There have been no major initiatives announced in the last couple of weeks, but there have been developments with the existing Coronavirus Financial Support Packages.

Job Retention Scheme (“JRS”) – Furlough Grants

A lot of businesses will be starting to think about their second claims covering the month of May, and HMRC have offered advice on how these should be processed in the event that it turns out that some calculations were made incorrectly last time – a situation that will not be unusual given the novelty and complication of the rules. They say that they understand that these things will happen, but have asked that if they do come to light, the next claim should not be adjusted to compensate. Apparently HMRC are working on a process whereby past claims can be corrected, and they do not want people to compound their errors by altering the next claim. This is because that might cause them to query the accuracy of the correcting claim if it does not agree to what they are expecting, with the result that the payment of the claim may be delayed.

In his well-publicised announcement on the JRS provisions on 12 May, Mr Sunak extended the period for furlough claims to the end of October. The scheme will remain in its current form until the end of July (extended from the end of June), and a revised scheme will be available for the three following months to 31 October. The details of the new scheme have been promised by the end of May, and the Government have indicated that they will be expecting employers to contribute towards the salaries of furloughed staff, and that the rule that these people are not allowed to work for their employers is to be relaxed to allow part time working.

Self Employed Income Support Scheme (“SEISS”)

The grant application process went live last week and many eligible self-employed people have received their grants already. If you think that you may be eligible but have not yet made a claim, you should go to the web page ( https://www.tax.service.gov.uk/self-employment-support/enter-unique-taxpayer-reference ) where you can check whether HMRC consider that you qualify. If so, you will be guided through the process of making the claim which is very straightforward and should result in the grant being paid into your nominated bank account within 6 working days.

HMRC have tried hard to make the claims as easy for claimants as possible, and for the majority of people it works very well. However it is inevitable that those whose tax affairs have been slightly out of the ordinary may not be fully served by it. It is therefore essential that you satisfy yourself that the figure that HMRC say is due to you is accurate, possibly by referring to your agent if you have one. HMRC have said that if you do not agree with their figure, you should still claim it as part of the automatic process, but then contact them with your query which they will deal with in due course. The same applies if you think that you should have a grant but HMRC are saying that they do not consider that you are eligible – you should contact HMRC to query this, although it may be worth seeking advice initially in case you are misinterpreting the complex rules.

Bounce Back Loans (“BBLs”)

This loan scheme has been very successful and many businesses have been able to access the 100% Government backed loans from their banks. If you have been adversely affected by the pandemic crisis, and can fill in a simple questionnaire to demonstrate that your business was viable at 31 December 2019, then you should qualify to receive a loan of up to £50,000, with a maximum of 25% of your turnover, which has no application fees and no interest or repayments due for 12 months. After that period, the loan will carry interest at 2.5% and will be repayable by regular instalments within 6 years of the advance, with no penalties for early repayment.

Discretionary Fund for Small Business

This additional source of funds is for small business sectors who do not qualify for the other small business grants which have been available for some time. The original grants are generally available to those who are on the business rates register, and have been successfully distributed by local authorities. The new grants are targeted at other businesses which cannot benefit from the original ones, and details of the rules laid down by the Government are at https://www.plusaccounting.co.uk/knowledge/blog/covid-19-financial-support-update/ . Whilst the Government have indicated which businesses they think should mostly benefit from these grants, they have left it up to the individual local authorities to make the final decisions on who should receive the grants based on the unique requirements of businesses in their area. This will involve careful assessment of claims from potential recipients, and the process for these claims is being developed locally. Brighton and Hove City Council are due to consider their approach to the scheme next week with a view to publicising the process for making claims via their  online portal early next month. They have approximately £3.5m available to distribute and are proposing to use their discretion to give some priority to the events, arts, cultural, creative and retail sectors (in addition to those specified by the Government) in recognition of the importance of those sectors to the economy of the City.

Statutory Sick Pay (“SSP”) Refunds

One of the first initiatives to be announced back in March was the ability of businesses to claim a refund of SSP paid to Covid-19 affected employees for the first two weeks of their absence. Normally the payment of SSP is a cost to business and cannot be reclaimed. HMRC announced last week that it will be possible to make these claims, based on the records of SSP payments, from next Tuesday, 26 May. Details of how the claims can be made is at https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19 and involves signing into your PAYE Online Government Gateway, entering the new service and providing the information set out in the guidance at the above link. You should note that the refunds cannot be claimed by businesses with more than 250 employees and will be made for SSP payments relating to periods of sickness starting on or after 13 March (for those who had coronavirus or the symptoms or was self-isolating because someone they live with had symptoms), and on or after 16 April (for employees who were shielding because of coronavirus).

Author: Peter Hedgethorne, Director, Plus Accounting

Any views or opinions represented in this blog are personal, belong solely to the blog owner and do not represent those of Plus Accounting. All content provided on this blog is for informational purposes only. The owner of this blog makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site.

Date Published: 22 May 2020