Charterwells have declared war on Covid-19.
Charterwells are leading from the front for hundreds of small businesses to win the fight against Covid-19. We are all in this together and Charterwells have the ability to skillfully guide you through these harsh times so your business can prosper.
Below are a number of key measures to help you through this. As a client, rest assured you will be backed by a firm that can help you beat Covid-19.
Please email us at firstname.lastname@example.org and we will get you through this!
Bounce Back Loan Scheme (BBLS)
This scheme will allow banks to offer loans up to £50,000 to small businesses. These loans are 100% backed by the government. The first 12 months will be interest free and it is indicated that thereafter the rate will be 2.5% or lower. Charterwells are expecting lenders to process applications much quicker compared to CBILS. For applications that are approved, BBLS could be a real life saver for many small businesses.
Work from Home
Businesses and workplaces should encourage their employees to work from home, wherever possible. Look at employees health and safety whilst working from home. Good use of cloud solutions and the right hardware is a game changer. We can help you use this to your full advantage. For example your employees, can complete a HMRC form P87 online (www.gov.uk/tax-relief-for-employees) to claim tax relief for expenses such as desks, chairs and printer ink they buy to perform their work duties from home.
Customers and your Network
Also, ensure you keep in good contact with your customers, suppliers your bank and your network. Keep them in the picture and this will help you negotiate and plan ahead. This can help to agree payment plans, discounts and flexibility. Good communication will build trust and will set you up to prosper over the longer term.
Statutory Sick Pay
If your staff are sick due to Covid-19, new legislation enables them to get SSP from the first day they are off work. This will begin from 13th March and can get £94.25. Statutory annual leave will still accrue while the employee is off work sick. Click for further details
Furloughed Workers - Job Retention Scheme
If you can not cover staff costs due to Covid-19, you may qualify for the Coronavirus Job Retention Scheme. Employees should not undertake work whilst furloughed. Employers can claim up to 80% of the wage bill (up to a cap of £2,500 per month per employee) up to the end of July 2020. You can choose to top-up the salary of the furloughed employee but are under no obligation to do so.
This scheme will run until the end of October from 1st March 2020. From August the state support may taper down from 80%
This applies to UK employers that had created and started a PAYE payroll scheme by 28 February 2020 and must have a UK bank account. New employees hired after 28th February 2020 are excluded.
Claims will be made via an online portal, which should be set up before the end of April.
To make a claim you will need the following details:
Paye reference number - number of employees being furloughed - the claim period (start and end date) - amount claimed - bank account and sort code - your contact name and phone number
We strongly recommend using legal/HR advice for this process. HMRC will enforce strict rules and will clamp down on any abuse of the rules. Through our strong network we have on tap a number of great legal and HR advisory firms that can help you.
On 26th March 2020 the Chancellor announced a grant of 80% of average monthly profits over the last 3 years up to £2,500 per month for an initial 3 months. It is called the Self Employment Income Support Scheme (SEISS)
The maximum grant available is £7,500.
HMRC will use the average profits from tax returns in 2016-17, 2017-18 and 2018-19 to calculate the size of the grant.
This is only available to people who have the majority of their income from self-employment and who have profits below £50,000.
The scheme will be open for and initial three months with the first grant being paid in June 2020. HMRC will contact qualifying individuals directly and will arrange payments into the recipient's bank with one installment.
In the mean time, if you are a key worker and allowed to work, you can still continue to work as long as you are obeying the Covid-19 rules (e.g. social distancing) .
Also, you can claim the Universal Credit if you meet the eligibility criteria. Click for further details
Limited Company Contractors & PSC's
The measures announced for self employed individuals do not apply to contractors, personal service companies or business owners who take their remuneration through dividends. For this group this can be a significant gap. We are keeping a close eye on this as further announcements by the government, may be made to help.
A 12-month business rates holiday for all retail, hospitality and leisure businesses in England. Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief.
The Coronavirus Business Interruption Loan Scheme (CBILS) offering loans of up to £5m for SME's through the British Business Bank. Click for further details
The actual VAT returns are still to be processed and submitted as normal. But HMRC will allow businesses to defer VAT payments that are normally payable between 20th March 2020 up to 30th June 2020. They will be payable on 31st March 2021.
It is vital that you cancel your Direct Debit with HMRC or they will automatically take the VAT liability.
The VAT liabilities will still be payable but at a later date. The deferral is automatic and no applications are required. VAT refunds and reclaims will be paid by HMRC as normal.
Tip: Even if you have the cash to pay, keep hold of it and put it in a separate deposit account (to provide you with a buffer against any future impact of Covid-19)
The 31st July 2020 payment on accounts will be deferred until 31st January 2021. Again this is automatic and no applications are required. No penalties or interest for late payment will be charged in the deferral period.
Time to Pay Offer
HMRC will be more flexible and will allow you more time to pay tax if you are experiencing financial distress as a result of Covid-19. A dedicated helpline has been setup by HMRC to help you. Call 0800 0159 559.
Cash is King
Charterwells can prepare a cash flow projection for you and help you steer through this. If the last trading year was good, then provide Charterwells with all the data to ensure that your accounts are up to date. This will help you access funding, negotiate with supplier and meet covenants.
If you have made losses, we may be able to offset these against other income or past profits.
Tip: For your personal finance, remember that you can benefit from a 3 month payment holiday on your mortgage. This can help you reduce the amount you take out from the business!
Contact Charterwells and we can rapidly get you up to speed with this and more, to enable us to focus and grow in the year ahead.