Category Archives: Covid-19

Business owner wearing face mask and gloves standing with arms crossed at workplace in warehouse looking through window.

Worried COVID Plan B may affect you or your business?

Here’s what you need to know

The pandemic and its restrictions have placed a strain on all of us. It is not surprising that many fear the return of more measures that restrict our lives and businesses.

There is growing concern that we are heading towards another spike in infections and a move to Plan B – what does this mean for you?

What is Plan A?

We are currently in Plan A. This strategy focuses on limiting the spread of COVID by:

  • Ensuring as many people as possible are vaccinated
  • Maintaining track and trace systems
  • Providing additional support to the NHS and social care.

What is Plan B?

Plan B would attempt to prevent a further rise in COVID hospitalisations and deaths.

This strategy could include the following measures:

  • Communicating “clearly and urgently” with the public that the risk level has increased
  • ‘Vaccine passports’ for entry to some indoor events and venues
  • The return of mandatory face coverings in some indoor spaces
  • Recommendations to work from home
  • The public going “out of their way” to support and help the health service
  • Recruiting NHS volunteers and encouraging retired healthcare workers to re-enter the health service.

The Government has not confirmed that it intends to bring in any of these measures but it is under pressure from the NHS and other experts to implement these restrictions before rates rise drastically.

Are you likely to be affected?

While the new measures are by no means as strict as earlier lockdowns, they could affect how some businesses operate and elements of your daily life.

If you are concerned about the business implications please contact us.

Kickstart Scheme and apprenticeship incentives extended

Speaking at the Conservative Party Conference in Manchester, the Chancellor, Rishi Sunak announced extensions to both the Kickstart Scheme and incentives to employers to take on apprentices.

The Kickstart Scheme

Government support for the Kickstart Scheme, which helps employers offer work placements to 16-24 year olds on Universal Credit will be extended to March 2022 with applications for employers remaining open until 17 December 2021.

Apprenticeships

Meanwhile, the Chancellor confirmed that the Government will continue to offer £3,000 incentive payments to employers that take on apprentices until 31 January 2022.

Find out more

Further details of these measures are expected in the Budget on Wednesday 27 October.

If you are planning to take on staff for the first time or to increase your workforce, please contact us today for help and advice.

Final SEISS deadline – Submit your claim by 30th September!

If you are applying for the fifth and final grant of the Self-Employment Income Support Scheme (SEISS), you must ensure that your application and any necessary documents are with HM Revenue & Customs (HMRC) by 30th September.

If you fail to submit your claim in time, it will not be processed

Claim now

Those eligible to make a claim for the fifth SEISS grant need to:

  • Apply on or after their personal start date given to them by HMRC
  • Tell HMRC that they intend to carry on trading in 2021/22
  • Reasonably believe there will be a significant reduction in their trading profits between 1 May and 30 September 2021 due to the pandemic.

Don’t forget the turnover test!

Following changes to the SEISS, there are two levels of grant available, which are dependent on your turnover.

This ensures that those whose turnover fell by:

  • 30 per cent or more will continue to receive a grant worth 80 per cent of three months’ average trading profits (capped at £7,500).
  • Less than 30 per cent will receive a reduced grant equal to 30 per cent of three months’ average trading profits (capped at £2,850).

The figures used in this calculation are not profit but rather gross sales for all concurrent trades. All COVID-related grants received should be excluded from your turnover figure.

Here to help

While we cannot complete the fifth SEISS application on your behalf, we are happy to provide advice on your turnover.

The fifth round of the Self-Employment Income Support Scheme (SEISS) is now open

HM Revenue & Customs (HMRC) has announced that the portal for the fifth round of the Self-Employment Income Support Scheme (SEISS) is now open.

In recent weeks, the tax authority has been directly contacting taxpayers that it believes are eligible for the fifth round of the scheme, providing them with their personal claim date.

These individuals can now make a claim from this date using the link below:

Make a claim via the SEISS claims portal

Taxpayers can claim from their personal claim date up until the claims service closes on 30 September 2021.

Earlier this month HMRC published detailed guidance for the fifth round of the Self-Employment Income Support Scheme (SEISS), which confirmed the following:

Eligibility

To be eligible for the grant, an individual’s trading profits in 2019 to 2020 must have been no more than £50,000 and must have been at least equal to income from other sources.

Self-employed individuals must also confirm that they:

  • Intend to continue to trade in 2021 to 2022; and
  • Reasonably believe there has been a significant reduction in their trading profits due to reduced business activity, capacity, demand or inability to trade due to Coronavirus from May 2021 to September 2021.

They will also need to keep records of evidence that supports their declaration.

Turnover

Unlike previous rounds of the scheme, the fifth round of the SEISS will offer two levels of grant, depending on the impact Coronavirus has had on a self-employed individual’s turnover in a 12-month period beginning between 1 and 6 April 2020.

Those whose turnover fell by 30 per cent or more will once again be able to claim a grant worth 80 per cent of three months’ average trading profits, capped at £7,500 in total.

Meanwhile, those whose turnover fell by less than 30 per cent will be able to claim a grant worth 30 per cent of three months’ average trading profits, capped at £2,850 in total.

Self-employed individuals who have already completed their 2020 to 2021 Self-Assessment Tax Returns can find their turnover figures there, although they should not include anything reported as ‘other income’.

They should also be aware that this figure will only apply to a 12-month figure beginning on 6 April 2020 and turnover for a period beginning earlier in April 2020 could be different.

Previous SEISS grants, Eat Out to Help Out payments and local authority or devolved administration grants should not be counted towards turnover figures for the purposes of the scheme.

However, with 2020 to 2021 Self-Assessment Tax Returns not due until 31 January 2022, many self-employed individuals will not yet have completed a return. In these circumstances, HMRC advises that individuals should:

  • Check their accounting software
  • Go through bookkeeping or spreadsheet records that cover self-employment invoices and payments received
  • Check the bank account they use for their business to account for money coming in from customers

This turnover figure should then be compared with the figure reported on a 2019 to 2020 Self-Assessment Tax Return to calculate the percentage fall in turnover during the year to April 2021 and reported to HMRC. Self-employed individuals can access their previous returns by accessing their personal tax account online.

Where 2019 to 2020 was not a normal trading year for a self-employed individual, they may use the turnover reported in their 2018 to 2019 Self-Assessment Tax Return. However, they must show how 2019 to 2020 was not a normal year.

HMRC gives the following examples of circumstances that might have meant 2019 to 2020 was not a normal year:

  • Being on carers leave, long-term sick leave or having a new child
  • Carried out reservist duties
  • Lost a large contract
  • Did not submit a 2019 to 2020 return for reasons that mean you are still eligible for a grant, such as having a new child.

Self-employed individuals who began trading in 2019 to 2020 and did not trade in any of 2018 to 2019, 2017 to 2018 or 2016 to 2017, may claim 80 per cent of three months average trading profits, capped at £7,500 in total, as long as they meet the other eligibility criteria.

In a slight change to the earlier guidance, for the purposes of the turnover test partners making a claim should use turnover for the partnership as a whole, except if they have another business (either a sole trade or partnership), in which case they use their share of partnership turnover when making the comparison.

The clarifies that the profit share rules apply only when the partner has multiple trades in either 2019/20 or the pandemic period.

Taxable treatment of the grant

SEISS grants are subject to Income Tax and National Insurance Contributions and must be included on a 2021 to 2022 Self-Assessment Tax Return. Grants are also counted toward annual allowances for pension contributions.

For help and advice, please contact us.

 

Government updates self-isolation rules with limited exemptions for 16 sectors

While most Covid restrictions in England ended on Monday 19 July, the requirements for people testing positive and their close contacts to self-isolate will continue to apply until 16 August, when they will change for under-18s and double-vaccinated adults.

However, with more than 600,000 people required to self-isolate as close contacts of a positive Covid case in the last week, fears are growing over consequent staffing shortages in critical sectors.

This has prompted the Government to update its guidance on NHS Test and Trace in the workplace to provide limited exemptions to self-isolation for named double-vaccinated individuals working in any of 16 sectors, where the appropriate Government department has given written consent.

The requirements to qualify for the exemption are extremely stringent. Individuals must:

  • Work in ‘critical elements of national infrastructure’; and
  • Their absence must be likely to result in the loss or compromise of this infrastructure; and
  • Have a major detrimental impact on the availability, integrity or delivery of essential services; or
  • Have a significant impact on national security, defence or the functioning of the state.

Affected employees will only be able to leave self-isolation to undertake critical work and must otherwise self-isolate.

The 16 sectors and appropriate Government departments are:

Department Main sectors covered Contact details
BEIS Energy

Civil nuclear

beisquarantine.exemptions@beis.gov.uk
DCMS Digital infrastructure dcms.coronavirus@dcms.gov.uk
Defra Food production and supply

Waste

Water

Veterinary medicines

Essential chemicals

emergencies@defra.gov.uk
DfT Essential transport cv19pmo@dft.gov.uk
DHSC Medicines

Medical devices

Clinical consumable supplies

covid19.criticalworker@dhsc.gov.uk
Home Office Emergency services

Border control

covid19operationsandpolicy@homeoffice.gov.uk
MoD Essential defence outputs spo-covidteam@mod.gov.uk
MHCLG Local government lgresponse@communities.gov.uk

To qualify for an exemption, an employer must contact the appropriate department with information on the individuals they wish for it to apply to, their roles, and the likely impact of their self-isolation.

If agreed, the department will then write to the employer with the names of exempted employees. An exemption will only apply to employees whose employer receives such a letter that names them.

Other arrangements apply to workers in frontline health and social care roles and up to 500 workplaces in the food supply chain will be able to use daily testing instead of self-isolation from next week as part of a separate initiative.

Link:  https://www.gov.uk/guidance/nhs-test-and-trace-workplace-guidance

Freedom Day – What does it mean for businesses?

On 19 July the majority of the remaining Coronavirus pandemic restrictions will end in England, with a similar reduction of measures in Wales and Scotland.

Commonly being referred to as Freedom Day, this final step in reopening the economy will see many of the rules placed upon businesses removed.

Instead, the Government has decided to make many of the previous measures voluntary, therefore, shifting much of the responsibility onto individuals and employers.

What rules are changing?

The relaxation of the rules from 19 July differs slightly in each nation of the United Kingdom, but in England, the following measures will change:

  • There will no longer be any limits on how many people can meet
  • Social distancing is no longer required, except in some places like hospitals and border control
  • Masks and face coverings are no longer a legal requirement
  • Night clubs can reopen
  • Restaurants and pubs are no longer required to only offer table service
  • No limits on visitors to concerts, theatres or indoor events, including business conferences
  • Fully vaccinated adults in the UK will no longer have to quarantine for 10 days after returning from nations on the amber list
  • Under-18s won’t need to quarantine
  • Double-vaccinated adults do not need to self-isolate if they simply come in contact with someone who later tests positive (if they test positive themselves then they must self-isolate).

Although not enforced, the Government also recommends that people try to meet outside instead of indoors, where possible, and it is encouraging the continued use of face masks in crowded public settings.

The day will also mark the end of the ‘work from home’ recommendations made by the Government, however, Prime Minister Boris Johnson has called for businesses to attempt a “gradual return” to the workplace, where possible (although this will not be legally binding).

Employer obligations

Employers have many important obligations when it comes to the health and safety of their staff and visitors to their place of business.

This means that whilst the rules have changed, they must still meet these important responsibilities.

Under the Health and Safety at Work Act 1974, employers must ensure, so far as is reasonably practicable, the health, safety and welfare of all their employees at work.

As a result of this requirement, where employers decide to remove the requirement to wear a mask in the workplace, reduce social distancing or remove screens they could potentially breach their duties as it may lead to an increased risk of transmission of COVID-19.

This duty is also extended to employees, who must take reasonable care for their health and safety and that of anyone who may be affected by their acts or omissions while at work.

Beyond these legal obligations, some employers may face challenges from staff and visitors over policy changes which they should be prepared for.

Next steps

With the new rules focusing on the responsibilities of individuals and businesses, instead of a set of legally enforceable regulations, there is not a single approach for managing the workplace post-Freedom Day.

The steps that businesses decide to take will likely depend on how they operate, the risks to employees and staff and commercial considerations.

With this in mind, employers should:

  • Conduct a fresh risk assessment of their business in light of the new rules
  • Ensure that all reasonable steps have been taken to protect the health and safety of those entering the workplace, including visitors and customers/clients
  • Review whether employees need to return to the workplace full time or can continue to work remotely, or flexibly
  • Communicate all new policies and procedures with employees and customers/clients
  • Continue to monitor risks within the business, taking into consideration changes to the rate of infection
  • Offer support to staff who continue to work from home, including supporting their well being
  • Support staff returning from home working or furlough with additional training if necessary.

The list of things for businesses to consider could be exhaustive, but they should focus on the points highlighted above to ensure they meet their legal obligations.

Are there any financial implications to Freedom Day?

Although there aren’t any specific rules regarding financial elements of running a business, the 19 July does mark a turning point for many companies.

For those in the hardest-hit industries, such as travel, leisure, hospitality and entertainment, the relaxing of rules is likely to be celebrated as it will allow revenues to rise once again.

However, the changes also come at a time when many of the Coronavirus financial support mechanisms are being whittled away.

The Government has begun to wind down the furlough scheme by increasing employer contributions, reduced the lower threshold for Stamp Duty Land Tax and is tapering away business rates relief.

Many businesses are also having to contend with the repayment of loans, deferred VAT and tax.

Here to help

As the pandemic restrictions draw to a close, we just wanted to reassure you that our experienced team are standing by to support you.

Throughout lockdown, we have proudly worked with a wide range of businesses to overcome difficult and complex issues and our commitment remains the same as the UK looks to rebuild and recover.

If you need advice or would like to discuss your plans for the future, please contact us

Guidance for the fifth round of the Self-Employment Income Support Scheme (SEISS) published

HM Revenue & Customs (HMRC) has published detailed guidance for the fifth round of the Self-Employment Income Support Scheme (SEISS), which will open for claims in the coming weeks.

Instead of announcing a specific date on which the new round of the scheme will go live, HMRC will contact self-employed individuals it has identified as potentially being eligible for a grant from ‘mid-July’, with claims opening in ‘late-July’.

It has, however, announced a closing date for the scheme of 30 September 2021.

Eligibility

To be eligible for the grant, an individual’s trading profits in 2019 to 2020 must have been no more than £50,000 and must have been at least equal to income from other sources.

Self-employed individuals must also confirm that they:

  • Intend to continue to trade in 2021 to 2022; and
  • Reasonably believe there has been a significant reduction in their trading profits due to reduced business activity, capacity, demand or inability to trade due to Coronavirus from May 2021 to September 2021.

They will also need to keep records of evidence that supports their declaration.

Turnover

Unlike previous rounds of the scheme, the fifth round of the SEISS will offer two levels of grant, depending on the impact Coronavirus has had on a self-employed individual’s turnover in a 12-month period beginning between 1 and 6 April 2020.

Those whose turnover fell by 30 per cent or more will once again be able to claim a grant worth 80 per cent of three months’ average trading profits, capped at £7,500 in total.

Meanwhile, those whose turnover fell by less than 30 per cent will be able to claim a grant worth 30 per cent of three months’ average trading profits, capped at £2,850 in total.

Self-employed individuals who have already completed their 2020 to 2021 Self-Assessment Tax Returns can find their turnover figures there, although they should not include anything reported as ‘other income’. They should also be aware that this figure will only apply to a 12-month figure beginning on 6 April 2020 and turnover for a period beginning earlier in April 2020 could be different.

Previous SEISS grants, Eat Out to Help Out payments and local authority or devolved administration grants should not be counted towards turnover figures for the purposes of the scheme.

However, with 2020 to 2021 Self-Assessment Tax Returns not due until 31 January 2022, many self-employed individuals will not yet have completed a return. In these circumstances, HMRC advises that individuals should:

  • Check their accounting software
  • Go through bookkeeping or spreadsheet records that cover self-employment invoices and payments received
  • Check the bank account they use for their business to account for money coming in from customers

This turnover figure should then be compared with the figure reported on a 2019 to 2020 Self-Assessment Tax Return to calculate the percentage fall in turnover during the year to April 2021. Self-employed individuals can access their previous returns by accessing their personal tax account online.

Where 2019 to 2020 was not a normal trading year for a self-employed individual, they may use the turnover reported in their 2018 to 2019 Self-Assessment Tax Return. However, they must show how 2019 to 2020 was not a normal year.

HMRC gives the following examples of circumstances that might have meant 2019 to 2020 was not a normal year:

  • Being on carers leave, long-term sick leave or having a new child
  • Carried out reservist duties
  • Lost a large contract
  • Did not submit a 2019 to 2020 return for reasons that mean you are still eligible for a grant, such as having a new child.

Self-employed individuals who began trading in 2019 to 2020 and did not trade in any of 2018 to 2019, 2017 to 2018 or 2016 to 2017, may claim 80 per cent of three months average trading profits, capped at £7,500 in total, as long as they meet the other eligibility criteria.

Taxable treatment of the grant

SEISS grants are subject to Income Tax and National Insurance Contributions and must be included on a 2021 to 2022 Self-Assessment Tax Return. Grants are also counted toward annual allowances for pension contributions.

For help and advice, please contact us.

CJRS – Upcoming changes to payments and the furlough scheme

The Coronavirus Job Retention Scheme (CJRS) continues to support many businesses, who are reliant on the financial support it offers to cover the costs of staff on furlough.

Extended earlier this year in the Budget, support from the CJRS will slowly be withdrawn in the next three months before closing altogether at the end of September.

The withdrawal of this scheme could have a substantial financial impact on businesses and so they must be prepared for the changes ahead.

As with the existing scheme, furloughed employees will continue to receive 80 per cent of their usual wages capped at £2,500 a month, or equivalent weekly or daily figures, for usual hours not worked right up until the scheme ends later this year.

However, from 1 July, employers must make a 10 per cent contribution to these costs, as the Government grant will only cover 70 per cent of the costs (capped at £2,187.50).

In August and September, the Government grant will then drop again to 60 per cent (capped at £1,875), meaning that employers must make a 20 per cent contribution to the amount paid to employees.

The calculation of usual wages is still based on the last pay period before the employee became eligible for furlough.

Those dates vary, depending on whether the employee was reported to HMRC on or before 19 March 2020, 30 October 2020 or 2 March 2021.

Any pay rises since an employee’s reference date are not taken into account for any time they are furloughed.

Employers need to make early assessments as to whether they will continue to support furloughed employees going forward, especially if they are considering making redundancies as a result of the withdrawal of funding.

Employers need to remain mindful of their obligations in relation to collective redundancy consultation as, depending on the number of redundancies they intend to make, they may be required to report redundancies to the Secretary of State for Business, Energy and Industrial Strategy either 30 or 45 days in advance of dismissing employees.

If you need assistance with the changes ahead or are concerned about the potential cost implications of the furlough scheme ending, please contact us.

Preparing for the end of the Stamp Duty Holiday

Introduced in July 2020, the Stamp Duty Land Tax (SDLT) Holiday has helped hundreds of homeowners and investors to reduce the cost of purchasing a new property.

However, the higher SDLT thresholds will change from 1 July increasing the cost of buying or transferring a home.

From the beginning of July, the SDLT rules will change so that the threshold at which tax is paid falls from £500,000 to £250,000.

This new rate of SDLT will remain in place until 1 October 2021, when it will fall again to just £125,000.

The new rates will be as follows:

Property or lease premium or transfer value from 1 July SDLT rate
Up to £250,000 0 per cent
The next £675,000 (the portion from £250,001 to £925,000) 5 per cent
The next £575,000 (the portion from £925,001 to £1.5 million) 10 per cent
The remaining amount (the portion above £1.5 million) 12 per cent
Property or lease premium or transfer value from 1 October SDLT rate
Up to £125,000 0 per cent
The next £125,000 (the portion from £125,001 to £250,000) 2 per cent
The next £675,000 (the portion from £250,001 to £925,000) 5 per cent
The next £575,000 (the portion from £925,001 to £1.5 million) 10 per cent
The remaining amount (the portion above £1.5 million) 12 per cent

Despite the changes, first-time buyers paying £300,000 or less for a residential property will continue to pay no SDLT and will only pay five per cent on properties worth between £300,000 and £500,000.

The latest changes are likely to subdue the market somewhat, as they will increase the costs of most transactions, especially given that the average UK house price in April 2021 was £251,000 according to the Office for National Statistics.

For landlords and investors, the impact will be far greater as they must pay an additional three per cent surcharge on each rate if they own more than one property already.

The costs could be even greater if the investor is non-resident in the UK due to the new two per cent surcharge for overseas buyers of UK property that has been introduced from April on top of the existing three per cent additional home surcharge.

For them, from 1 July, they could pay the following rates on property purchases or transfers if they already own a property in the UK:

Property or lease premium or transfer value from 1 July SDLT rate
Up to £250,000 5 per cent
The next £675,000 (the portion from £250,001 to £925,000) 10 per cent
The next £575,000 (the portion from £925,001 to £1.5 million) 15 per cent
The remaining amount (the portion above £1.5 million) 17 per cent

Homebuyers, landlords and property investors need to carefully consider these changes as they could have a substantial impact on property values.

If you need advice on the upcoming changes to SDLT, please speak to a member of our team.

Government extends ban on commercial evictions until March 2022

The Treasury has reassured many distressed business owners by confirming that a moratorium on commercial evictions introduced in April 2020 will now be extended for another year.

The ban, introduced more than a year ago, has already been extended twice and was due to expire at the end of June but will now remain in place until at least March 2022.

Under the temporary rules, landlords of commercial properties are restricted from evicting tenants and are not permitted to recover rent arrears by selling a tenant’s goods.

Although not much additional financial support has been given in relation to the extension of lockdown restriction until 19 July, the Chief Secretary to the Treasury Stephen Barclay confirmed that help would be offered via the moratorium to struggling businesses.

Speaking in a statement on the economy in the Commons, Mr Barclay said that the extension to the current moratorium “strikes the right balance between protecting landlords and supporting those businesses that are most in need”.

He added: “We will introduce legislation in this parliamentary session to establish a backstop so that, where commercial negotiations between tenants and landlords are not successful, tenants and landlords go into binding arbitration.

“Until that legislation is on the statute book, existing measures will remain in place including extending the current moratorium to protect commercial tenants from eviction to 25 March 2022.”

The Government has reiterated that, where possible, tenants should start to pay rent again under the terms of their lease or as otherwise agreed with their landlords once restrictions are removed on their sector.

While this latest extension is positive news for many businesses, particularly those in hard-hit sectors such as hospitality and leisure, for commercial property landlords it may mean many more months without rental income or the option to evict tenants to bring in new paying businesses.

If you are affected financially by the latest extension to the ban and would like advice, please contact us.