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COVID-19 CORONAVIRUS – HEADLINES AND HOW CAN WE CAN HELP

Firstly, all my thoughts and well wishes are with you all, and hope you all keep safe and be sensible to avoid catching the Coronavirus. We have been taking a number of calls with regards to the current situation and apologises for not being able to get round to all of our clients. As a result, we have drafted the following brief note to keep you updated.

Since last week the Chancellor made announcements to help small and medium sized businesses. Many of these announcements have been extremely encouraging, however, the way to get help is still somewhat unclear.

On 20 March 2020, Boris Johnson  took the extraordinary step of ordering pubs, clubs and restaurants across the UK to close that night. This has affected a large number of our clients who operate as restaurants and take-aways but also shop-keepers and those supplying to the retail industry.

Please note, restaurants and take-aways can, for now, can remain open only if they are providing take-out food.

The Chancellor’s speech of 20 March 2020 announced an unprecedented wage-support scheme to try to prevent thousands or millions of job losses.

WHAT CAN WE DO

I am here to assist and help you to access what ever grants and loans there are available under the various Government Schemes and together we can get through these very troubling and difficult times for all our businesses.

At this moment in time, the various schemes are not accessible and when these various portals to access the schemes are available, I will contact you at that stage.

SCHEMES AND GRANTS AVAILABLE

The following is a summary of what is the current position based on the Chancellors speech on 20 March 2020 and information on the GOV.UK webpages on 20 March and this includes a package of measures to support businesses including:

  1. Coronavirus Job Retention Scheme (CJRS)
  2. Deferring VAT and Income Tax payments
  3. HMRC Time To Pay Scheme
  4. Statutory Sick Pay relief package for SMEs
  5. Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
  6. Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
  7. the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank – https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

CORONAVIRUS JOB RETENTION SCHEME (CJRS)

The Coronavirus Job Retention Scheme will be a government grant – employers can claim for 80% of furloughed workers wage costs, up to a cap of £2,500 per month.

The scheme will be:

  • Backdated to March 1st March 2020
  • Claimed initially for at least three months but could be extended ‘for longer if necessary’

Who is eligible for the CJRS scheme?

All UK businesses are eligible (or in the Chancellor’s words “Any employer in the country – small or large, charitable or non-profit – will be eligible for the scheme.”)

When will you be able to make a claim under the CJRS scheme?

No date has been set as yet, but the following are indications it will not be immediate:

  • “HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.”
  • “HMRC are working night and day to get the unprecedented Coronavirus Job Retention Scheme up and running and we expect the first grants to be paid within weeks.”
  • “If your business needs short term cash flow support, you may be eligible for the Coronavirus Business Interruption Loan Scheme”

What is a furloughed worker?

We understand that a furloughed workers are “workforce who remain on payroll but are temporarily not working during the coronavirus outbreak” per GOV.UK news story.

It is noted that employers will need to notify employees of this change in employment status to furloughed, but that changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.

OTHER GOVERNMENT ASSISTANCE

On 18 March 2020, the Scottish Government (https://www.gov.scot/news/gbp-2-2-billion-for-business/) support relating to business rate.

Economy Secretary Fiona Hyslop has addressed the Scottish Parliament on the economic impact of COVID-19 in Scotland.

In her statement she warned that as a result of coronavirus, the Scottish economy is facing an immediate collapse in demand.

She outlined the actions being taken by the Scottish Government to support businesses including a package of measures worth £2.2 billion from 1 April:

  • a full year’s 100% non-domestic rates relief for retail, hospitality and tourism
  • £10,000 grants for small businesses in receipt of the Small Business Bonus Scheme or Rural Relief
  • £25,000 grants for hospitality, leisure and retail properties with a rateable value between £18,000 and £51,000

Self employed

Sadly, with the exception of the VAT and 31 Jul income tax deferral payments and applying for Universal credit there is currently no income support as is the case for employees. The Government has stated that it is looking into the position with regards to the Self Employed and will make further announcements in due course.

Sources of further information

I would expect HMRC’s and the gov.uk websites will be updated to provide additional information on the CJRS scheme, Small Business Interruption Loans and grant claims for rates relief.

Once more information is available, I will contact you at that time. But for now please keep safe and follow all the Government guidance on social distancing.

PracticeWEB No Comments

Digital spending for SMEs passes £1.2bn

Small businesses have benefitted from the government spending £1.2 billion on digital services since 2012, according to official figures. 

Almost half of total spend – or £1.39 in every £3 – has gone to small and medium-sized enterprises (SMEs), which boosted the technology sector.

Public sector spending on cloud storage and IT support for businesses of all sizes reached a total of £2.6 billion over the same period.

The cash is being provided by public bodies through the Digital Marketplace, which is available for SMEs to source technology or people for digital projects in the public sector.

This has helped SMEs obtain government contracts to deliver efficient public services, often at cheaper rates than previously provided by multi-national suppliers. 

Caroline Nokes, minister for government resilience and efficiency, said:

“Small businesses have an important role to play in helping the government to spend taxpayers’ money wisely.

“That is why we continue to find ways of improving how the public sector, schools and hospitals, for example, puts money back into services for those they look after.”

Warren Smith, director of the Digital Marketplace, added:

“We are continually focused on breaking down the barriers to entry for SMEs to do business with government, for example, by simplifying the application process.”

Get in touch to discuss digital services for your business.

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Over a million save into Help to Buy ISA

Over a million people have now opened a Help to Buy ISA, with first-time buyers saving around £1.8 billion into their accounts.

The Help to Buy ISA scheme launched on 1 December 2015 enabling aspiring homeowners to save up to £200 a month towards buying a property worth up to £250,000, or £450,000 in London.

Once they’re ready to buy their first home, savers will benefit from a 25% government bonus which can be worth up to £3,000.

Those looking to purchase a home with a partner can open separate ISAs and claim government contributions to put towards buying their first property together.

The scheme has grown since its introduction almost 2 years ago, with the equivalent of 1,500 Help to Buy ISAs being opened every day. 

First-time buyers will be able to open a Help to Buy ISA until 30 November 2019. 

For existing account holders, they can continue saving into their Help to Buy ISA until 30 November 2029 when additional contributions will close.

Government contributions can be claimed until 1 December 2030.

Stephen Barclay, economic secretary to the Treasury, said:

“Reaching the landmark of 1 million Help to Buy ISAs shows the product’s success in helping first-time buyers save towards a home.

“Our Help to Buy schemes continue to prove hugely popular across the country as we support people to get on in life and achieve their dream of climbing the housing ladder.”

Contact us to discuss purchasing your first property.

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Government cracks down on pension scams

Cold-callers who attempt to scam people out of their retirement savings face fines of up to £500,000 under new legislation.

The crackdown will prevent fraudsters making unauthorised contact with savers over the phone, email and text as the government bids to end millions of cold calls made each year.

Ministers announced the move after revealing retirement savers lost almost £5 million through pension-related bogus calls in the first five months of 2017.

Actions include:

  • banning all cold calls (including emails and texts) in relation to pensions
  • tightening rules stopping scammers from opening fraudulent pension schemes
  • tougher action to prevent the transfer of cash from pension schemes to fake accounts.

The cold-calling ban will not form part of a second Finance Bill 2017, due for release in the coming months, so it is unclear when the ban will come into force.

Guy Opperman, minister for pensions and financial inclusion, said:

“People’s savings are being targeted and stolen through elaborate hoaxes – leaving them with little opportunity to build up their savings again.

“If people have saved for a private pension, we want to protect them. This is the biggest lifesaving that individuals normally make over many years of hard work.

“By tackling these scammers, people should know that cold calling, apart from exceptional circumstances, is banned.”

Contact us for advice on protecting your savings.

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Unemployment rate falls to 4.4%

Unemployment fell to 4.4% in the 3 months to June 2017 – down from 4.9% to its lowest rate since 1975.

Figures from the Office for National Statistics (ONS) show unemployment fell by 57,000 between April and June 2017, while 338,000 more people were in employment than the same period last year.

However, with inflation remaining at 2.6%, real wage earnings fell by 0.5% (including any bonuses).

Average weekly earnings for employees in nominal terms increased by 2.1% compared to a year ago.

Productivity was 0.1% lower than in Q1 2017, with the ONS saying it remains “around the same level as its pre-downtown peak”.

Matthew Percival, head of employment at the Confederation of British Industry, said:

“Continuing strong employment growth is tainted by falling real wages, reducing household spending power.

“Productivity has been falling throughout 2017 – this matters as rising productivity is the only sustainable route to higher wages and better living standards.

“It’s therefore incumbent upon the government to work with businesses to protect the flexible labour market and design an industrial strategy that will drive productivity and wage growth.”

Discuss your business obligations with us.