Further guidance was issued yesterday and today on the scheme.

We have today been provided with full details of how claims will be made, starting from next Monday, 20 April.  We confirm that the information that will be required for claims is the same as that which has been set out in our previous guidance (see previous bulletins), and we are encouraging all qualifying employers to pull this together by Monday. It is also vital that claimants are registered for “PAYE Online for employers” on the Government Gateway – it is not sufficient for you or your agent to be submitting payroll information online.   You must ensure that you are registered as a business on that particular section of the Gateway because that will  provide access to the claims portal. HMRC have confirmed that the information will have to be input for each employee, apart from employers with 100 or more furloughed staff who will be able to supply the information using software such as Excel. HMRC are saying that payments will be made to the nominated bank account within 6 working days of making the claims, so if you manage to make a successful claim on Monday, you should receive the grant money by Monday 27th April.

The headline change to the scheme that was announced yesterday,  was to amend the date on which an employer is required to have had a payroll scheme in operation.  This has been extended from 28 February to 19 March 2020, which was the day on which Mr Sunak introduced the scheme. That date is now also the date on which an employee must have been on the payroll – again, this is a move from 28 February.

These changes appear to be aimed at assisting those people who were between jobs on 28 February but had started their new job by 19 March – this was a category of worker that fell through a “gap” in the system. However the rules are not completely straightforward as they only relate to employees to whom a payment had been made and been notified to HMRC under the online PAYE system (called RTI). This seems to rule out monthly paid employees who would normally have expected to receive their first salary payment at the end of March (i.e. after 19 March), and only covers people on weekly payrolls who would have been paid for either or both of the weeks ended 13 March. It is easy to see the logic in this as HMRC will have evidence that these weekly paid employees were on the payroll before the scheme was announced, whereas it would be possible for an unscrupulous employer to alter a monthly paid person’s recorded start date to before 20 March, having paid them on 31 March and made an RTI return for that date.    This is a clear example of the Chancellor’s stated aim of ensuring that the financial support systems are as secure as possible from fraudulent manipulation, and it will still leave people stranded who might otherwise have been rescued by this change.

There are other minor changes to the JRS, involving clarification of some potentially grey areas concerning the reason for furloughing staff and the nature of the documentation required to support claims.

Business Interruption Loans

The lack of progress on the issuing of loans under the CBIL scheme has been hitting the headlines, having been highlighted by the Opposition.  The statistics are fairly dismal, both in terms of the proportion of successful applications and the amount that has been advanced. Plenty of suggestions are being made to improve the take up, but I think it is very unlikely that the government will agree to increase their guarantee to cover 100% of the loans, as put forward by the Labour Party. There has been some encouragement through the entry to the market of some more innovative lenders who are (allegedly) not so tied down by historic lending criteria as the well-established banks, so applicants who are having a frustrating time with their usual banker may find some help in that direction. However,  as we have stressed many times in the past, any application must be supported by a well thought through business plan and forecasts demonstrating a requirement for funds by a viable business with a feasible plan for repayment.

Small Business Grant and Retail, Hospitality and Leisure Sector Grant

The grants continue to be rolled out by the local authorities, and Brighton and Hove City Council is highlighting the requirement to use their new portal to raise queries or provide information which they have requested. Be sure to do this as the councils have been provided with the funds to make these grants (to reiterate, they are non-repayable grants, not loans) and they are keen to allocate them to eligible businesses.

Import Duty and Vat Deferment Scheme

If your business imports goods and makes use of the Duty and Vat deferment scheme, it is now possible to apply for the deferment of payment by telephoning the Duty Deferment office on 03000 594243. This initiative relates initially only to the April payment which was due yesterday, so it may be too late for that to be deferred, but if it has not yet been paid this option should be pursued. Hopefully this will be applied to the May payment and future months as well.

Author: Peter Hedgethorne, Director 

(16 April 2020)