8th July 2020
This article was last updated on 8 July at 13:50.
This is haysmacintyre’s recent changes page on the range of financial, tax and accounting measures being introduced to combat COVID-19 together with our related thoughts and insights on helping businesses with their cash-flow and compliance requirements.
Please visit regularly as this page will be revised as updates and new initiatives are announced.
For more information regarding your business, charity or individual queries, please visit our dedicated COVID-19 pages for:
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.
Changes in the last week:
The Chancellor has given his Summer Economic Update. The key tax measure announcements include:
- Confirmation that the Job Retention (furlough) Scheme will close, as scheduled, at the end October.
- A new Job Retention Bonus for employers of £1k for every employee brought back from furlough and still employed in January 2021.
- A ‘kickstart’ scheme to encourage employers to create new jobs for 18-24 year olds: employers will be paid up to £6,500 to cover salary costs and overheads for six months. Employees will work 25 hours per week and will be paid the National Minimum Wage.
- An increase in the Stamp Duty Land Tax (SDLT) threshold for property purchases to £500k, until 31 March 2021. This takes effect immediately.
- A reduction in VAT for the hospitality and tourism sectors from 20% to 5%, from Wednesday 15 July until 12 January 2021.
- ‘Eat out to Help Out’ vouchers for all – 50% discount (up to £10 each) on meals purchased Monday to Wednesday in August 2020 at participating restaurants, pubs and cafes. Providers can apply to participate from next week: cash will be returned to them within eight days.
We will provide a more detailed summary tomorrow (9 July). Please get in touch with your usual haysmacintyre contact or email CV19@haysmacintyre.com if you have any queries.
- VAT deferral scheme – HMRC have confirmed that the VAT deferral scheme ended on 30 June and have issued guidance on what businesses now need to do (including setting up previously cancelled direct debits). HMRC’s announcement is here. Our analysis of the VAT aspects relating to COVID-19 including bad debt relief and other VAT measures and considerations are here.
- Coronavirus Job Retention Scheme (CJRS) – the CJRS scheme entered its second phase from 1 July, including flexible furloughing. The ICAEW has published useful commentary which is here. The second phase also means the gradual introduction of the withdrawal of the scheme from 1 August. For our analysis on the re-introduction of employer contributions see here. The Government’s latest guidance is here.
- HMRC enquiries recommence – after suspending investigations as a result of the COVID-19 pandemic, HMRC is restarting its enquiries into business and personal taxpayers’ affair. We have already noticed this change as inspectors are re-engaging on open enquiries.
- Enterprise Management Incentives (EMI) and positive clarity over interaction with furloughed staff – new legislation will be introduced (as part of the Finance Act 2020) that temporarily relaxes the EMI working requirement condition. There was a concern that furloughed staff failed to meet the working time requirements of the EMI legislation (thereby potentially rendering their EMI option as no longer qualifying). The new clause provides that a disqualifying event does not occur in relation to an individual as a result of the individual taking leave, being furloughed or working reduced hours because of coronavirus disease. It relates to such a reduction in working time during the period from 19 March 2020 to 5 April 2021 (which can be extended by a treasury order until 5 April 2022 if required). Overall this means those EMI option holders that were furloughed continue to retain their option as a qualifying EMI option.
- Explanatory notes to the new clause is here and the legislation is here (as NC32 on page 9).
- The Corporate Insolvency and Governance Bill has received Royal Assent (25 June). This law introduces temporary amendments to insolvency and company law to help businesses navigate and address the challenges imposed by COVID-19. The law is here and accompanying explanatory notes are here. Our analysis of the Company Law changes are here.
- New R&D Roadmap to cement the UK as a science superpower (1 July) – the Government has published a “R&D Roadmap” which sets out its vision to attract global talent, cut unnecessary bureaucracy to make the UK the best place in the world for scientists, researchers and entrepreneurs. The R&D Roadmap is here. The announcement is here.
- Future Funds and (S)EIS compliance – the Government has published an amendment to Finance Act 2020 which advises that the repayment or conversion of any future fund loans will not result in any clawback of (S)EIS reliefs under the ‘receipt of value rules’ which should preserve existing income tax relief claimed. However the legislation does not go as far as to consider any shares acquired through the conversion of a future fund CLN to be a qualifying holding for EIS purposes, which could mean that any investor holding such shares in a personal capacity in the future could be prohibited from making further EIS-compliant investments in a company. Explanatory notes to the new clause is here. As previously announced the actual Future Fund investment (being a convertible loan) does not itself qualify for (S)EIS.
- Future Fund expanded (but not by much) – HM Treasury (HMT) has announced changes to the Future fund scheme’s eligibility criteria, which mean that UK companies who have participated in highly selective accelerator programmes and were required, as part of that programme, to have parent companies outside of the UK, will now be able to apply for investment.
- Emergency Budget – we still await confirmation as to whether the Chancellor will deliver an Emergency Budget. Per the press it was previously reported that such a budget would be in the w/c 6 July but that now looks very unlikely
- Early Corporation Tax Repayment – HMRC have updated their guidance covering situations where a company seeks repayment of tax before a return has been filed. This may arise be where a business knows that it has suffered (or is anticipated to suffer) large losses in a subsequent accounting period due to the Coronavirus. HMRC’s revised guidance is here and for companies that pay their tax by quarterly instalments, the guidance is here. This is a welcome change and follows representations made by the ICAEW’s Tax Faculty.
As we are acutely aware that this is a challenging time for businesses, 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. Please see below to view the recordings of our previous virtual events.
- A webinar for Fashion and Retail businesses, delivered by John Selwood, discussing key accountancy and reporting issues that the industry faces in light of COVID-19. Click here to view the webinar.
- A webinar for scaling and entrepreneurial businesses, hosted by Home Grown, covering topics including what should businesses be doing as a minimum during the COVID-19 pandemic, cash flow easing mechanisms, funding options and grant, loan and tax deferral schemes. Click here to view the webinar.
- A webinar for Property businesses focusing on the key accountancy and reporting issues that the industry faces in light of COVID-19, delivered by John Selwood. Click here to view the webinar.
- An interview between haysmacintyre’s Partner, Christopher Cork and our business partner, Elite, focusing on managing cash flow in a crisis. Click here to view the interview.
- A webinar for SMEs, hosted by Fresh Business Thinking, covering topics including furloughing staff, tax deferral schemes, funding options and financial reporting. Click here to view the webinar.
- A webinar for Creative, Media and Technology businesses focusing on practical advice, the Government’s schemes and grants and financial reporting. Click here to view the webinar.
- haysmacintyre and Northridge Law are pleased to share a pre-recorded webinar on how sports organisations can navigate year-end governance and finance during the COVID-19 pandemic. This webinar covers a range of legal and financial topics ranging from governance and risk during the pandemic to year end logistics and reporting challenges. To view the webinar, click here.
To view our upcoming virtual events, please click here.