December 2021 COVID Update

December 2021 COVID Update:In view of the latest Government COVID guidelines, our staff that are able to work from home will do so with effect from Monday 13th December 2021. 

However, our Worle office remains open with a skeleton staff, and all staff can be contacted on the normal number (01934 444100). 

Our reception is open for deliveries of post, books and records.

In view of the current uncertainty regarding the Omicron COVID variant, we will be offering meetings via telephone call or Zoom video call in place of in-person meetings until the Government guidance is updated. 

Fifth Self-Employed Income Support Grant to be paid in July

The fifth (and final) SEISS grant will be available for the self-employed to claim towards the end of July.

The eligibility criteria remain broadly the same as the fourth grant. Self-employed profits in 2019/20 must not exceed £50,000 and must be more than 50% of your total income. If that test is not met, then the same £50,000 and 50% tests are applied to average profits and total income over the four fiscal years to 2019/20.

Self-employed traders need not have claimed grants under the previous scheme to qualify for the July payment and will be required to confirm that their business continues to be adversely affected by Covid-19. The amount that traders will be able to claim will depend on how much their turnover has reduced by. If the reduction is more than 30% the grant will be 80% of average profits capped at £7,500 but if less than 30% only 30% of average profits, capped at £2,850.

We are still waiting for more details from HMRC on the basis for the turnover comparison.

The cost of Covid-19 and how this will affect your business

The cost of Covid-19

The ONS has published its latest paper on how the relationship between UK public sector monthly income and expenditure leads to changes in deficit and debt for the financial year ending 31 March 2021. The figures are subject to adjustment but show the stark reality of the effect of Covid-19 on the UK economy and the extent of government support

• Public sector net borrowing (excluding public sector banks) in the financial year ending (FYE) March 2021 is estimated to have been £303.1 billion, £246.1 billion more than in the year to March 2020 and the highest nominal public sector borrowing in any financial year since records began in 1947.

• Expressed as a ratio of gross domestic product (GDP), public sector net borrowing (excluding public sector banks) in the FYE March 2021 was 14.5%, the highest such ratio since the end of World War Two, when in FYE March 1946 it was 15.2%.

• Public sector net borrowing (excluding public sector banks) in the FYE March 2021 is estimated to have been £24.3 billion less than the £327.4 billion expected by the Office for Budget Responsibility in their Economic and Fiscal outlook – March 2021 on a like for like basis.

• Central government tax receipts are estimated to have been £523.6 billion in the FYE March 2021 (on a national accounts basis), £34.2 billion lower than in the FYE March 2020, with notable falls in taxes on production such as Value Added Tax (VAT), Business Rates and Fuel Duty.

The full ONS report can be seen here: https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance/bulletins/publicsectorfinances/march2021 

How will this affect your business?

We saw in the last budget the steps the government is taking to support the recovery with new incentives for business investment and help for businesses to attract the capital, ideas and talent to grow. Once economic recovery is durably underway, the recent budget stated that the public finances must be returned to a sustainable path and sets out the size of the challenge and steps to deliver more sustainable public finances. So in March we saw Chancellor Rishi Sunak freeze income tax thresholds and announce an increase in Corporation tax rates from 2023.

The government has chosen a fine line between raising taxes to start paying down the massive government borrowings but at the same time stimulate economic recovery and save jobs.

Most businesses will be focussing short term on their recovery and in the medium term on being resilient, improving profitability and growing turnover. If taxes do rise to fund government spending, we recommend all businesses should map out a range of scenarios with “what if” analysis to understand their available future strategies for success. 

Tell HMRC and pay back a Self-Employment Income Support Scheme grant

Find out what to do if you need to pay back some or all of a SEISS grant. You must tell HMRC if, when you made the claim, you were not eligible for the grant. For example:

• for the first or second grant, your business was not adversely affected
• for the third or fourth grant, your business had not been impacted by reduced activity, capacity or demand or inability to trade in the relevant periods
• you did not intend to continue to trade
• you have incorporated your business
• You must also tell HMRC if you:
• received more than they said you were entitled to
• amended any of your tax returns on or after 3 March 2021 in a way which means you are no longer eligible or are entitled to a lower fourth grant than you received.

See:  Tell HMRC and pay back a Self-Employment Income Support Scheme grant https://www.gov.uk/guidance/tell-hmrc-and-pay-the-self-employment-income-support-scheme-grant-back

Penalties for not telling HMRC about coronavirus (COVID-19) support scheme overpayments - CC/FS11a

If you have received a grant but were not eligible or you have been overpaid, find out about penalties you may have to pay if you do not tell HRMC.

See:  Penalties for not telling HMRC about coronavirus (COVID-19) support scheme overpayments - CC/FS11a - https://www.gov.uk/government/publications/penalties-for-not-telling-hmrc-about-coronavirus-covid-19-support-scheme-overpayments-ccfs11a

Further easing of Covid restrictions from today - 12th April

Outdoor hospitality will be among those reopening today (12th April) in England next after the Prime Minister confirmed the roadmap is on track and planned easements can go ahead.

Further parts of the indoor economy and outdoor settings will reopen from 12 April, after data confirmed the government’s “four tests” for easing Covid restrictions had been met.

The Prime Minister last week continued to urge caution, with no changes to social contact rules and many restrictions still in place. Outdoor gatherings must still be limited to 6 people or 2 households, and you must not socialise indoors with anyone you do not live with or have not formed a support bubble with.

Confirmation Step 2 of the roadmap would proceed came after the measures were agreed at a “Covid O” meeting and discussed on a Cabinet call last Monday.

Before proceeding to this step, the government studied the latest data to assess the impact of the first step, which began when schools reopened on 8 March.

The assessment was based on four tests:

• The vaccine deployment programme continues successfully

• Evidence shows vaccines are sufficiently effective in reducing hospitalisations and deaths in those vaccinated.

• Infection rates do not risk a surge in hospitalisations which would put unsustainable pressure on the NHS.

• Our assessment of the risks is not fundamentally changed by new Variants of Concern.

As set out in the roadmap, around four weeks is required to see the impact in the data of the previous step.

The government also committed to provide a further weeks’ notice to businesses, provided through the update from the Prime Minister.

From today, additional premises will be able to reopen – with the rules on social contact applying. Indoor settings must only be visited alone or with household groups, with outdoor settings limited to either six people or two households.

This includes non-essential retail; personal care premises such as hairdressers, beauty and nail salons; and indoor leisure facilities such as gyms and spas (but not including saunas and steam rooms, which are due to open at Step 3).

Overnight stays away from home in England will be permitted and self-contained accommodation can also reopen, though must only be used by members of the same household or support bubble.

Public buildings such as libraries and community centres will also reopen.

The majority of outdoor settings and attractions can also reopen, including outdoor hospitality, zoos, theme parks, drive-in cinemas and drive-in performances events.

Hospitality venues will be able to open for outdoor service, with no requirement for a substantial meal to be served alongside alcohol, and no curfew. The requirement to eat and drink while seated will remain.

People should continue to work from home where they can and minimise domestic travel where they can. International holidays are still illegal.

The number of care home visitors will also increase to two per resident, and all children will be able to attend any indoor children’s activity, including sport, regardless of circumstance.

Parent and child groups of up to 15 people (not counting children aged under five years old) can restart indoors.

Funerals can continue with up to 30 attendees. Weddings, outdoor receptions, and commemorative events including wakes will be able to take place with up to 15 attendees (in premises that are permitted to open).

The government is also publishing an update on the 4 reviews established in the roadmap to determine what measures may be necessary from summer onwards.

See: Further easing of Covid restrictions confirmed for 12 April - GOV.UK (www.gov.uk)

New - The Restart Grant Scheme

A New grant scheme launched last week: The Restart Grant scheme supports businesses in the non-essential retail, hospitality, leisure, personal care and accommodation sectors with a one-off grant, to reopen safely as COVID-19 restrictions are lifted.

Eligible businesses in the non-essential retail sector may be entitled to a one-off cash grant of up to £6,000 from their local council.

See: Check if you're eligible for a coronavirus Restart Grant - GOV.UK (www.gov.uk)

Health and Safety Spot Checks and Inspections During Coronavirus

We have heard from a number of clients that the Health and Safety Executive (HSE) is carrying out spot checks and inspections on all types of businesses in all areas to ensure they are COVID-secure.

HSE are making calls to businesses so they can give advice on how to manage the risks and protect workers, customers and visitors. They are also working closely with local authorities, assisting them in the sectors they regulate such as hospitality and retail.

HSE state that Inspectors will make COVID-secure checks as part of their normal role in visiting workplaces during the pandemic. To ensure they reach as many workplaces as possible nationally and support the core work of inspectors, they are working with trained and approved partners to deliver the spot check calls and visits.

Officers that visit premises will be carrying identification from their business and a letter of authorisation from HSE. If you wish to verify an officer that calls or visits your organisation, please call 0300 790 6896.

See: https://www.hse.gov.uk/coronavirus/regulating-health-and-safety/spot-inspections.htm

Pay VAT deferred due to COVID-19

Information has been added by HMRC about how to join the VAT deferral new payment scheme – with the online service being open between 23 February and 21 June 2021.

If you deferred VAT payments due between 20 March and 30 June 2020, and still have payments to make, you can:

• pay the deferred VAT in full, on or before 31 March 2021.
• join the VAT deferral new payment scheme – the online service is open between 23 February and 21 June 2021.
• contact HMRC on Telephone: 0800 024 1222 by 30 June if you need extra help to pay.

You may be charged interest or a penalty if you do not:

• pay the deferred VAT in full by 31 March 2021.
• opt into the new payment scheme by 21 June 2021.
• agree extra help to pay with HMRC by 30 June 2021.

See: https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19

Announcement of Further Business Support Grants

The Chancellor this morning announced one-off top up grants for retail, hospitality and leisure businesses worth up to £9,000 per property to help businesses through to the Spring. In addition there is a £594 million discretionary fund also made available to support other impacted businesses.

The grants will be provided on a per-property basis to support businesses through the latest restrictions, and is expected to benefit over 600,000 business properties, worth £4 billion in total across all nations of the UK. A further £594 million is also being made available for Local Authorities and the Devolved Administrations to support other businesses not eligible for the grants, that might be affected by the restrictions. Businesses should apply to their Local Authorities. The one-off top-ups will be granted to closed businesses as follows: • £4,000 for businesses with a rateable value of £15,000 or under • £6,000 for businesses with a rateable value between £15,000 and £51,000 • £9,000 for businesses with a rateable value of over £51,000 • any business which is legally required to close, and which cannot operate effectively remotely, is eligible for a grant Business support is a devolved policy and therefore the responsibility of the devolved administrations, which will receive additional funding as a result of these announcements in the usual manner: • the Scottish Government will receive £375 million • the Welsh Government will receive £227 million • the Northern Ireland Executive will receive £127 million We will keep you up to date with further details as and when the Governments release information.

New Penalties for Overclaimed Grants

HMRC have announced that they will be imposing penalties of up to 100% of the amounts overclaimed on CJRS, SEISS and Eat Out to Help Out Grants. 

The penalties depend on whether or not the overclaim is the result of a deliberate error and whether or not the disclosure was prompted by HMRC. The penalty may be reduced where the taxpayer assists HMRC in correcting the error.

Many overclaims may be the result of careless errors or a misinterpretation of the rules which have changed many times in the last 9 months so we hope that HMRC will apply the rules with a light touch and focus on those that have abused these schemes.

We understand that HMRC are writing to 4,000 catering establishments that they suspect may have overclaimed under the “Eat out to help out” scheme that ran in August.  Traders are being asked to check their claims and respond within 60 days or face an HMRC compliance check.

What Hope For The Recovery?

The latest economic indicators for the UK economy from the Office for National Statistics (ONS) show 77% of UK businesses are currently trading, with 14% of trading business’ workforce on furlough leave. Their latest figures show that monthly gross domestic product (GDP) rose by 0.4% during October 2020 but was still 7.9% below February 2020 levels.

Output is expected to shrink again in November after England's second shutdown forced many businesses to close.

October 2020 saw the sixth consecutive month of growth, but the rate of recovery has slowed each month since the largest rise of 9.1% in June 2020. Across services, the monthly growth was driven by health, wholesale, retail and motor trades, and education, while accommodation and food and beverage service activities declined. Within manufacturing there was widespread growth, led by a rise of 6.8% in motor vehicle production. Monthly construction output growth slowed to 1.0% in October 2020, the sixth consecutive month of growth but the lowest rise in that time, with the level of construction output in October 2020 still 6.4% below the February 2020 level.

The figures are gradually improving although it is going to be a long haul. It is clear the hospitality, travel, arts and retail sectors are hardest hit and whilst there are regional grants to support them we believe these sectors will take the longer to recover. 

A “No Deal” Brexit will have a negative impact on the economy in early 2021 and any recovery will take longer as a result. The Confederation of British Industry (CBI) predict the UK won’t get back to its pre-pandemic level until the end of 2022 and if there is “No Deal” this could take up to 2024.     

Despite the pandemic and the possibility of “No Deal”, we still continue to be impressed with the resilience of our clients and how they have energetically repurposed or pivoted their businesses into new areas, products and services. 

Please do talk to us about planning for 2021 and beyond, we have considerable experience in helping businesses project their figures forward and perform “What if” analysis to look at a range of scenarios. 

Claim a Grant Through The Self Employment Income Support Scheme

The third grant for SEISS is now open. To make a claim for the grant, your business must have been impacted by coronavirus on or after 1st November 2020. You can make a claim for the third grant if you are eligible, even if you did not make a claim for the first or second.   

What you will need to make your claim

You will need your:

• Self-Assessment Unique Taxpayer Reference (UTR)

• National Insurance number

• Government Gateway user ID and password

• UK bank details including account number, sort code, name on the account and address linked to the account

You may also need to answer questions about your passport, driving licence or information held on your credit file.        

You must make your claim between 30th November 2020 and 29th January 2021 using the government website below.

See: https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income-support-scheme

Nightclubs, Dance Halls, or Adult Entertainment Businesses

Businesses that have been required to close due to the national restrictions introduced in March 2020, and which have not been able to re-open, may be eligible for LSRG (Sector).

Eligible businesses are entitled to a cash grant from their local council for each 14-day period they are closed. This funding is available from 1 November 2020 and is not retrospective.

Eligibility

Eligible businesses include:

·                     nightclubs, dance halls, and discotheques

·                     adult entertainment venues and hostess bars

Your business may be eligible if it:

·                     is based in England

·                     occupies property on which it pays business rates (and is the ratepayer)

·                     has been closed since 23 March 2020 because of national restrictions

Eligible businesses can get one grant per non-domestic property.

The grant will be based on the rateable value of your property on 1 November 2020.

If your business has a property with a rateable value of £15,000 or less, you may be eligible for a cash grant of £667 for each 14-day period your business is closed.

If your business has a property with a rateable value over £15,000 and less than £51,000, you may be eligible for a cash grant of £1,000 for each 14-day period your business is closed.

If your business has a property with a rateable value of £51,000 or above, you may be eligible for a cash grant of £1,500 for each 14-day period your business is closed.

The grant will be extended to cover each additional 14-day period of closure. If your business is closed for 28-days, or 2 payment cycles, it will receive £1,334, £2,000 or £3,000, depending on the rateable value of the property.

See: https://www.gov.uk/guidance/check-if-your-nightclub-dance-hall-or-adult-entertainment-business-is-eligible-for-a-coronavirus-grant-due-to-national-restrictions

Covid-19 Business Planning Advice

As we enter the third week of lockdown in England and reflect on improved testing, new vaccine trial results and a host of experts talking on the news about the timing of rollout and when Covid-19 will no longer be a threat to normality, it is worth remembering our lives are and will remain different for the remainder of 2020 and most of 2021. With that in mind we need to be resilient as individuals, families and businesses. 

The latest indicators for the UK economy found nearly half (49%) of currently trading UK businesses reported a decrease in their turnover below what is normally expected for this time of year. On 8 November, overall UK footfall dropped to 33% of the level seen on the equivalent day last year as national restrictions were introduced in England. 

Clearly we are living in tough times and it makes sense to take advantage of Government supports both directly such as the extended job retention and self-employed support schemes, deferring tax and using bounce back loans. There are also grants available to help firms with Brexit changes for import and export administration.

We have helped many businesses apply and claim for these supports and if you need any assistance, please contact us.

Business planning for 2021 will be difficult as we don’t know the timings for mass vaccinations and whether they will truly work but there are some practical steps you can take to minimise potential disruption to your business:

1. Review your Budgets and set realistic and achievable targets for the remainder of 2020 and for 2021.

2. Get your employees involved in a discussion of likely trading conditions and get their input on reducing costs and maintaining revenues.

3. Use ‘bottom up’ budgeting where everyone in the business gives input on areas over which they have control – target a 10% cost saving.

4. Review and flowchart the main processes in your business (e.g. Sales processing, order fulfilment, shipping etc.) and challenge the need for each step.

5. Encourage team members to suggest ways to streamline and simplify processes (e.g. sit down and brainstorm about efficiencies and cost reduction).

6. Put extra effort into making sure your relationships with your customers are solid.

7. Review your list of products and services and eliminate those that are unprofitable or not core products/services.

8. Review efficiency of business processes and consider alternatives such as outsourcing certain activities locally or overseas.

9. Agree extended payment terms with all suppliers in advance.

10. Pull everyone together and explain the business strategy and get their buy-in.

Please talk to us about cashflow planning for the next six months, we can help with a template so you can do this yourself or work together to produce estimates for a variety of scenarios.

All the best,

Steve

Steven Hillman ACA
Chartered Accountant
Tel: 01934 444100

6th November 2020 – Hillmans Weekly Update

I hope you are keeping safe and well.

6^th November 2020 – Hillmans Weekly Update

 

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

 

·         New Financial Support for Jobs and Businesses

·         Summary of the new lockdown measures for England

·         Top up your Bounce Back Loan

·         Airbnb Reporting Property Rental Details to HMRC

 

My team and I will continue to provide clients with an uninterrupted service during the second lockdown, so if you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact us.

 

I hope you have a good weekend.

 

Stay safe and well.

 

Best wishes,

 

Steve

 

Steven Hillman BSc (Hons) ACA

Chartered Accountant

Tel: 01934 444100

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

New Financial Support for Jobs and Businesses

The Government has made yet further announcements this afternoon (which supercede some of the guidance advised earlier in the week). The headline news for clients to be aware of is that the Government will: - Extend the Furlough Scheme (Coronavirus Job Retention Scheme) until the end of March 2021

-Not pay the Job Retention Bonus in February 2021 but instead redeploy a retention incentive at some future point -Increase the third self-employed grant, covering November to January, from 55% to 80% of trading profits As always if you have any queries please don't hesitate to drop me a line. All the best, Steve Steven Hillman ACA Chartered Accountant Tel: 01934 444100

New Lockdown Measures for England

Prime Minister Boris Johnson announced over the weekend a second national lockdown for England to prevent a "medical and moral disaster" for the NHS.

Pubs, restaurants, gyms and non-essential shops will close for four weeks from Thursday 4 November, he said. Schools, colleges and universities will stay open.

Summary of the new lockdown measures for England:

• People should stay at home unless they have a specific reason to leave, such as work which cannot be done from home and education
• People are allowed to leave home for exercise, medical reasons, food and other essential shopping 
• Providing care for vulnerable people or for volunteering is permitted
• Meeting indoors or in private gardens is not allowed
• Construction sites and manufacturing workplaces can remain open
• Leisure and entertainment venues, including gyms, will close
• Individuals can meet one other person from another household outside in a public place
• Pubs, bars, restaurants and non-essential retail across the nation will close - takeaways and click-and-collect shopping remain open
• People are still allowed to form support bubbles - single adults living alone - or single parents whose children are under 18 - can form a support bubble with one other household
• Children can move between homes if their parents are separated
• Clinically vulnerable people are asked to be "especially careful" and people are not being asked to resume shielding

Stay safe and rest assured we will keep all our clients fully informed of the new measures and how to claim as we get further details. 

30th October 2020 – Hillmans Weekly Update

I hope you are keeping safe and well.

30^th October 2020 – Hillmans Weekly Update

 

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

 

·         Defer your Self- Assessment payment on account due to coronavirus (COVID-19)

·         Job Retention and Bonus Schemes

·         Working Safely During COVID-19

·         Travel Corridors

 

If you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact me.

 

I hope you have a great weekend!

 

Best wishes,

 

Steve

 

Steven Hillman BSc (Hons) ACA

Chartered Accountant

Tel: 01934 444100

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

Working Safely During COVID-19

The Government has published 14 guides which cover a range of different types of work and how to work safely during Coronavirus COVID-19. 

Many businesses operate more than one type of workplace, such as an office, factory and fleet of vehicles. 

You may need to use more than one of these guides as you think through what you need to do to keep people safe. Priority actions are outlined at the top of each guide. 

The latest changes are guides for Performing Arts – updated guidance on thinking about risk (section 1) and managing performances (section 3).

See: https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19

COVID-19 News Update and Business Planning

This week has seen more discord between national and regional government in England as the new three tier system has been introduced. Wales goes into a national lockdown for a “short, sharp circuit-break” on Friday, in which people will be told to stay at home in most circumstances and the hospitality and leisure sector closing. There are new restrictions in parts of central Scotland and four weeks of tighter rules announced for Northern Ireland. We can expect more of the same over the coming months.

THE LATEST INDICATORS FOR THE UK ECONOMY AND SOCIETY

The Office for National Statistics has announced its latest experimental data on the economy which shows nearly half (48%) of currently trading businesses reported that their turnover had decreased below what is normally expected for this time of year. This is not a surprise given the Pandemic.

See: https://www.ons.gov.uk/peoplepopulationandcommunity/healthandsocialcare/conditionsanddiseases/bulletins/coronavirustheukeconomyandsocietyfasterindicators/15october2020#main-points

So, if you are running a business and turnover is down, what should you be doing to ensure resilience?

Clearly we are living in tough times and it makes sense to take advantage of Government supports both directly such as the job retention and new support schemes, deferring tax and using bounce back loans. 

There are also grants available to help firms with Brexit changes for import and export administration.

We have helped many businesses apply and claim these supports and if you need any assistance please contact us.  

BUSINESS PLANNING

Business planning for the unknown can be very difficult but there are some practical steps you can take to minimise potential disruption to your business:

1. Review your Budgets and set realistic and achievable targets for the remainder of 2020 and into the early part of 2021.

2. Get your employees involved in a discussion of likely trading conditions and get their input on reducing costs and maintaining revenues.  

3. Use ‘bottom up’ budgeting where everyone in the business gives input on areas over which they have control – target a 10% cost saving.

4. Review and flow chart the main processes in your business (e.g. Sales processing, order fulfilment, shipping etc.) and challenge the need for each step.

5. Encourage team members to suggest ways to streamline and simplify processes (e.g. sit down and brainstorm about efficiencies and cost reduction).

6. Put extra effort into making sure your relationships with your customers are solid.

7. Review your list of products and services and eliminate those that are unprofitable or not core products/services.

8. Review efficiency of business processes and consider alternatives such as outsourcing certain activities locally or overseas.

9. Agree extended payment terms with all suppliers in advance.

10. Pull everyone together and explain the business strategy and get their buy-in.

Please talk to us about cash flow planning for the next six months, we can help with a template so you can do this yourself (see below) or work together to produce estimates for a variety of scenarios.

FREE CASH-FLOW TEMPLATE

In order to help with this we are making available a basic cash-flow forecast template to anyone who needs it. You can download the template free of charge from our website here: https://www.hillmans.co.uk/cash-flow-template