APH Accountants COVID-19 Business Support Update 15.06.20
Matt here again, I hope everyone is well! You may notice a sprinkling of pauls humour in this newsletter as it was co authored! (Including the addition to my name at the end!)
When you have a spare 10 minutes, grab a cuppa and have a read. The information in this Newsletter is designed to keep you updated and informed so it is important that you read it.
The light at the end of the tunnel is beginning to shine a bit brighter for many of you now as we move into the next stages of lockdown easing. For some it will unfortunately still be a while yet before things begin to go back to normal, or even ‘the new normal’ as we keep hearing. But hopefully the recent announcements will have given some idea of when you will be getting out of that tunnel!
I managed to leave the house last week to do an activity that wasn’t ‘essential’ or ‘exercise’ and played Viking mini golf with the kids, which was great and definitely showed me that things are beginning to return to normal finally!
In other news, as you know both Katy and Carla have bought new bikes. Katy has now sent her bike back after realising that Barbie bikes are hard to ride on the roads and Carla kitted herself out to the extent that she looks like a member of the Tour De France Peloton now, even though she only rides to the end of her road and back.
Dave has been running himself into the ground with a 14 mile run last week, it was meant to be seven but he got lost and is now suffering from severe blisters, Kerry had a birthday with a procession of cars that looked like Whacky Races all beeping her a happy birthday, Lauri had a week’s holiday and took a trip to Costa Gardeno, Danielle has been attempting to not work in her PJ’s and dressing up in gym gear but not doing anything physical and Paul has been the pub for a bottle of beer (White Lion in West Kirby for those desperate to know where),
So, a busy week for all the staff! Anyway, back to business and the support measures the government have put in place are all still ongoing, and Paul’s update of 2 weeks ago summarised the most recent changes in all of these, or how they will change in the coming months, including:
- Flexible furloughing from July
- Employer contributions to furloughing from August
- 2nd Self-employed income support grant to be given in August.
So, whilst there hasn’t been much to add to the last update in the last 2 weeks, there are a few things we thought would be worth mentioning or reminding.
- Covid-19 Discretionary Business Grant
- CJRS – Furlough Scheme recap
- June Furlough Claims
- Tax payment support
- Bounce Back Loans
- Working from Home – Garden Office/Log Cabins
1. Covid-19 Discretionary Business Grant
Local councils have been given funding from central government to use for additional business grants for businesses. Paul has mentioned these before but just a recap,
- Any businesses who have fixed property costs but missed out on the small business grant or Retail, Leisure and hospitality grant can apply for a grant from this fund.
- There are no set conditions that mean you will or won’t receive a grant from this fund
- Acceptance of the grant application and the amount of the grant are entirely at the council’s discretion.
- There is likely to be a high demand for these grants and there is a limited budget.
- Wirral council opened applications for this grant at the start of June and applications will stop being accepted on Friday 19th June at 12 noon. So if you haven’t already applied do so this week!
More info can be found here for the Wirral council applications
If you are from another council area then search your local councils website for ‘discretionary business grant’ and you should be able to find info relevant to your councils application process.
2. CJRS – Furlough Scheme Extension (Flexible Furloughing)
Just to recap, the main points from the latest announcements are:
- The Scheme has been extended to the 31st October
- From the 1st July, employers will be able to bring in workers part-time and pay them for the time worked and furlough them for the time they don’t
- From 1st August employers will not be able to claim the Employers National Insurance and Pensions Element of their Furlough Claims and must therefore pay for this themselves
- From 1st September Employers to start paying 10% of the Furlough Claim – Therefore claim will be capped at £2,190 per employee per month
- From 1st October Employers to start paying 20% of the Furlough Claim – Therefore claim will be capped at £1,875 per employee per month
- If employers don’t contribute – neither will the government.
- The scheme will be closed to new entrants from the 30th June and will therefore only apply to existing employers who have furloughed staff. This means staff must have been furloughed on or before 10th June to have been furloughed for the required 3 week minimum before the scheme closes.
- At present there is no guidance on how the Employer will pay the 10% & 20% contributions – More guidance will be issued later
Further guidance on the scheme can be found here
3. June Furlough Claims
We will be processing June Furlough claims on Monday 22nd June so you will hopefully receive your claim money in time for the June payroll run.
IF THERE ARE ANY CHANGES TO YOUR CIRCUMSTANCES PLEASE INFORM US BEFORE THIS DATE OTHERWISE THE CLAIM WE MAKE ON YOUR BEHALF WILL BE INCORRECT. IF THERE IS NO CHANGE FROM LAST MONTH THEN YOU DO NOT NEED TO DO ANYTHING
As we are now beginning to reach a time were some businesses are reopening or thinking about reopening, and also when flexible furloughing begins next month, it is VITAL that for any of you we are claiming furlough payments for, that you let us know as soon as a member of staff is un-furloughed or on your plans for flexible furloughing.
As previously we continue, and will continue, to process furlough claims free of charge for as long as possible.
4. Tax Payment Support
It is now approaching the time when VAT payment support ends (30th June) which gave businesses the ability to defer VAT payments until the 31st March 2021.
After this date (30th June 2020) normal VAT liabilities will be due payment. If you still cannot afford to pay then contact HMRC’s Time to Pay, details can be found at the link below:
The second of the payments on account for self-assessment payments are due by the 31st July 2020. However the government have given you the ability to defer payments until 31st January 2021 if you need to. You do not need to tell HMRC that you’re deferring your payment on account. Of course you can still pay your second payment on account if you wish to. It is also probably worth remembering that in January 2021 your balancing payment of tax and 1st payment on account for the next year will also be due, so it is probably worth factoring this in when you think about deferring July’s payment. Of course you could make July’s payment somewhere in between July and January if that helps spread the cost a bit better.
IF YOU ARE HAVING ANY DIFFICULTIES WHATSOEVER IN PAYING ANY TAXES THAT ARE DUE OR WILL BECOME DUE THEN DON’T HESITATE TO CONTACT HMRC ON THE LINK BELOW – THEY ARE DOING ALL THEY CAN TO HELP
5. Bounce Back Loans
There are still a few people who don’t realise that they can claim for a bounce back loan, rather than repeat all the information on it – if you are unsure then just get is touch with us and we can guide you.
6. Working from Home – Log Cabins
Due to the change in working practices for a number of businesses, many are now re-considering if or how much office space they actually need now. I know it is something we are considering.
Our home working practices have been very successful so far and have not impacted on our ability to carrying on working as normal (even with the kids off school!) (unfortunately not everyone is in this position). In fact a number of staff have gone from dreading the proposition to now considering it as a “new normal” and balancing it with some time in the office and some time at home working. Even the office space we are re-considering, and instead of having 3 floors, reducing this to 1, or maybe using shared office spaces more (subject to social distancing et al)
Over the past 3 months of home working it has been our busiest period ever, not only in terms of carrying on with our normal work, but also providing free help, support and advice for everything related to the Coronavirus Government Support Packages, calculating and submitting Furlough claims free of charge and being there for clients every step of the way. Couple this with a record number of new client sign ups over the same period, this has meant that staff have improved their efficiency and productivity as well in the same period.
Therefore, going forward one can only assume there may be a fundamental shift for office workers in the way they work. Because of this we have had a couple of enquiries from clients about having a home garden office or Log cabin – so at least they have some degree of separation from the home if it’s difficult to create a dedicated working space in the home.
Personally, I would love a garden office or a log cabin! So, for those considering it here are a few key points from a tax perspective about the ability for your business to pay for it:
- It would be classed as a ‘structure’ for HMRC purposes. This is the case even if it is portable
- Therefore falls under the structures element of capital allowance tax relief maximum of 3% of the value per year being tax deductible
- But (Isn’t there always a but with HMRC!) this structure would be excluded from even this 3% rate as it falls under HMRCs list of exclusions of being a ‘structure located in the grounds of a residence’
So in a nutshell no point in your business buying and you trying to claim tax relief!
But but but… we found another way to consider!
- You are allowed to claim for any ongoing expenses of the cabin, ie light and heat, water if it has its own supply
- Also for any costs of installing any electrics
- You can also claim for the fittings and furniture and equipment inside the office
- And lastly, why not rent the Garden Office / Log Cabin to your business – After all you may pay rent to an existing landlord! Don’t forget though the rental income needs to go in your self-assessment, but you can claim a £1,000 allowance on this provided you have no other sources of rental income.
No doubt by now for a few of you the cogs are starting to whirl! Before you make any decision on this though please give us a call to talk through so we can advise you. Now where did I put my Log Cabin brochure?
Finally, we will as always try to keep you up to date with all the latest help and support for you and your business. If you need us for anything, please do not hesitate to contact us.
“Live as if you were to die tomorrow. Learn as if you were to live forever.” – Mahatma Gandhi
Matt (Mad Dog) Newman