5th November 2020
This article was last updated on 5 November at 13:20.
This is haysmacintyre’s dedicated summary page for individuals and partnerships on the range of financial, tax and accounting measures being introduced to support finances in the light of the current COVID-19 pandemic.
Navigating through the personal finance environment has never been more difficult. This page summarises the support available to all individuals and partnerships, including for employees and the self-employed.
Please visit this page regularly as new content will be produced that considers the latest updates and new initiatives.
As we are acutely aware that this is a challenging we are running a series of virtual events to provide much needed support and guidance to our clients and contacts. The virtual events are tailored to different sectors and cover a variety of topics ranging from the Government’s schemes and grants to furloughing staff and financial reporting. To view our upcoming virtual events, please click here.
If you wish to discuss any of the COVID-19 related initiatives or changes please contact your usual haysmacintyre contact or email CV19@haysmacintyre.com.
Support for employees
Coronavirus Job Retention Scheme (CJRS) and Job Support Scheme (JSS)
The Government introduced the Coronavirus Job Retention Scheme (CJRS) to provide financial support to allow businesses (including partnerships and LLPs) to continue to pay salaries to those employees that would have otherwise been laid off or made redundant as a result of COVID-19. Following the announcement of a second lockdown in England for the period 5 November to 2 December, the CJRS did not close on 31 October 2020, as previously planned. It will instead continue until March 2021. More information on the latest update of the CJRS can be found here.
The introduction of the Job Support Scheme has therefore been delayed.
Extension to the Statutory Sick Pay (SSP) regime for SMEs
Temporary changes are being made to SSP regulations as part of the Government’s response to helping businesses during this period of disruption. Further details are here. HMRC’s online SSP calculator is available for employers to work out statutory sick pay for employees. See here.
Support for the Self-Employed
Self-Employment Income Support Scheme
The second Self-Employment Income Support Scheme (SEISS) grant, which closed for applications on 19 October, was announced as the final assistance grant for the self-employed.
In the Winter Economy Plan, delivered on 24 September 2020, the Chancellor announced that a third SEISS grant will be available to cover 20% of average monthly profits for three months, for those who were eligible for the first and second SEISS grants. This was to be capped at £1,875 per taxpayer. On 22 October, the Chancellor announced further changes to the scheme, increasing the amount of profits covered by the third and fourth self-employed grants from 20% to 40%, meaning the maximum grant will increase from £1,875 to £3,750. We await details of the opening date and process for applications. Following the announcement of the second lockdown in England from 5 November, the Government has announced that the SEISS grant will increase to 80% for November 2020 to January 2021 and that the claims window will open towards the end of November, rather than in December as previously planned. There are no changes to the eligibility criteria.
A fourth SIESS grant will be made available for the three months to cover February to April 2021.
Business interruption loans
For SMEs: the British Business Bank (BBB) together with 40+ lending providers are providing a range of financial options enabling a SME (turnover of less than £45m) to borrow up to £5m, with the first 12 months being interest-free under the CBILS. Not all SMEs will be eligible. Further improvements to the scheme were announced on 2 April, which include substantially limiting the lender’s right to request (demand!) personal guarantees. Lenders can no longer request personal guarantees for loans under £250,000 and for loans over £250,000, personal guarantees will be limited to just 20% of any amount outstanding on the CBILS lending after any other recoveries from business assets. The scheme is “live” (from 23 March) and the BBB strongly recommends that the business’s current lender (assuming they are also a provider) is approached online. Current providers are here. Successful applicants are those that can demonstrate they need emergency funding and can trade out of any short-to-medium term difficulty. Further details are here.
Support for all
Mortgage payment holidays
Additional financial support for business owners and the self-employed has come in the form of a three-month mortgage holiday for homeowners struggling to make repayments due to the effects of COVID-19. This also includes buy-to-let mortgages. While a number of lenders had already announced repayment holidays, the Government’s latest announcement means now all lenders will have to honour the three-month time frame. Anyone struggling with repayments is advised to contact their lender directly.
Self-assessment Income Tax payments
It was previously announced that for the self-employed, self-assessment Income Tax payments due on 31 July 2020 are to be deferred until 31 January 2021. This means both the 31 July 2020 and 31 January 2021 payments become due on 31 January 2021. This is automatic with no application required. No interest will be charged during the deferral period. HMRC also updated its guidance (on 25 March) to make it clear that the deferral of self-assessment Income Tax payments applies to all self-assessment tax payers, not just the self-employed.
Time to Pay has been further extended as a result of the Winter Economy Plan. Applications for Time to Pay on all Income Tax and Capital Gains Tax due on 31 January 2021, over 12 months to 31 January 2022, will be accepted online by HMRC where the tax due is less than £30,00. Bespoke arrangements where the tax is greater than £30,000 can be agreed through HMRC’s telephone service.
No business is required to pay VAT from 20 March 2020 to 30 June 2020. While this is an automatic offer with no applications required we recommend businesses cancel their direct debits to avoid HMRC “accidentally” taking VAT payments during this period.
This announcement and other VAT aspects relating to COVID-19 including bad debt relief and other VAT measures and considerations are here.
Time to Pay (TTP) arrangements for tax
HMRC has set up a dedicated COVID-19 helpline (0800 024 1222) to help those in need to discuss and agree a bespoke TTP arrangement. It is understood that HMRC’s approach is an open willingness to allow businesses to defer tax payments. What is key is communicating with HMRC prior to the tax due date and that the business remains compliant with all its tax filing deadlines. Early action on this is highly recommended. Current experience is that HMRC are taking a light touch on the information they require before agreeing to a payment plan. Further details are here.
Statutory Residency Test
Has COVID-19 made you a UK resident?
HMRC have made some announcements relating to an individual’s tax residency status if they are unexpectedly required to remain in the UK due to the COVID-19 outbreak. Further details here.
The proposed changes have been deferred until April 2021. Further details are here.
It has been widely reported that cases of fraud or fraudulent attempts have substantially increased during the crisis. Fraudsters are taking advantage of this emergency and change of working environment measures to defraud organisations. We set out here our fraud awareness and preventative measures that organisations need to consider during these uncertain times.
Making a will in times of social distancing
Many people in these difficult times will be considering making a will for the first time or changing their will. It is important to remember that the signing requirements for a will are stringent, and if they are not followed the will may be invalid. For a will to be properly executed it must be signed in the presence of two independent witnesses. It is essential that any witness is not a beneficiary or the spouse of a beneficiary named in the will; if a beneficiary witnesses the will they will lose all entitlement under the will. Witnessing by videoconferencing is not permitted in England and Wales. Witnesses must be physically present and see you sign the will, this could however be through a window or from another room if you are in line of sight. It is recommended that if you need to rely on these measures, you should video the signing process so that it is clear formalities have been complied with. If you are in any doubt you should discuss your situation with your solicitor. The Law Society and other bodies are currently in discussion with the Ministry of Justice as to whether these requirements can be relaxed in the present situation. We will update you on any developments.
COVID-19 is a global crisis, and organisations need to access local knowledge from around the world to manage their operations. haysmacintyre is the south UK member of MSI Global Alliance, an association of independent but like-minded legal and accounting firms with over 260 member firms in more than 100 countries. MSI has established a dedicated COVID-19 webpage to share the articles of our fellow member firms, committed to helping international businesses navigate these uncertain times. The website is here. If you are interested in the COVID-19 measures introduced by a particular country and cannot find any details on the MSI dedicated page please email CV19@haysmacintyre.com.