Hi In just a few days we've gone from "how can my business operate with reduced turnover?" to full-blown closures and exactly £0 income forecast for many clients. Following all the measures from last week, the accounting community is desperately waiting for more clarification on how reliefs and grants will work in practice, so we can share this with you. So the main remit of this email is to flesh out some of the guidance as things have developed since the weekend. As ever, call us if you want to talk about any of the information below. ***There has been much chatter in the last 24 hours about more help for the self-employed. Nothing has been confirmed as yet, and now is not the time for speculation. Of course, we'll let you know once things are announced and we have some tangible information to give you*** In the meantime, self-employed people should approach the Universal Credits helpline (via gov.uk) to see what support is available there. HR Support We're getting lots of people asking for HR and Employment law advice, in respect of layoffs and reduced working hours. Chartered Accountants can't give out legal advice, and for those without access to it, we want to make sure help is still available. Our friends at Croner Taxwise provide HR support and have an Employment Law helpline which is already available to all clients who currently have Tax Investigation Insurance with us; it's included in the price. We'd like to make this available to all clients. When and How do I get this? Until the end of April, we have decided to upgrade our policy with Croner to cover EVERY client of Blue Penguin. This means that all clients will be able to phone and speak to an expert about any employment issues you might have. Click Here for the contact details. They will ask for your policy number - please request this from me before calling. I would appreciate this not being shared with anyone else. Please note our policy only applies to the advice line - Tax Investigation Insurance is only available to those who pay for it - let me know if you'd like more info). Eviction of Commercial Tenants If your business has been forced to close and you're paying rent on empty premises, you may consider terminating the lease, especially if it's a rolling lease or you have a break clause coming up. Or simply just not paying it altogether where it's a choice between rent or wages(!). To that end, yesterday the govt proposed a measure which means no business can be evicted until 30th June for missing a rent payment. You'll remember from Saturday's briefing that there are grants of up to £25,000 available to businesses with commercial premises (i.e. not just a home office). I expect the grant to be related to the rates bill for the 2020/21 tax year, which starts on the 6th April. There is a risk that businesses who don't occupy a property on 6th April may not get the grant. This is all conjecture, as hard facts are sorely lacking, but I want to highlight this in case it backfires on those who decide to vacate premises this week. When and How do I get this? No action required - this simply means you cannot be evicted in the next three months for not paying the rent on a commercial (i.e. not residential) lease. Whilst I cannot, of course, advise you to breach any rental agreement you have, this measure may give you some small comfort that if you need time to pay the rent - perhaps waiting until your grant is received - before deciding to vacate any property, this measure may help. I wouldn't judge you if you waited for the grant and then vacated... If you are in discussions with your landlord about rent payments, make them acutely aware that you need to receive your £10K/£25K grant (if applicable) before you'll be able to pay their rent. That may help them see sense! Furlough Update Information has been sorely scarce on this most valuable relief, with the govt offering to reimburse 80% of the workers' wages. Here's what the guidance tells us today: - Furloughed workers must not do ANY work whilst on leave. Hence it won't be possible for sole directors to claim furlough payments unless the company is truly dormant and NO work is undertaken. - This will apply to workers on February's payroll - new starters can be furloughed but govt won't reimburse their wages. - You must agree mutually with the worker to furlough them, and agree how much they will be paid - this doesn't need to be their usual salary, especially is this is above the govt cap of £2,500. - Payments are made as normal through the payroll to the employee, along with PAYE/NIC deductions and pension contributions as required. - HMRC will reimburse the employer in due course - likely to be May at the earliest. This is a cash hit to your business in the first instance, with no certainty on when you will be able to claim funds back. - Currently only available for 3 months, but could be extended. It would be strongly advised to have written agreement of the furlough from the employee. Here's a letter template you are free to use, however, we provide this with no warranty whatsoever; we're not lawyers. Sorry. Here's what the guidance is silent (or contradictory) on: - Whether the reclaim is 80% of total pay including bonus/overtime, or 80% of base salary. - Ditto, whether this is based on February alone or an average over the last X months. - How the National Minimum Wage comes into this - if no work is performed, the hourly rate can't be below NMW. The legislation may require a payment of at least the NMW for their "usual" hours. - Whether the govt will also reimburse Employer's NIC and Employer's pension contribution costs. Before you ask... I'm pleased to say nobody has asked me yet, but, we're all in this together and if you're going to ask us to: - Re-run February's payroll to increase the salaries or add any new starters, or - Apply for the furlough grant for employees who are still working and not been laid off then I'm afraid it's a 'no' from me and we'd respectfully ask you to find another accountant. I hope you understand. VAT De-registration Last week, we suggested if you are expecting your sales to fall below £85K in the next 12 months, you might benefit from de-registering for VAT. That advice remains for those whose businesses still function at a reduced rate. But, following the closure of most businesses across the UK yesterday(!), if your sales are going to be close to ZERO for the foreseeable future, you may be better off staying registered and reclaiming VAT on your essential business purchases over the next few months, to get some extra cash into the business. Please give me a call if you want to discuss some specific figures for your business before deciding whether to deregister. Finally, A Reminder: Please click here to see the archive of previous CV19 emails, in case you've just joined us. Remember WE NEED YOUR HELP - we want to hear real-world experiences of the reliefs available and access to new finance, so we can build a map of how things are rolling out across the UK, and whether the measures are manifesting themselves as promised. We don't care if you're a client or not - we're genuinely all in this together - and information will be shared anonymously with everyone in this group. If you'd like to book a call FREE OF CHARGE to discuss any of the above, or how your business has been affected in general, we've set up a dedicated appointment you can book here: https://calendly.com/blue-penguin/coronasupport In the meantime, stay safe, stay tuned and for goodness' sake stay indoors if at all possible. Peter and the Blue Penguin team. 💙Smallprint: this is a massively fluid situation. The above is our understanding right now, but things are changing daily. Please don't take any of this as legal advice, yada yada. We'll do our best to keep you up to date with more information as we get it. Please call us for clarification on any points above. | 
