Our COVID-19 Weekly Roundup

Given the number of Coronavirus business related updates which have been released this week, we felt it would be useful to consolidate the current position as we go into the weekend.

Below are the main areas of support for companies and the self-employed.

General government schemes applying to Scottish businesses

HMRC Coronavirus Helpline
This number is designed to support businesses and the self-employed – 0800 024 1222

Grant support
Local authorities have Coronavirus Business Support Fund grants of £10,000 or £25,000 potentially available. The details can be accessed from your local authority website by searching Business Support Fund.

Coronavirus Business Interruption Loan Scheme
This scheme aims to provide funding for businesses who require additional financial support. The Government will support loans up to £5m. Loans and asset finance are up to six years and overdraft/invoice finance facilities are up to 3 years. If you wish to take advantage of this scheme, we would suggest getting in touch with your bank immediately.

You can read more on our article here.

Coronavirus Job Retention Scheme
All UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been made redundant during this crisis. This scheme is expected to be running by the end of April 2020 and any payments can be backdated to 1 March 2020.

In order to claim, you will need to designate employees as ‘furloughed workers’ and notify employees of this change. Furloughed staff must not work for the employer during the enforced break, doing so invalidates the potential support. We believe the payroll will be processed as normal and then HMRC will provide a grant for 80%. You can click on this link to view the English Accounting Institute website which provides some worked examples to review.

Full details of the Coronavirus Job Retention Scheme can be found here.

VAT
Any VAT payable between 20 March and 30 June need not be paid and instead can be deferred until the end of the financial year, typically 31 March 2021, depending on your VAT quarter periods. Although this is an automatic offer, if you wish to take advantage of this and currently pay via direct debit, your direct debit should be cancelled as otherwise the funds may still be collected by HMRC automatically. You can read more in our article here.

Tax time to pay arrangements
Recent experience has shown HMRC to be sympathetic to requests for time to pay tax bills whether that be PAYE, corporation tax or income tax. Remember too that 31 July 2020 self assessment tax payments can be deferred until 31 January 2021 also.

Government support for Limited Companies and Directors

Owners/Directors
The position is also clarified to some extent. For our limited company clients, we understand that your salaries will be eligible for the 80% funding support but that your dividends will not. That guidance sits in the self employment announcements and the guidance for employers guidance both supplied above. This does seem unfair to many hard working small business owners, and we recommend you lobby for this to be altered – FSB, Cheqs of Commerce, local MPs and any other business associations of which you are a member may have a role to play.

Companies House filing deadlines
As with HMRC, Companies House are being lenient with financial statement lodging dates. A deferred filing deadline can be applied for via the Companies House website and in our experience, an extension of 3 months is being applied instantly if requested online. If you would like more information, please follow the link here or give us a call.

Government support applying to the self employed

Self-employed Grants
For the self-employed, that is sole traders or partners, Thursday’s announcements provided clarification that the 80% reimbursement will apply to those with profits up to £50,000, averaged over a 3 year period up to and including your 2018/19 tax return. If the 2018/19 tax return has not yet been submitted then this must be done before 23 April 2020 in order to be eligible for the scheme. HMRC will contact you directly if it believes you are eligible with details on how to apply and so there is no need to contact HMRC directly at this time. The payments are expected to be made early June although will backdated to 1 March 2020. You can read more on the Governments website here.

Self employed – Income tax payments
Income tax payments due in July 2020 under the self-assessment system will be deferred to January 2021. This is an automatic offer with no application required.

You can read more about financial support for the self-employed in our article here.

It’s been an amazing week for all of us, and uplifting to see businesses and the wider community coming together to support each other in their hour of need.

EQ are here to help you through this extraordinary time and wish you all a peaceful, relaxing weekend. Should you wish to discuss any of the above, please get in touch on Monday.