AIMS Accountants – Information for Clients During Covid-19

/ AIMS, AIMS News, Business and Economy, Government, SME

Author: Henry Ejdelbaum

Tags: Coronavirus, hmrc, small business

New details of help and assistance for businesses aimed at mitigating the financial impact of COVID-19 are appearing every day. We wanted to outline some of the measures which have been put in place which might impact business owners. For further information, you can always contact your local AIMS accountant.

Please note that this is a rolling blog, which will be added to frequently when we have further updates

Thursday 14th May

Furlough Scheme Extension 

The Government has announced changes to the CJRS from August. Details are a bit thin on the ground but the key points announced are:

  • The scheme will be extended to October.
  • Employers will have to contribute towards furlough pay
  • Employers currently using the CJRS will be able bring back workers part time and furlough them for the rest of the time.

Monday 4th May

Bounce Back Loan Scheme

The Bounce Back Loan Scheme (BBLS), launched on Monday 4th May. it provides financial support to businesses across the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak and that can benefit from £50,000 or less in finance. Lenders can provide a six-year loan from £2,000 up to £50,000, dependent on the business’ turnover.

Thursday 30th April

Further Support from Scottish Government

The Scottish Government has announced two further areas of support. The £20m Creative, Tourism & Hospitality Enterprises Hardship Fund, aimed at “supporting businesses in these sectors which are not entitled to receive existing support measures”, and the £45 million Pivotal Enterprise Resilience Fund, assisting businesses that are vital to local and national prosperity with cash flow.

Tuesday 28th April

Small Business Loans

The Government has announced that they will be providing small business loans of up to £50,000 which were 100% backed by the government. Details of the scheme are not expected to be released until next week, but the plan is to have firms being able to draw down loans quickly, by filling in a self-certification form.

This is to run alongside the existing CBILS scheme.

Monday 20th April

Job Retention Scheme

The Job Retention Scheme is now open to small businesses.

For further details, speak to your local AIMS accountant.

Support for Start-Ups

The Government has announced a £1.25bn support package aimed at start-ups. They will match up to £250m of private investment and add £550m to an existing loan and grant scheme for smaller firms focusing on research and development. Further details are expected, but in order to qualify, firms must have raised £250,000 privately in the last five years, and any funds from the Government need to be matched by private investors. The Government will take an ownership stake in any company which does not repay the money.

We will be running a webinar on Friday 24th April at 10:30am to provide an overview of the support available to small businesses.

Thursday 16th April

Job Retention Scheme

The scheme is now open to employers with a PAYE scheme in place at 19/03/2020 (the deadline was previously 28/02/2020).

Second Phase of Funding from the Scottish government

The Scottish Government has announced a further £220m in grants for small businesses. This package includes £120m to extend the Small Business Grant Scheme to ensure that as well as a 100% grant on the first property, small business rate payers will be eligible to a 75% grant on any subsequent properties. A further £100m is being made available for the self-employed, and viable micro and SME businesses who are ineligible for other UK Government schemes. Businesses would need to apply for the fund, with the Government to receive applications on 5 May.

Wednesday 15th April

HMRC Chief Jim Harra, has announced on Radio 4 that all businesses will have access to the Job Retention scheme by Monday 20th April, and that tests of using the site had worked well.

AIMS Webinar – Outlining Government Support Measures

On Wednesday 15th April, AIMS will be hosting a webinar for small businesses, outlining the Government Support measures and how businesses can benefit from them. Further information can be found here

Thursday 9th April

Support for Charities

The Government announced a £750m package to assist charities during Covid-19. Further details are still to be announced, but the scheme will involve £360m being allocated by Government departments to charities providing key services, and £370m to small local charities. We will provide further information once it becomes available.

Monday 6th April 2020

The Government have clarified that in some circumstances, salaried company directors are eligible to be furloughed, and therefore to receive support under the job retention scheme. There are some limitations on this, for example, the board will need to consider that it is in compliance with the statutory duties of one or more of its individual salaried directors. The decision needs to be formally adopted as a decision of the company (e.g. noted in the company records, and communicated in writing. It is also important that directors not carry out any kind of work which would generate commercial revenue).

For further details, speak to your local AIMS accountant.

Thursday 2nd April 2020

HMRC have revealed an increase in the number of phishing scams in relation to Government support measures for small businesses effected by Covid-19. Further details can be found here.

Friday 27th March 2020

The Government has provided further information about the support measures for the self employed

Self-employment Income Support Scheme

The Scheme is open to all self-employed individuals or partners, who:

  • Have submitted their 2018-19 self-assessment return by 23rd April 2020
  • Traded in 2019-2020
  • Intend to continue trading (or resume trading) in 2019-2020
  • Have lost profits due to Covid-19
  • Profits must be less than £50,000 and these profits constitute more than half of your total taxable income (either for 2018/19 or for the average of the last three years according to self-assessments)

HMRC will contact those eligible to claim, and those who qualify can receive a taxable grant of 80% of the average profits for the years in which the trade was carried on between 2016/2017 and 2018/2019, capped at £2,500 a month for 3 months. This is payable in a single instalment

The Government have indicated that the scheme will be available from June.

Further Information about the Job Retention Scheme:

Further details have been provided by the Government regarding the Job Retention Scheme, including:

  • Furloughed pay, will still be subjected to tax and National Insurance
  • The minimum period that can be claimed for is 3 weeks
  • Employees must have been on the company payroll as of 28th February 2020 to qualify
  • Bonuses, commissions and fees are not included as monthly earnings

Scams

Note that if somebody texts, e-mails or calls claiming to be from HMRC, and asks you to click on a link or provide personal information such as credit card or bank details, then it might be a scam, and businesses should be on alert.

Wednesday 25th March 2020

VAT Deferral – Businesses do not need to make a VAT payment between 20th March 2020 and 30th June 2020, as this will be deferred and need not be paid before 05/04/2021. HMRC say that customers who normally pay their VAT by Direct Debit who wish to defer payment must cancel their DD authority in good time to avoid HMRC’s automatic systems collecting the money. DDs must be cancelled via the businesses’ banks or their HMRC online account, there is no facility for agents to do the cancellation.

Business grants – An outline of the grants available is below (18/03/2020 and 19/03/2020). Details of how to access the grants have now become available:

  • In England and Wales Local authorities will pay the grants using their Business Rate information. There is no need to contact the Local Authorities, they will contact businesses as necessary.
  • Businesses in Scotland have to make a claim to their local Council; forms are available on the various Council websites (search Corona virus and/or business support). Links to Council websites can be accessed here 

Tuesday 24th March 2020

The Government provided updated advice about the types of business which attract the business rates holiday. Those which are eligible include:

  • Art Galleries, Bars, Car Hire, Caravan Parks, Charity Shops, Cinemas, Clubs, Coffee Shops, Dry Cleaners, Display rooms, Garden centres, Gyms, Hair and Beauty, Holiday Homes, Hotels, Shops, Launderettes, Music Venues, Markets, Opticians, Appliance Repair, Petrol Stations, Post Offices, Pubs, Restaurants, Shoe repairs, Leisure Facilities, Stately Homes, Takeaways, Theatres, Tourist Attractions, Travel Agents and Others

Those which are ineligible include:

  • Casinos, Financial Services, Medical Services, Estate Agents, Post Office Sorting Offices, Professional Services, Premises not accessible to visiting members of the public

For further information, you can always contact your local AIMS accountant.

Monday 23rd March 2020

The following measures were announced:

  • The Coronavirus Job Retention Scheme, which is to encourage businesses to hang onto workers for whom they have no work.
  • It provides firms with 80% of the wage costs of employees kept on but not working (furloughed workers), up to a maximum of £2,500 per worker to be reimbursed.
  • It will be administered by HMRC

Thursday 19th March 2020

The Government announced measure for small businesses in Scotland including:

  • Small firms receiving the small business bonus or rural relief will be eligible for a £10,000 grant
  • 12 months relief for businesses in hospitality, leisure and retail. Grants will also available for companies in this sector
  • A £25,000 grant for buildings in those sectors with a rateable value between £18,000 and £51,000

Wednesday 18th March 2020

The Government has introduced a variety of measures to assist small businesses including:

  • Statutory Sick Pay (SSP) covers necessary self-isolation as well as actual sickness. And the Government has announced that in some cases employers with fewer than 250 staff can reclaim up to 14 days SSP per employee
  • Small Business Rate Relief has been increased to 100% for small businesses below a rateable threshold (£15,000).
  • Additional grants will be available and businesses will be contacted by their local authority
  • A 12-month business rates holiday for businesses in the retail leisure and hospitality sectors
  • The announcement of the Coronavirus Business Interruption Loan Scheme, providing government backed loans of up to £5 million for small businesses, with a 6-month interest free holiday.
  • A new helpline (Time to Pay) to assist small business with problems paying taxes to HMRC
  • The Government has also announced that they have postponed the extension of IR35 into the private sector for a year. This was due to start on 6th

If you want to find out more about any of the above measures, speak to your local AIMS accountant.