Two months ago today, the country was heading on the road to recovery, and we made a specific decision to send our last Covid support email.
At the time, we realised all our clients' businesses were in very different places; some largely unaffected, others on the brink of closure, and each would need our help in a different, and tailored way.
A round-robin email like this was no longer the best way forward (even if the marketing gurus tell you it is!). And, to be frank, it's very time consuming when writing our own content. Sending you a link to HMRC would be much quicker but, generally, useless 🤦♂️
What's the Craic Now?
This email is really just to update you on the high-level changes which take effect from tomorrow (subject to ratification in parliament today). As before, please accept this as generic advice and get in touch with me if you'd like our help with any of the financial support available.
The advice here applies to businesses in England. Wales, Scotland and NI have slightly different rules as the new lockdown is only in England. And there does seem to be a bit of a political p*ssing match going on between Westminster and Scotland right now.
The Furlough Scheme
Clients who have used the furlough scheme will have had a message from me late last week about how the scheme ends in October and is replaced by the Job Support Scheme.
It took a long time to collated and summarise all the relevant information. But 24 hours later, the government ensured that was all a waste of my time (!) as they announced a new lockdown, which extended the furlough scheme by another month. The main points to consider, as they stand today:
- The Furlough scheme will run until the end of November (strictly, 2nd December) and potentially further if lockdown is extended.
- The flexible aspect will continue, so staff can work reduced hours and you can claim for the difference.
- Employers can claim 80% (rather than 60%) of unworked wages paid to staff who were on the payroll on 30th October.
- Pensions & NIC to be paid by Employers as before
- The actual claim portal won't open until later in November - not a problem for monthly payrolls, could be an issue if you pay weekly.
- Importantly (in case you were thinking of being cheeky) you need to be able to show that your business has still been negatively impacted by Covid. This ain't a free-for-all!
- The £1,000 Furlough Bonus is still planned for January but I expect this to be pushed back if lockdown is extended
- And, finally, all the other furlough rules from last month still apply.
The Job Support Scheme (JSS)
This was due to start in November, but has been deferred to the end of lockdown 2; currently December, but who knows???
The scheme will be open to ALL employers where they have viable jobs that are on reduced hours. The key features:
- You DO NOT have to have used the furlough scheme to claim this.
- Staff MUST work at least 20% of their usual hours. No work = no claim.
- Evidence will be required of hours worked, e.g. timesheets (we are told HMRC are going to be VERY hot on fraudulent claims)
- HMRC will top up 61.67% of their "unworked" hours, with the employer paying just 5%, plus NIC and Pensions
Our original memo to clients (pre-lockdown) with more details can be seen here: https://docs.google.com/document/d/1rOMOSXGp5oxPDQQEy-S-QMsfjeWNCkNy-zNBIfNfejo/edit
If you roll forward the dates by a month, everything else remains the same at the moment.
Self-Employed Income Support Scheme
We knew this was being extended, but with Lockdown 2, the grants have become a little more 'generous', for want of a better word.
In short, there will be TWO claim periods:
- Nov-Jan 2021, a grant of 55% of average trading profits for the period (capped at £5,160).
- Feb-April 2021, another grant based on trading profits - % to be determined.
- The claim portal will open at the start of December and, as before (don't ask!!) taxpayers cannot ask their accountant to claim on their behalf, they must do it personally via the Government Gateway.
- There's no clarity yet on whether 2019/20 taxable profits will be taken into account, now we're further down the line, or if as before it will be the average of 18/19, 17/18 and 16/17. So if you haven't already filed your 2019/20 tax return I would recommend doing this ASAP, especially if the profits are higher than 2016/17 [sic].
Business Rates Grants
For businesses with premises who are legally required to close, there will be a grant of between £1,334 and £3,000 per month to help with rent and utilities.
That 'per month' is critical - for example, if lockdown ends on 2nd December but your business is still not allowed to re-open (e.g. subject to a local lockdown), these grants will continue for the foreseeable future.
Remember, there's also lots of other support out there which I won't reiterate here, around deferring taxes, mortgage payments and so on. We can discuss these on the phone if you like - everyone's position will be different.
As you know, we don't take on new clients after 31st October, with the exception of those we've already been in discussions with. This means that by pure coincidence, I will now have less demands on my time and will be able to talk you through the support you might be able to get.
I DO NOT plan on sending further round-robin Covid updates unless it gets worse (to paraphrase the Black Knight from the Holy Grail...🏆) or there's something really critical.
These take a long time to write and review - sometimes everything goes in the bin because the gov't change the goalposts before I press send! - and I know my time is best spent working one to one with businesses on making sure they access all the funding that's available to their unique circumstance.
So, I'm relying on you now! If you'd like our help going forward, please take the steps to book a Covid support call to talk about your business. Otherwise I'll sit back and relax in the warm fuzzy glow of knowing you've got everything under control.
There's no charge for a call itself. Book a call here.