Coronavirus Support Update – 6 June 2020

Below you will find updates on the key Coronavirus Support Schemes, including the Job Retention Scheme (or Furlough Scheme), Top-Up Grants, Self-Employed Income Support Scheme, Statutory Sick Pay, Government-back Loan Schemes and VAT Deferral. Additionally, there is more news on the Reverse Charge in the Construction Sector, which was announced yesterday.

In case of interest, here are some recently published blogs, which might be of interest to you:

• HMRC and Bitcoin: All You Need To Know;
• What Legal Documents Do I Need For My Business?;
• What is next? U, V, or L shaped UK recession?;
• Dying Without a Will – The Rules of Intestacy; and
• 4 Tips To Successful SME Cash Flow Management.

We will continue to keep you updated as more information about the existing support packages, or any new packages become available here and across our blogs and social media channels (Facebook, Instagram, LinkedIn and Twitter).

Please be reassured, especially at this time, that we are here to help you and we want to help you in any way we can. Whilst we are all remote working, it is very much business as usual. Our thoughts are with you and yours.

Job Retention Scheme (CJRS)

More than 25% of workers or 8.7m are now furloughed, costing the government £14bn-a-month. Last week we outlined the key changes with Flexible Furlough and the phasing out of the support scheme ending in October.

Remember, the scheme will close to new entrants from 30 June. What that means is from this point onwards, employers will only be able to furlough employees that they have furloughed for a full three-week period prior to 30 ‌ June. The 10 June will therefore be the final date by which an employer can furlough an employee for the first time, in order for a three-week furlough period to be completed by 30 June.

Please be careful not to commit fraud here. Nearly 2,000 cases have already been reported to HMRC through their whistle-blower helpline.

Top-Up Grant

Whilst many have benefited from a taxable grant of £10,000 for businesses who received small business rate relief or rural rate relief, or £25,000 for those in the retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000, many have been left behind. And the Government’s answer to this is the Top-Up or Discretionary Fund. This might be for you if you:

• Have a rateable value of £15,000 or more and are not in the Retail, Hospitality or Leisure sector;
• Use shared spaces;
• Are a regular market trader;
• Small charity; or
• Bed and Breakfast (who pays council tax).

The Government released more detail of their plans to Local Authorities two weeks ago, so many are now live or going live this week. If this could be you, please ensure you get in contact with your local authorities ASAP as there is a very small window to apply (one or two weeks).

Self-Employed Income Support Scheme (SEISS)

Remember that this scheme has been extended with a second and final grant available in August, with a taxable grant worth 70% of your average monthly trading profits for three months, paid out in a single installment capped at £6,570. The eligibility criteria are otherwise the same as before. You don’t have to claim the first grant to claim the second. We are expecting more information on this by the end of next week, so watch this space and we will keep you posted.

Claims for the first SEISS grant, which opened on 13 ‌May, must be made no later than 13 July, so if you are eligible, please make sure you claim. Over 2.5m have claimed the grant so far, costing the government over £7.2bn.

Statutory Sick Pay (SSP)

The Coronavirus Statutory Sick Pay Rebate Scheme went live last week. Under this, eligible employers can claim repayment up to two weeks of Statutory Sick Pay, starting form the first qualifying day of sickness, if an employee is unable to work because they:

• Have coronavirus symptoms;
• Are self-isolating because someone they live with has symptoms;
• Are self-isolating because they’ve been notified by the NHS or public health bodies that they’ve come into contact with someone with coronavirus; and/or
• are shielding and have a letter from the NHS or a GP telling them to stay at home for at least 12 weeks.

You can claim from the first qualifying day your employee is off work, if the period of sickness started on or after:

• 13 March 2020 – if your employee had coronavirus or the symptoms or is self-isolating because someone they live with has symptoms;
• 16 April 2020 – if your employee was shielding because of coronavirus; or
• 28 May 2020 – if your employee has been notified by the NHS or public health bodies that they’ve come into contact with someone with coronavirus.

You must have paid the employee’s sick pay before you can claim it back. An online application by us (if we are your agents) or whoever does your PAYE can then be made, although there are other ways to claim if you are unable to do this online yourself (or we would be happy to help you of course).

Government-backed Loan Schemes

There are now three government-backed loan schemes and the lending through each scheme is as follows:

Despite being the latest scheme to be launched, the CBBLS has made the biggest impact and whilst some teething issues still exist, the scheme is definitely the most successful to date. Whilst it is a loan and needs to be repaid, the terms are very attractive and this could be a key way for many businesses surviving. There are now 20 approved lenders for CBBLS with more being added each week and some are accepting applications from non-clients. It is still normally quickest and easiest to approach your existing bank however. Only take it out if you think you will be able to pay it back. One recent survey estimated that 43% of borrowers will never pay the loan back.

VAT Deferral

Under the existing Coronavirus Support Schemes, you can defer payment of any VAT due between 20 March and 30 June. If your VAT is due on 7 June and you want to take advantage of this, make sure you cancel your Direct Debit, if this is how you pay, before putting it back in place before your next quarter payment is due.

Reverse Charge Changes in Construction Sector *Delayed Again*

After much lobbying, HMRC have delayed the overhaul of VAT in the construction industry back to 1 March 2021, due to the impact of the coronavirus pandemic.

HMRC were initially introducing the domestic reverse charge, effective from 1 October 2019. This would have changed the way VAT was charged for certain construction services and would have required a change of approach by those supplying and receiving certain goods subject to VAT. Those on flat-rate schemes would most likely find it best to transition to full rate scheme as part of this change.

The purpose of the change was to address the millions lost each year because of missing trader fraud. This is when businesses in the construction industry charge VAT to customers, but this doesn’t get declared to HMRC. It would also have meant that HMRC would have had less businesses to potentially investigate and manage. In case of interest, here is our previous blog which details this change further. We will be writing a further blog on this topic shortly.

Big Shave *Video is here…*

Scam Warning

We are seeing record numbers of scams and phishing emails as fraudsters attempt to get your personal details at this difficult time. Please be even more vigilant than normal, especially at this time. More information about spotting and reporting scams and phishing can be found here.

Black and White Accounting

This is a difficult time for everyone and we must come together to get through this. Our thoughts are with you, your family and your friends especially at this time.

If there is anything we can do to help you at this difficult time, please do get in touch by contacting Black and White Chartered Certified Accountants, populate the “Got a Question” form on the right, or call us on 0800 140 4644.