The situation in relation to coronavirus is rapidly evolving and things are changing every day. We find ourselves asking the same questions as many of you, at this time all we can do is share with you what we know when we know it.
“We have seen a significant increase to calls and emails to the office around all this uncertainty, without this crisis it is already a busy time of year with tax year-end. Therefore we ask if you would kindly review the below information to take the strain off our staff resources to ensure we can continue to meet your payroll deadlines”.
Useful Resources
ACAS Guidance for Employers & Employees
CIPP News & Coronavirus Payroll Updates
Universal Credit and Claiming Benefits
It has been confirmed that payroll professionals are “Key Workers” that fulfil a crucial role during this crisis, ensuring Britain continues to get paid. Therefore it is business as usual for us so we can support your business and workers. If you are having financial difficulty, we urge you to look through the information below and to regularly check the government support for employers to see what financial support you can access! Also, talk to us, do not pull the shutters down and simply disappear, we are in this together and only together with good communication will we find our way through this. #KeepUKPaid
Here’s a link to our contingency plan page.
Coronavirus Job Retention Scheme (CJRS)
Announced on the 31st October 2020, CJRS has been extended to support businesses through another lockdown period expected to last until 2nd December.
Key facts: –
- Coronavirus Job Retention Scheme (CJRS) has been extended for at least another month
- Job Support Scheme (JSS) has been postponed until CJRS ends
- All employers with UK bank account and UK PAYE scheme can claim the CJRS grant
- To be eligible to claim for an employee under this extension, employees must be on an employer’s PAYE RTI submission before 23:59 on the 30th October 2020.
- Employees can be on any type of contract. Employers will be able to agree any working arrangements with employees.
- Employers can claim the grant for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. Such calculations will broadly follow the same methodology as currently under the CJRS.
- When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
- Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
- For worked hours, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NICs due on those amounts.
- As under the current CJRS, flexible furloughing will be allowed in addition to full-time furloughing.
- The government will pay 80% of the wages up to a maximum of £2500. The grant must be paid to the employee in full.
- Employers will continue to pay the employers NIC and statutory pension contributions and must pay the employees for hours worked in the normal way.
- Employers can choose to top up the employees pay at their own expense.
The government will confirm shortly when a claim can first be made in respect of employee wage costs during November. But there is no gap between the end of the last scheme and the start of this extension.
You can read HMRC’s full news story in the link below: –
Job Support Scheme (JSS)
JSS Open and JSS Closed are schemes that have now been postponed in favour of an extention to the Coronavirus Job Rentention Scheme (CJRS) announced on 31st October 2020.
Click here for more information.
Job Retention Bonus (JRB)
The bonus – announced by Chancellor Rishi Sunak as part of his Plan for Jobs last month – will see businesses receive a one-off payment of £1,000 for every previously furloughed employee if they are still employed at the end of January next year.
Click here for more information.
The Government are also urging employers to check their carefully before submission and to also check previous claims to avoid any future penalities fro claiming too much.
If you have claimed too much CJRS grant and have not repaid it, you myst notify HMRC and repay the money by the latest of whichever date applies below:
- 90 days from receiving the CJRS money you’re not entitled to
- 90 days from the point circumstances changed so that you were no langer entitled to keep the CJRS grant
- 20 October 2020, if on or before 22 July you received CJRS money you were not entitled to, or if your circumstaces changed.
If you do not do this, you may have to pay interest and a penalty as well as repaying the excess CJRS grant.
SSP – Statutory Sick Pay
It was announced that SSP (Statutory Sick Pay) will be payable from day 1 where an employee is advised to self-isolate whether they display symptoms or not. Employers with less than 250 employees as at 28 February 2020 will be able to reclaim 2 weeks’ SSP paid to an employee. This became effective from the 13th March 2020.
If an employee does not qualify for SSP, then they may be able to claim Universal Credit.
Employers should maintain records of staff absences and payments of SSP but employees will not need to provide a GP fit note; employees can now obtain an isolation note HERE.
The Impact Of Changes On Payroll
Some payroll software will not allow SSP to be paid from day one; a manual payment/override will have to suffice until software updates are released.
Further guidance and how to claim
Off-Payroll Working Reforms (IR35)
The government has announced this week that the IR35 Off-Payroll Working Reforms due to apply from the 6th April 2020 will now be postponed until 6th April 2021.
This is part of additional support for businesses and individuals to deal with the economic impacts of COVID-19. This means that the different rules that exist for inside and outside the public sector will continue to apply until 6 April 2021.
Time To Pay Scheme for Tax Payers
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 and are tailored to individual circumstances and liabilities.
Eligibility
You are eligible if your business:
- pays tax to the UK government
- has outstanding tax liabilities
How to access the scheme
If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.
If you’re worried about a future payment, please call us nearer the time.
Working From Home – Expenses
If you have employees now working from home due to COVID-19, find out what equipment, services or supplies are taxable and how to report these to HMRC, review the guidance HERE.
Other Support For Businesses
Support for businesses that pay business rates
The government will introduce a business rates retail holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.
A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.
Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday will be published by 20 March 2020.
Business rates holiday for retail, hospitality and leisure businesses
The Government will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.
Eligibility
You are eligible for the business rates holiday if:
- your business is based in England
- your business is in the retail, hospitality and/or leisure sector
Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:
- as shops, restaurants, cafes, drinking establishments, cinemas and live music venues
- for assembly and leisure
- as hotels, guest & boarding premises and self-catering accommodation
How to access the scheme
There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.
You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.
Further guidance for local authorities is available in the expanded retail discount guidance.
Cash grants for retail, hospitality and leisure businesses
The Retail and Hospitality Grant Scheme 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 £15,001 and £51,000, they will receive a grant of £25,000.
Eligibility
You are eligible for the grant if:
- your business is based in England
- your business is in the retail, hospitality and/or leisure sector
Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:
- as shops, restaurants, cafes, drinking establishments, cinemas and live music venues
- for assembly and leisure
- as hotels, guest and boarding premises and self-catering accommodation
How to access the scheme
You do not need to do anything. Your local authority will write to you if you are eligible for this grant.
Guidance for local authorities on the scheme will be provided shortly.
Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.
Support for businesses that pay little or no business rates
The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.
Eligibility
You are eligible if:
- your business is based in England
- you are a small business and already receive SBBR and/or RRR
- you are a business that occupies a property
How to access the scheme
You do not need to do anything. Your local authority will write to you if you are eligible for this grant.
Guidance for local authorities on the scheme will be provided shortly.
Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.
Deferring VAT and Income Tax Payments
We will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.
VAT
For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.
Eligibility
All UK businesses are eligible.
How to access the scheme
This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.
Income Tax
For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.
Eligibility
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.
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.
Coronavirus Business Interruption Loan Scheme
A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to support primarily small and medium-sized businesses to access bank lending and overdrafts.
The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value.
Businesses can access the first 12 months of that finance interest-free, as the government will cover the first 12 months of interest payments.
Eligibility
You are eligible for the scheme if:
- your business is UK based, with turnover of no more than £45 million per year
- your business meets the other British Business Bank eligibility criteria
How to access the scheme
The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks will offer the Scheme once it has launched. There are 40 accredited providers in all.
You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.
The scheme will be available from early next week commencing 23 March.
Insurance
Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim.
Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.