Guidance during COVID-19
Issue 4 - 25 March 2020
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In light of the Government's announcements, we are expecting clarity on some of the processes and procedures that are to be followed and will update all resources to reflect the updates as soon as we can.
COMPANIES TO RECEIVE
3- MONTH EXTENSION PERIOD TO FILE ACCOUNTS DURING COVID-19
Businesses will be given an additional three months to file accounts with Companies House to help companies avoid penalties as they deal with the impact of COVID-19.
From today (25 March 2020) and announced by Gov.uk, businesses will be able to apply for a 3-month extension for filing their accounts.
This joint initiative between the government and Companies House will mean businesses can prioritise managing the impact of Coronavirus.
As part of the agreed measures, while companies will still have to apply for the 3-month extension to be granted, those citing issues around COVID-19 will be automatically and immediately granted an extension. Applications can be made through a fast-tracked online system which will take just 15 minutes to complete.
Firstly, speak to your accountant in the first instance regarding this to ensure they support and guide you throughout the application process and advise where appriopiate
Companies should simply citeCOVID-19 or Health matters as the grounds for their application
full guidance on applying for an extension- gov.uk/ch/extend-accounts-deadline
companies that have already extended their filing deadline, or shortened their accounting reference period may be ineligible for an extension
this policy will be kept under review and amended as necessary in light of the progress of the COVID-19 pandemic
DEFERRED INCOME TAX SELF-ASSESSMENT PAYMENT
For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.
If you are self-employed you are eligible.
How to access the scheme
This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.
Customers who normally pay by direct debit should cancel their direct debit with their bank if they are unable to pay. Please do so in sufficient time so that HMRC do not attempt to automatically collect on receipt of your VAT return.
HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities.
Speak to your accountant for more information
Retain key workers
The Coronavirus Job Retention Scheme (CJRS) enables employers to access grants, by the end of April at the latest, from the UK’s tax authority to allow them to keep paying staff. The government says 80% of gross wages in the private sector, up to £2,500 a month, for those not working and who would otherwise have been laid off, will be covered by these grants from HMRC. SMEs will need to designate affected employees as ‘furloughed workers,’ and notify their employees of this change. We would advise you to speak to your HR department on this.
SSP for current workers
The scheme will shortly be available to allow SMEs to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to the coronavirus. This refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of the virus. It has been advised that employers should maintain records of staff absences and payments of SSP, but employees don’t need to provide a GP fit note. The Government has yet to provide anymore clarification, but mentions that it will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible.
RECAP ON SUPPORT
CBILS Government backed loans
The British Business Bank’s Coronavirus Business Interruption Loan Scheme (CBILS) facilitates business loans to smaller businesses that are viable but unable to obtain finance due to having insufficient security to meet the lender’s normal requirements because of the Covid-19 crises. In this situation, CBILS provides the lender with a government-backed 80% guarantee against the outstanding facility balance.
The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments. Please note eligible which requires the SME tobe UK-based in its business activity, with annual turnover of no more than £45m. In addition, the SME will need to provide a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable the business to trade out of any short-to-medium term difficulty.
Please remember that the borrower always remains 100% liable for the debt. Any loan of over £250k will need to be secured by company assets.
We would advise for you to initially speak to Financial Planner, Lak Singh, RA Wealth Limited regarding your application and to guide you through the process, please email: firstname.lastname@example.org | www.rawealth.co.uk
Business rates ‘holiday’
There will be a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. SMEs do not need to take any action to qualify for this. It will apply to their next council tax bill in April 2020. However, your local authority may have to reissue companies’ bills automatically to exclude the business rate charge.
Grant funding of up to £25,000
Retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000 will qualify for the Retail and Hospitality Grant Scheme. This provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.
For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000. For businesses in these sectors with a rateable value of between £15,000 and £51,000, they will receive a grant of £25,000. Local authorities will write to all SMEs eligible for this grant shortly.
Defer VAT and Income Tax payments
An automatic VAT deferral will apply from 20 March 2020 until 30 June 2020. No applications are required for the deferral and businesses will not need to make a VAT payment during this period. And, for the self-employed, Income Tax Self-Assessment payments due on the 31 July 2020 will be deferred until the 31 January 2021.
Please see the following link for Key Websites to Support Businesses:
We are now providing FREE advice and guidance calls to our clients and any business owners in the UK - Call us on 020 3301 7474 or email email@example.com to arrange a call with one of our Partners.
Please remain safe and take care.
- RA Accountants LLP