During these uncertain times we wanted to reach out to all our clients to let you know that we are here to offer you support and guidance over the next few months.
Health and wellbeing are absolutely paramount and so we are adapting the way we work with you and so if you have any questions please don’t hesitate to contact you. We will continue to complete your bookkeeping, accounts, VAT, payroll and tax returns in a timely manner.
If you and your staffare working remotely and / or struggling to keep your records straight, then please let us know. We can install a variety of Cloud based solutions to help and if you can scan and email documents to us, we can assist in completing the necessary book entries to help ensure that your financial records are up to date.
Your main purpose is to protect the health of yourself, employees and customers and then reduce the risk of the financial impact to your business – you need to take action now.
This starts with keeping up to date with the Government’s action via https://www.gov.uk/government/topical-events/coronavirus-covid-19-uk-government-response. Whilst these are unprecedented and trying times please do not rush into making decisions based around the headlines from the Government’s announcements. At present whilst they are conveying good messages of support understandably the substance has yet to be decided upon/finished and that is the crucial part of the message.
So far, we have
– Job retention scheme, in which government grants will cover 80% of the salary of PAYE employees who would otherwise have lost their jobs, up to £2500 a month. It will cover any employer and if necessary backdated to 1 March 2020. However, there are questions yet to be answered, can an employee go in and out of being furloughed if the business needs change? When will these payments be made? How can employers apply? At present the systems are not in place to make these payments to employers.
– VAT payments deferral, the next VAT quarters payments are automatically being deferred until at least June 2020. However please note it is only a deferral and the liabilities will still need settling by the end of the 20/21 tax year.
– Income tax payments, those payments due under self-assessment will be deferred until January 2021. Again, this is automatic and there will be no penalties or interest charged.
– Universal credit can now be accessed by the self employed in full at a rate equivalent to statutory sick pay.
– HMRC time to pay scheme has a COVID 19 helpline for calls to arrange a payment plan, 0800159559.
– Business rates have a holiday for 20/21 tax year for retail, hospitality and leisure sectors, and businesses in those sectors with a rateable value of between £15k and £51k will get a cash grant of up to £25k per property. Any business claiming small business rates relief will also get a cash grant of up to £10k. This will be delivered by the local authorities and they will be in touch with the businesses it applies to directly.
– Coronavirus Business Interruption Loan Scheme loans should be available from 23 March, being up to £5million for businesses with a turnover of less than £45million. They will be administered by the normal banking sector and 80% will be underwritten by the Government, with the borrower being 100% liable for the loan. These loans have an interest free period of 12 months. You will need to be aware that the banks administering them will be looking to see if the business was viable before the crisis and will be again on the crises ending. This is not free money to be handed out and will be based around the business being a going concern.
– Mortgage holidays of up to 3 months have been agreed with the mortgage lenders. You will need to contact your lender direct, for both residential and buy to let mortgages. However, interest will still be charged and so the mortgage will cost more in the longer term. There is also no clarification as to whether such payment holidays will have an adverse impact on credit ratings.
– Statutory sick pay has been made applicable from day 1 rather than day 4, and for employees’ self-isolating for 14 days this can be fully reclaimed from HMRC.
This highlights a range of measures that are being put in place but before decisions are quickly made WAIT for the detail and in the meantime begin your action plan commencing with cashflow assessment for the next 3 months. Remember that deferrals mean the debt still exists and will still need to be paid, and therefore is an important post crisis consideration.
If you have any questions over this or need any help with assessing cashflow predictions, the viability of the business, employee related issues please get in contact with us, 01793 538198 or email@example.com, or ring your usual contact.
Talk to us – we are all in this together