Accounting and Taxation advice in Hexham, Northumberland

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Thoughts for the week ending 15th May

Well it’s been an interesting week.  I’ve actually had some time at home trying to redress the balance of the ridiculous hours that this virus has imposed on my working schedule. So, on Monday I watched a number of select committees in live session which was interesting, particularly given the circumstances, but not something I’m going to make a habit of!


We’ve had lots of guidance this week - not all of it consistent which isn’t surprising given the nuance with which the government is trying to move the country forward. Listening to all the Prime Minister’s speeches, the words that I’ve heard most often are “common sense”. It is after all common sense to be able to live life in a less restrictive way than we have while not getting closer than 2 metres to a non-family member and so hopefully not increasing the societal infection rate for COVID-19. So let’s hope that “common sense“ prevails and we do have schools open in June and pubs open in July. Inevitably there will be an awful lot of people with their fingers and toes crossed that this works.


The only really significant additional freedom I think we’ve been given, in that businesses that were not required to close have been able to continue to operate - providing they’ve been able to do so safely, is that we can now drive as far as we like to take exercise – that is providing you can get home that night and providing you don’t go to Wales or Scotland! A clear message isn’t easy is it?


Now onto a few technical updates:

Self-employment Income Support Scheme (SEISS)
The first claims for SEISS started on Wednesday 13th May, with 110,000 claims reportedly made in the first 4 hours. The first grant payments are expected six working days after the claim is made.  The process appears to be quick and straight forward for most people.  The claim process takes about 5 minutes and requires no input of numbers as HMRC have already done the calculations to work out what you are entitled to.  You are simply confirming that you meet the eligibility criteria, and a calculation is presented to show the amount of the claim.  We have contacted relevant clients individually to tell them if they may be eligible and how to apply for the grant.


One of the criteria for being eligible for the grant is that your business has to be adversely affected by the Coronavirus pandemic.  Although HMRC have listed some examples of how a business may be adversely affected, they have intentionally not mentioned any specific or measurable reductions in income.  There is no link between the amount of the grant and the financial loss incurred.  Therefore a business that has been affected in a small way will receive the grant on the same basis as a business who has been greatly affected.


If you are unable to apply online the you should call the SEISS helpline of 0800 024 1222.  There is also a review process if you believe HMRC have classed you as ineligible in error, which you can access through the eligibility checker once it has given you an answer of ineligible.
 
Coronavirus Job retention scheme (CJRS)
The government announced earlier this week that it will extend the CJRS until the end of September, however from August the Government will ask companies to “start sharing” the cost of the scheme.   Further details of the changes from August are yet to be released.  Until the end of July the government will pay 80% of the employees wage up to £2,500 a month.  From August the scheme may potentially reduce the 80% or the employer will have to top-up the salary too, it is also possible that it will be used to top-up the salary of employees brought back into work on reduced hours.
In the meantime, claims are continuing for the 7.5 million people currently on furlough.  There have been a couple of updates to the claims process:

  • HMRC added a 'save and return' option to the online furlough claim service. This means that you can now return to a partially completed claim, rather than having to do it all in one go.
  • You are still unable to amend a claim.  Previously the accounting profession have been advising people to amend their next claim, in order to correct errors in a previous claim – therefore the two claims together are correct.  However HMRC now say that they are working on a process so that you can correct a claim, and are advising people to NOT amend the next claim as this may delay payment.

 
Statutory sick pay
There are a few updates to the government’s guidance on Statutory sick pay (SSP) including how it applies to employees who are “shielding” for 12 weeks on or after 16 April 2020 as they have been instructed to do so.  It also includes updates on linked periods of incapacity, and those self-isolating before and after 13 March 2020.  The full guidance on SSP is on the link below:
https://www.gov.uk/guidance/statutory-sick-pay-manually-calculate-your-employees-payments


 Free childcare
The government has relaxed the eligibility criteria for tax free childcare and the 30 hours free childcare as a result of the Coronavirus.  You may need to apply, or reconfirm if you already have a childcare account if you are on furlough, reduced hours, statutory sick, are self-employed or a critical worker.  More information is on the link below:
https://www.gov.uk/guidance/check-if-you-can-get-tax-free-childcare-and-30-hours-free-childcare-during-coronavirus-covid-19


Selling or buying a house
You may also find this helpful, or perhaps a little barmy!  The government’s advice on selling or buying a house during the pandemic:
https://www.gov.uk/guidance/government-advice-on-home-moving-during-the-coronavirus-covid-19-outbreak


Have a good weekend
Keep well, Tricia

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