The Government has extended the three coronavirus business interruption loan schemes - the Coronavirus Business Interruption Loan Scheme (CBILS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Bounce Back Loan Scheme (BBLS).

As the schemes were announced at different times, they previously had different closing dates, with each scheme originally open for applications for a period of 6 months. The extension aligns the end date for applications for the schemes to 30 November 2020.
 
Ashgates has assisted several clients with successful applications so far and can assist you in this process. If you require advice or assistance, please contact us.
 
Extension of Repayment Terms
 
The Government also announced an extension to the repayment terms for BBLS and CBILS.
 

• BBLS repayments will be converted into “Pay as You Grow”, allowing businesses to extend the length of their BBLS loans from six to ten years.
• CBILS lenders will be given the ability to extend the length of loans from a maximum of six years to ten years “if it will help the business repay the loan”.

 
We expect more details to be released on the extension of repayment terms including how existing terms can be extended and are monitoring further Government announcements and will update accordingly.
 
We are here to help so please contact us if you wish to discuss any of the above.

The Government has extended the temporary reduced rate of VAT (5%) to tourist attractions and goods and services supplied by the hospitality sector. This relief came into effect on 15 July 2020 and was due to end on 31 January 2021 but will now be extended to 31‌‌ March 2021 across the UK.
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We are here to help so please contact us if you wish to discuss any of the above.

If you deferred paying your July 2020 payment on account, you will need to pay the deferred amount in addition to any 2019/20 balancing payment and first 2020/21 payment on account by 3‌1‌‌ ‌‌January 2021. This may be a larger payment than you usually pay in January.

If you're unable to pay this liability in full by 31‌‌ January 2021 then you can set up a Time to Pay payment plan of up to 12 months online.  If your self-assessment tax debts are up to £30,000 then you'll able to access this Time to Pay facility through the gov.uk website and approval will be automatic and immediate.

If your self-assessment debts are over £30,000 or you need longer than 12 months to repay your debt in full then you will still be able to apply for a Time to Pay arrangement by calling HMRC.  It is likely that you will have to provide evidence of the reason you can not pay and produce cash flow forecasts. 
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We are here to help so please contact us if you wish to discuss any of the above.

Businesses who deferred their VAT payments that were due between 20 March and 30 June 2020 were due to make these payments in full to HMRC by 31‌‌ March 2021. Under the VAT Deferral New Payment Scheme, businesses can now opt to spread the deferred payments in equal instalments up to 31‌‌ March 2022. 

Businesses can make payments as normal by 31‌‌ March 2021 or make Time to Pay arrangements with HMRC if you need more tailored support.  Current VAT payments remain due on the normal due date. 
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We are here to help so please contact us if you wish to discuss any of the above.

Two previous grants have been available to self-employed individuals whose business has been adversely affected by Covid-19.  The SEISS has now been extended for self-employed individuals who are actively continuing to trade but are facing reduced demand due to Covid-19.

To be eligible for the grant extension self-employed individuals, including members of partnerships, must:

• currently be eligible for the SEISS (although they do not have to have claimed the previous grants).  Eligibility can be seen here.
• declare that they are currently actively trading and intend to continue to trade
• declare that they are impacted by reduced demand due to coronavirus in the qualifying period (the qualifying period for the grant extension is between 1 November and the date of claim)

The extension will provide two further grants to self-employed individuals who qualify with the grants being paid in two instalments each covering a three-month period.

The first grant will cover November until the end of January with HMRC providing the taxable grant covering 20 per cent of average monthly trading profits.  The grant will be paid out in a single instalment covering 3 months’ worth of profits and capped at £1,875 in total.

The second grant will cover February until the end of April with the exact details of the value of the grant being set in due course.
The grants are subject to Income Tax and National Insurance Contributions.

It is expected that the claims process will be the same as the previous grants with claims being made through the individuals’ digital tax accounts.  Confirmation of this and the timing for making a claim will follow in due course.

We are here to help so please contact us if you wish to discuss any of the above.

As announced last week the new Job Support Scheme will be introduced from ‌‌1‌‌ November 2020 to help to protect jobs where businesses are facing lower demand over the winter months due to coronavirus.  The scheme will run for six months to April 2021 and will see the Government contribute towards the wages of employees who are working fewer than normal hours due to decreased demand. 

Employers will continue to fund the wages for the hours worked by employees. For the hours the employee does not work, the employer and the government will each pay one third of their usual wages (capped at £697.92 per month). Examples can be found on the Government’s Job Support Factsheet.

Employers will need to meet their share of the pay for unworked hours together with all the National Insurance and statutory pension contributions

The eligibility criteria for employers is as follows:

• Employer must have a UK bank account and UK PAYE schemes in place before 23 September 2020.
• Large businesses will have to meet a financial assessment test with the scheme will only being available to those whose turnover is lower now than before experiencing difficulties from Covid-19. There will be no financial assessment test for small and medium enterprises (SMEs).
• HMRC will expect large employers using the Job Support Scheme not to be making capital distributions, such as dividend payments or share buybacks, whilst accessing the grant.

Further details of the financial assessment test and criteria regarding the capital distributions will be released with future guidance releases.

Eligible employees must:  

• be registered for PAYE on the payroll on or before 23 September 2020 with an RTI submission notifying payment for that employee must have been made to HMRC on or before 23 September 2020.
• work at least 33% of their usual hours. The minimum hours threshold will be in place for the first three months of the scheme and the Government have confirmed that they will review whether to increase this for the final three months of the scheme.

The Job Support Scheme will commence on 1‌‌ November and you will be able to claim for November in early December. Grants will be paid on a monthly basis.

The existing Coronavirus Job Retention Scheme is completely separate to this new scheme and neither the employer or the employee needs to have previously used the Coronavirus Job Retention Scheme.  Further, the Job Support Scheme will operate in addition to the Job Retention Bonus and employers and employees can benefit from both schemes in order to help protect viable jobs. 

For further information please see the Government’s fact sheet.

We are here to help so please contact us if you wish to discuss any of the above.

Further to our previous messages regarding furloughed staff we thought we should remind you that the level of the CJRS grant reduces from 1 October 2020. The Government’s contribution to wages will reduce to 60% of wages up to a cap of £1,875.00 for the hours a furloughed employee is on furlough.

Employees remain entitled to receive 80% of their normal wages while on furlough with the balance of 20% after the CJRS claim now being funded by the employer. Employers will also continue to pay the national insurance and pension contributions for hours not worked as well as all costs for any hours worked under the Flexible Furlough Scheme.

These changes should be factored into any decisions regarding the use of flexible furlough and decisions to bring employees back to work, as well as implications for holiday entitlement and timing of any redundancy decisions.

​The CJRS will close at 31 October 2020 and be replaced by the Job Support Scheme.

We are here to help so please contact us if you wish to discuss any of the above.

The Chancellor has today announced new measures to support businesses through the ongoing Covid-19 pandemic.  The headlines of his announcements are:
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• The Coronavirus Job Retention Scheme will end on 31 October 2020 as planned.
• A Job Support Scheme will be introduced for six months commencing on 1 November 2020.  To be eligible employees must work a minimum of 33% of their normal hours with one third of their unworked hours being paid by the employer and one third of the unworked hours paid by the Government.  An employee who works the minimum hours will receive at least 77% of their pay.
  • An employee on £1,000 per month who works the minimum 33% of their hours will be paid £330 for the hours worked, £223 by the employer and £223 by the Government totalling £776 of pay
  • An employee on £1,000 per month who works half their hours will be paid £500 for the hours worked, £166 from the employer and £166 from the Government totalling pay of £832 of pay
• The Self Employed Income Support Scheme is being extended on “similar terms” to the existing job support scheme.
• Businesses who deferred their VAT will no longer have to pay a lump sum at the end of March 2021.  They will now have the option to spread the deferred amount into 11 interest free monthly instalments.
• Time to pay arrangements for income tax debts up to £30,000 can be agreed over 12 months to January 2022
• The planned increase in VAT in January 2021 from 5% to 20% for the hospitality and tourism industry has been deferred to 31 March 2021. 
• The repayment of Government backed loans can be extended from six years to ten years.  Interest only repayments can be paid for up to six months in extreme circumstances.
• A new loan scheme for businesses will be announced in January. 

We are monitoring further Government announcements and will update accordingly once these have been released.
As always, we are here to help so please contact us if you wish to discuss any of the above.

The Government have announced new grants will be available for businesses in England that are required to close due to local lockdown measures.

Payments are triggered by a national decision to close businesses in a high incidence area. Each payment will be made for a three week lockdown period and each new three week lockdown period triggers an additional payment.

The grants are available for each property that is closed at the following rates:

• For businesses with property with a rateable value of £51,000 and over (or occupies a property or part of a property subject to an annual rent or mortgage payment of exactly £51,000 or above) they will receive £1,500 for every three weeks that the business is closed
• For businesses with property with a rateable value below £51,000 (or occupies a property or part of a property subject to an annual rent or mortgage payment of less than £51,000) they will receive £1,000 for every three weeks that the business is closed

Other key points:

• If a business is not on the business rates list, it may still be eligible to claim through a discretionary fund and you should contact your local authority
• Local authorities will be responsible for distributing the grants to businesses in circumstances where they are closed due to local interventions
• Any businesses that are still closed at a national level such nightclubs will not be eligible
• The grants will be treated as taxable income.

 
Further information from the Government regarding this scheme can be found at:
https://www.gov.uk/government/news/ministers-announce-new-grants-for-businesses-affected-by-local-lockdowns

HMRC have published the updated rates for mileage claims on company cars that take effect from 1 September 2020.

You can use the previous rates for up to one month from the date the new rates apply.  The advisory fuel rates per mile for journeys undertaken on or after 1 September 2020 are: