Category: Uncategorised
CJRS extended to 30 April 2021
In a partial repeat of the announcement made by the Chancellor on 5 November 2020, the government has announced extensions to the furlough scheme and three of its business loan schemes:
- The Coronavirus Job Retention Scheme (CJRS) has been extended by a further month to 30 April 2021. The furlough scheme will continue to pay 80% of wages up to £2,500 for the hours that furloughed or flexi-furloughed employees don’t work. Employers will pay employer National Insurance Contributions and pension contributions.
- As a consequence, the Job Support Scheme has been deferred to start on 1 May 2021, from 1 April 2021.
- Application deadlines for the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme and Coronavirus Large Business Interruption Loan Scheme have been extended by a further two months to the end of March 2021.
Whether you’re an existing client or don’t yet use our services, we would be pleased to help you. Contact Mouktaris & Co Chartered Accountants for expert advice or click here to subscribe to our Newsletter.
Trading with the EU post Brexit
Are you ready to do business with the EU?
With just over one month to go until the end of the transition period, there will be new rules to follow when trading with the EU post Brexit, from 1 January 2021 onwards.
The UK government seems intent on following through with its “no-deal” guidance, as it stands, despite not defining in any clear terms what benefits lie beyond. What is clear, is that the global playing field has evolved- consolidated, even since one month ago. The US president-elect has expressed his discord with a disjointed Europe and in Asia, fifteen countries have formed the world’s largest trading bloc, covering nearly a third of the global economy. One would expect these factors to shape the course of dialogue in the latest round of Brexit negotiations. Let’s hope it all proves to be a big anti-climax- which at this stage may come at best only in the form of a “window dressed” political agreement of reduced or zero tariffs.
We digress. You can find out what you need to do, as a business or as a citizen, by going to gov.uk/action-2021. The top actions you need to take now are:
Check the new rules on importing and exporting goods between the EU and Great Britain from 1 January 2021
Your business could face delays, disruption or administrative costs if you do not comply with new customs procedures from 1 January 2021. We will be releasing additional guidance on trading with the EU, specifically concerning VAT and import duties, in due course. A policy paper on how the border with the European Union will work after the transition period is available at gov.uk/government/publications/the-border-operating-model.
If you are planning to recruit from overseas from 1 January 2021, you will need to register as a licensed visa sponsor
You may not be able to legally hire people from outside the UK if you do not have a licence. New employees from outside the UK will also need to meet new job, salary and language requirements. Irish citizens and those eligible under the EU Settlement Scheme are not affected.
Use gov.uk to identify changes affecting manufactured goods, such as new marking requirements or approval needed, to ensure your business is ready to sell them in the UK and EU
You may not be able to sell your goods in the UK and the EU from 1 January 2021 unless you act.
If you are moving goods into, out of, or through Northern Ireland, check the latest guidance
Whether you’re an existing client or don’t yet use our services, we would be pleased to help you. Contact Mouktaris & Co Chartered Accountants for expert advice or click here to subscribe to our Newsletter.
Coronavirus: Latest version of the Furlough Scheme
On 5 November, the Chancellor announced that the CJRS would be extended until the end of March 2021 for all parts of the UK. Employers want to know the details announced yesterday, as employees hope this will be enough to secure their jobs.
HMRC has circulated a short round-up explaining the impacts of this and where to find more information. The new and updated collection of advice notes can all be accessed from a single page: gov.uk/government/collections/coronavirus-job-retention-scheme.
What’s happening
CJRS has been extended to 31 March for all parts of the UK. From 1 November, the UK Government will pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month. Employers will continue to pay for hours worked as normal. The Government will review the policy in January.
Who is eligible
Employers and their employees do not need to have used the scheme before to claim for periods from 1 November. Employers can claim for employees who were employed on 30 October 2020, as long as a PAYE RTI submission was made to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.
Reference pay
All employees on an RTI submission on or before 19 March 2020 will be able to use the CJRS calculations as applied in August 2020 for reference pay and usual hours. For new employers claiming and new employees hired between 20 March 2020 and 30 October 2020, the average of tax year 2020 to 2021 up to the start of the furlough provides the basis for calculation (for fixed pay employees its the last pay period prior to 30 October 2020).
Legal matter
Employers should discuss with their staff and make any changes to the employment contract by agreement. To be eligible for the grant, employers must have confirmed to their employee in writing that they have been furloughed. Our clients can contact our office and we will provide you with a template agreement.
Compliance and monitoring
HMRC intend to publish details of employers who use the scheme for claim periods from December, and employees will be able to find out if their employer has claimed for them under the scheme.
Further updates
- As a consequence, the Job Support Scheme will start on 1 April 2021 at the earliest
- It also means that the £1,000 Job Retention Bonus will now not be paid in February 2021. The government said they will redeploy a retention incentive at the appropriate time.
- The Self-Employment Income Support Scheme (SEISS) grant for November-January will cover 80% of average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total. This is an increase from 55% and £5,160 respectively, previously announced.
- As of 2 November, application deadlines have been extended until 31 January 2021 for the:
- Bounce Back Loan Scheme
- Coronavirus Business Interruption Loan Scheme
- Coronavirus Large Business Interruption Loan Scheme
- Future Fund
- Covid Corporate Financing Facility
The extended generosity by the government comes at a cost. How precisely all of the various coronavirus schemes will be financed is highly uncertain.
Whether you’re an existing client or don’t yet use our services, we would be pleased to help you. Contact Mouktaris & Co Chartered Accountants for expert advice or click here to subscribe to our Newsletter.
Coronavirus: additional schemes and updates
Chancellor Rishi Sunak has vowed to “go further” as he announced the government’s latest Plan for Jobs: three new measures to help workers and businesses get through lower demand over the winter due to a coronavirus second spike. The most significant announcements concern the Job Support Scheme (JSS), which will be made up of two parts: JSS Open and JSS Closed. Both will start on 1 November, the day after the Coronavirus Job Retention Scheme (CJRS) finishes, and run for six months.
JSS Open
JSS Open will provide support to businesses that are open where employees are working shorter hours due to reduced demand.
- Employees will need to work at least 20% of their usual hours and employers will continue to pay employees for the hours they work.
- For the hours not worked:
- The UK government will pay a contribution of 61.67% of the usual pay, up to a maximum of £1,541.75 per month.
- Employers will pay 5% of the usual pay, up to a maximum of £125 per month, and can top this up further if they choose.
- Employees should receive at least two thirds of their usual pay for hours not worked, where they earn £3,125 a month or less.
- Employers will need to cover all employer National Insurance and pension contributions.
When JSS was originally announced, the government’s and the employer contribution to wage costs was to be one third each of the hours not worked.
JSS Closed
JSS Closed will provide support to businesses whose premises are legally required to close as a direct result of coronavirus restrictions set by one of the four governments of the UK. This includes premises restricted to delivery or collection-only services from their premises, and those restricted to providing food and/or drinks outdoors.
For JSS Closed, the UK government will fund two thirds of employees’ usual wages for time not worked, up to a maximum of £2,083.33 per month. Employers will not be required to contribute, but they can top up the government’s contribution if they choose to. Employers will still need to cover all employer National Insurance and pension contributions.
Self-employment Income Support Scheme (SEISS) Grant Expansion
It was previously announced that SEISS would cover 20% of monthly profits for the period from November 2020 to January 2021, capped at £1,875 in total. The UK government is now doubling the value of the first grant to 40% of three months’ average trading profits, paid out in a single instalment, and capped at £3,750. HMRC will provide full details about claiming and applications in mid-November. The second grant will cover a three-month period from the start of February until the end of April. The government will review the level of the second grant and set this in due course.
Grants for businesses in Tier 2 and Tier 3 Areas
Businesses in England in Very High alert level areas (Tier 3) will now be able to claim grants, regardless of whether they are legally required to close or remain open. The grant will be:
- £1,300 per month for businesses occupying a property with a rateable value of less than £15,000
- £2,000 per month for businesses occupying a property with a rateable value of less than £51,000 or occupying a property or part of a property with annual rent or mortgage payments of less than £51,000
- £3,000 per month for businesses occupying larger properties
Hospitality, hotel, B&B and leisure businesses in England in High alert level areas (Tier 2) will now also be able to claim grants. The grant will be:
- £934 per month for businesses occupying a property with a rateable value of less than £15,000
- £1,400 per month for businesses occupying a property with a rateable value of less than £51,000
- £2,100 per month for businesses occupying a property with a rateable value of greater than £51,000
Businesses in other sectors may also be eligible at the local authority’s discretion and we urge our clients to maintain communication with their local authority where possible, as discretionary grants are often made available at short-notice.
Businesses in any area which has been under enhanced restrictions can backdate their grants to August.
Whether you’re an existing client or don’t yet use our services, we would be pleased to help you. Contact Mouktaris & Co Chartered Accountants for expert advice or click here to subscribe to our Newsletter.
Winter Economy Plan
Chancellor Rishi Sunak today delivered a statement setting out plans to help workers and businesses hit by new coronavirus restrictions. With plans for an Autumn 2020 Budget cancelled, the Chancellor announced his Winter Economy Plan. In it he outlined how the various government support schemes to help businesses through the coronavirus restrictions will be extended or remodeled.
Job Support Scheme
As now anticipated, the introduction of the new Job Support Scheme (JSS) will come into effect on 1 November after the Coronavirus Job Retention Scheme (CJRS) ends. Under JSS, which will last for six months, employees who work at least 33% of their hours will be paid for two thirds of the hours they do not work, shared equally between the employer and the government.
The result is that an employee working 33% of their normal hours will receive 77% of their pay: 55% paid by the employer and 22% paid by government.
Other measures
- The self-employed grant is extended on similar terms to the JSS. A grant will be available to those eligible for the Self Employment Income Support Scheme (SEISS) and will cover 20% of monthly profits for the period from November 2020 to January 2021. A further grant to cover February 2021 to April 2021 may become available, depending on circumstances. [22/10/2020 UPDATE]: In his third economic statement within the last month, the Chancellor confirmed more generous terms for the remaining SEISS grants. The level of the third grant will be based on 40% of average trading profits, rather than the previously announced 20%, and will be capped at £3,750. The level of the fourth grant is to be kept under review and announced in due course. [Subsequent UPDATE]: The Chancellor confirmed once again even more generous terms for the remaining SEISS grants. The level of the third grant will be based on 80% of average trading profits, rather than the previously announced 20% then 40%, and will be capped at £7,500.
- Businesses that deferred a quarterly VAT payment during the lockdown previously had to pay this back by 31 March 2021 – now they will be able to spread this over 11 months during 2021/22. Businesses will need to opt in, but all are eligible.
- Individuals who deferred their July 2020 self-assessment tax liabilities till January 2021 will now not need to pay that till January 2022. Taxpayers with up to £30,000 of Self-Assessment liabilities due, including liabilities that will become due in January 2021, will be able to use HMRC’s self-service Time to Pay facility to secure a plan to pay over an additional 12 months. Any Self-Assessment taxpayer not able to pay their tax bill on time, including those who cannot use the online service, can continue to use HMRC’s Time to Pay Self-Assessment helpline to agree a payment plan.
- The VAT reduction to 5% for the hospitality sector will be extended from 12 January 2021 to 31 March 2021.
- The extension of Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back Loan Scheme (BBLS) loans from six to ten years.
- BBLS loans will become known as “Pay as You Grow” – businesses will enjoy a flexible repayment system which will include interest-only periods of up to six months and payment holidays.
- Applications for new loans under BBLS, CBILS, the Coronavirus Large Business Interruption Loan Scheme and the Future Fund remain open till the end of November 2020.
Whether you’re an existing client or don’t yet use our services, we would be pleased to help you. Contact Mouktaris & Co Chartered Accountants for expert advice.
Summer Statement 2020: summary
Four months after using his Spring Budget speech to announce the government’s first round of economic stimulants for supporting households and businesses through coronavirus, the chancellor yesterday cemented his status as the government’s Santa Claus, lavishing more gifts to Christmas 2020 and beyond.
It was branded as ‘A Plan for Jobs’ with a focus on supporting, creating and protecting UK employment. Here are some of the key measures announced by the Chancellor, and their implications for taxpayers.
STAMP DUTY
- A temporary increase in the Nil Rate Band of Residential stamp duty land tax (SDLT) in England and Northern Ireland, from £125,000 to £500,000. This will apply from 8 July 2020 until 31 March 2021 and cut the tax due for everyone who would have paid SDLT.
- Saves £15,000 on a transaction valued at £500,000.
- House buyers will only face a bill for stamp duty if they are spending more than £500,000 on a main property
“JOB RETENTION BONUS” TO ENCOURAGE FIRMS TO RETAIN FURLOUGHED STAFF
- A one-off £1000 payment to employers for every furloughed employee retained to the end of January 2021
- Applies to workers earning over the Lower Earnings Limit of £520 per month on average between the end of CJRS and the end of January 2021
SIX-MONTH VAT CUT FOR RESTAURANTS, HOTELS AND ATTRACTIONS
- A cut in VAT from 20% to 5% for the hospitality and tourism sectors from 15 July 2020 until 12 January 2021
- Food and non-alcoholic drinks in restaurants, pubs and cafes, as well as hot takeaway food will be covered
- Accommodation in hotels and B&Bs and admission to attractions such as theme parks and cinemas also affected
APPRENTICES, TRAINEES AND WORK PLACEMENTS
- A new grant of £2,000 will be made available to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over, from 1 August 2020 to 31 January 2021.
- Employers who provide trainees with work experience will be awarded a further £1,000 per trainee.
- Under the new “Kickstart Scheme”, £2bn has been allocated to fund 6-month work placements for people aged 16-24 and deemed at risk of long-term unemployment. Funding will cover 100% of National Minimum Wage for 25 hours per week plus associated National Insurance Contributions and automatic pension enrolment contributions.
EAT OUT TO HELP OUT
- Scheme offers 50% discount for every restaurant diner, up to £10 a head, from Monday to Wednesday throughout August
- Covers food and non-alcoholic drinks only
- Applies at participating restaurants, pubs, cafes etc
- Restaurant owners can claim the discount in full from the government via an online form to be circulated
GREEN HOMES GRANT
- From September, homeowners will be able to apply for vouchers worth up to £5,000 per household for projects to make homes more energy efficient in England
- Will match owners or landlords’ spend, £2 for £1 for most homes
- Up to £10,000 per household fully funded for low-income households
We are doing everything we can to help our business community. If you would like to discuss how the changes or the coronavirus pandemic may affect you or your business, please do not hesitate to contact us on 020 8952 7717 or use our online enquiry form.