Coronavirus UPDATE - NOVEMBER 2020
Prime Minister, Boris Johnson announced on Saturday 31st October 2020, that England would enter its second national lockdown due to the Coronavirus Pandemic, from Thursday 5th November 2020.
The second lockdown will apply to all non-essential businesses across England, which includes, gyms, restaurants, beauty salons, leisure and entertainment venues and non-essential retail stores. Schools, colleges and universities will be allowed to remain open, as will essential industries such as the construction sector. From midnight Thursday 5th November 2020, the UK will enter its second lockdown, which is to last for an initial four weeks, hoping to lift on 2nd December 2020.
This second lockdown is a devastating blow to many businesses who are already struggling to trade. However, the government has announced new levels of funding for businesses. Here's what we have so far:
Coronavirus help for businesses
In March 2020 the government announced a Coronavirus Job Retention Scheme (CJRS) otherwise know as the Furlough Scheme. This was due to expire at the end of October 2020, but the government has now extended this to the end of April 2021.
In September the government reduced the percentage of funding from 80% to 70%, and down to 60% in October.
From the new lockdown measures being introduced on Thursday 5th November 2020, furloughed workers will now receive at least 80% of their salary up to a maximum of £2,500 per month. For more information on whether your business can claim for the Coronavirus Job Retention Scheme head to the Gov website here https://www.gov.uk/government/collections/coronavirus-job-retention-scheme
The guidance includes information as to:
Claims can be made for employees on the payroll on 31st October 2020.
Is the £2,500 inclusive of employers pensions and employer’s NIC? – No
Will the grants cover employers pension contributions. – Not any more
Will the grants cover employer’s NIC? – Not any more
Does it include directors? – Yes it does
The Self-Employment Income Support Scheme Grant Extension provides critical support to the self-employed in the form of two grants, each available for three month periods covering November 2020 to January 2021 and February 2021 to April 2021
VAT – deferrals will apply from 20th March to 30th June. There is no need to apply. However, if you pay by direct debit this should be cancelled before any returns filed.
PAYE – speak to HMRC if you are having difficulties paying on 0300 200 3200 or 0800 0159 559 for the Time to Pay scheme.
Income Tax – You are eligible if you are due to pay your second self-assessment payment on account on 31 July. You do not need to be self-employed to be eligible for the deferment. The deferment is optional. If you are still able to pay your second payment on account on 31 July you should do so. You do not need to apply.
Support for businesses that pay little or no business rates
The Local Restrictions Support Grant (LRSG) supports businesses that were open as usual, providing services in person to customers from their business premises, but which were then required to close for at least 3 weeks due to local lockdown restrictions imposed by government.
It is for businesses that pay business rates on their premises. Local councils may at their discretion also provide funding for businesses that don’t pay business rates.
Further details can be found on the .Gov website here.
Support for businesses paying tax: Time to Pay service
All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
These arrangements are agreed on a case-by-case basis so the key thing here is to speak to HMRC and come to an agreement.
If you have any questions regarding any of the above please get in touch with us, as we can offer you help with your Furlough Payroll via our Payroll Services.