. 

Best wishes,

Steve

Steven Hillman ACA

Chartered Accountant

Tel: 01934 444100

https://www.hillmans.co.uk/covid-19-updates 

Deadline for applying for the Discretionary Grants Fund – 8th June 2020

The deadline is fast approaching for making an application for the North Somerset Discretionary Grants Fund.  

Businesses can apply before 23:59 on the 8th June 2020. 

Small businesses in North Somerset, which have yet to receive financial support during the coronavirus crisis, can apply for additional funding following an announcement from central Government.

 

A grant of £2.1 million has been awarded to North Somerset Council as part of a new Government Discretionary Grants Fund, and will offer financial support to small businesses that can demonstrate:

• they have suffered a significant fall in income because of the Covid-19 pandemic

• have fixed property-related costs 

• employ fewer than 50 employees

Organisations applying for the fund must have been trading on 11th March, 2020 and not have received any other Government funding. 

Cllr Mark Canniford, Executive Member for Business, Economy and Employment at North Somerset Council, said: “We understand all businesses are finding life extremely hard, but the Government is asking councils to prioritise the following types of businesses: 

• small businesses in shared offices or other flexible workspaces

• regular market traders who do not have their own business rate assessment

• bed and breakfasts (excluding Airbnb) which pay council tax instead of business rates

• charity properties that receive charitable business rates relief, which would otherwise have been eligible for small business rates relief or rural rate relief

For more detail please refer to the full guidance for small business grants here: https://www.n-somerset.gov.uk/wp-content/uploads/2020/05/small-business-grants-discretionary-fund-guidance.pdf 

You can apply here: https://innorthsomerset.co.uk/covid-19-support/small-business-grants-information/

Part Time Furloughing and Key Date of the 10th June 2020

Key Date - 10th June 2020

Following the Governments update for the furlough scheme on Friday, a key date has been updated, the 10th June 2020.

Its important to note the furlough scheme will close to new entrants from the 30th June 2020. From this date onwards, employers will only be able to furlough employees that they have furloughed for a full 3 week period prior to 30th June 2020.

This means that the final date by which an employer can furlough an employee for the first time will be 10th June 2020, in order for the current 3 week furlough period to be completed by the 30th June.

Employers will have until 31st July 2020 to make any claims in respect of the period to the 30th June.

Part Time Furloughing

From 1st July 2020, employers using the scheme will have the flexibility to bring previously furloughed employees back to work part time – with the government continuing to pay 80% of wages for any of their normal hours they do not work up until the end of August. This flexibility comes a month earlier than previously announced to help people get back to work.

Employers will decide the hours and shift patterns their employees will work on their return and will be responsible for paying their wages in full while working. This means that employees can work as much or as little as the business needs, with no minimum time that they can furlough staff for.

Any working hours arrangement agreed between a business and their employee must cover at least one week and be confirmed to the employee in writing. When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of a week. They can choose to make claims for longer periods such as on monthly or two weekly cycles if preferred. Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.

If employees are unable to return to work, or employers do not have work for them to do, they can remain on furlough and the employer can continue to claim the grant for their full hours under the existing rules.

Defer your Self Assessment payment on account due to coronavirus

To help ease the financial impact of the coronavirus (COVID-19), the Government announced that self-employed taxpayers may be able to defer some tax payments without paying a penalty. 

At present it is possible to:

- delay VAT payments due before 30 June 2020 until 31 March 2021;

- delay self-assessment payments on account due in July 2020 until 31 January 2021.

Taxpayers have the option to defer their second payment on account for the 2019/20 tax year if they are registered in the UK for self-assessment and finding it difficult to make a second payment by 31 July 2020, due to the impact of coronavirus.

HMRC will not charge interest or penalties on any amount of the deferred payment on account, provided it is paid on or before 31 January 2021.

Taxpayers do not need to tell HMRC that they are deferring the payment on account, and choosing to defer will not prevent them from being entitled to other coronavirus support that HMRC provide, such as grants under the Self-Employment Income Support Scheme (SEISS).

The second payment on account must be made on or before 31 January 2021 if people choose to defer and there is concern around the tax and accountancy professions that deferment may have a knock-on 'snowball effect'. Whilst deferral will give an element of 'breathing space' in the short term, it may store up bigger problems in the future if liabilities continue to remain unpaid. HMRC confirm that the usual interest, penalties and debt collection procedures will apply to missed payments.

Taxpayers should note that other payments which may need to be paid by 31 January 2021 include any balancing payment due for the 2019/20 tax year, and first payment on account due for the 2020/21 tax year. 

For further information on payments, taxpayers can sign in to their HMRC online account, or if you're a Hillmans client we can check this for you. 

You can read more here: https://www.gov.uk/guidance/defer-your-self-assessment-payment-on-account-due-to-coronavirus-covid-19

Our Worle office is now reopen

We are excited to have reopened our Worle office today!

We have adapted the office to ensure both our team and clients feel safe and reassured by the measures we have put in place. To ensure the safety of our team, there will be a maximum of two team members allowed in the office building at any one time. Each team member will have their own office, bathroom, and kitchen area for their personal use. The rest of the Hillmans team will continue to work from home for the time being.

Many thanks to our suppliers AFS and Safety EPOS for helping us get Covid-19 safe with the sneeze guard safety screen, social distancing markings and hand sanitation facilities for the visitor reception and office areas. 

 

We appreciate not all our clients are comfortable or able to use online HMRC (.GOV) facilities, so we are pleased to be able to assist our clients personally in the office once again (subject to safe social distancing). This will be achieved by our updated visitor reception area benefiting from a safety Sneeze Guard screen, enabling us to safely assist clients in-person. 

Whilst we will be open for the drop off and collection of client records and post, together with assisting clients who need personal assistance with HMRC online facilities and services, we do anticipate these visits will be kept to the minimum time possible. All accounts and tax return review meetings, together with consultations with Steve and the team, will continue to be held over the phone or via video calls at present. 

Our Worle office will be open Monday to Friday, 9am to 5pm, however we will of course follow Government guidance and if any changes are needed to our opening hours or method of operation, we will provide updates on our blog and social media channels.

It will be great to see you all again, albeit in a slightly different way for the time being! 😊