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Daily Update - 30th June
Good morning,
A summary of the latest news announcements and key dates over the past week is set out below.
Easing of restrictions
Caravan sites and self-catering properties were allowed to open from last Friday – and the rain arrived just on time! The current timetable for reopening is summarised below (with later dates still subject to ratification):
3rd July
- Guesthouses, guest accommodation, B&Bs, hotels and hostels
- Restaurants, cafés, coffee shops
- Visitor attractions
- Betting shops
6th July
- Nail, beauty, hair salons and barbers and tanning services, electrolysis or acupuncture
- Spas
- Tattoo and piercing parlours
10th July
- Indoor gyms
- Outdoor leisure playgrounds
17th July
- Competitive sports can resume from Wednesday 17 July 2020 along with limited numbers of outdoor spectators permitted
- Numbers to be increased from 31 July 2020.
29th July
- cinemas
- theatres
- nightclubs
- bingo halls
- concert halls
- arcades
7th August
- indoor sports courts and skating rinks
- leisure centres and soft play areas
28th August
- socially distanced indoor spectators
All of the above openings are subject to businesses adhering to health and safety guidelines. This link provides guidance for employers.
The HSENI has also provided a risk assessment template which can be used when reopening.
Job Retention Scheme ("JRS")
The JRS will change from Wednesday 1 July and employers will be able to avail of the flexibilities allowed by the extension to the scheme. The scheme will allow businesses to manage staff costs while they are not yet operating at full capacity.
From 1 August, employers will be expected to contribute to the scheme and employers NICs or pension contributions will no longer be included. From 1 September, employers will also have to contribute 10% of wages for the hours the employee is on furlough and this will increase to 20% from 1 October.
Claims for furlough periods ending on or before 30 June 2020 must be made before 31 July 2020.
Guidance has been updated to advise what to do in the case of an error in previous claims.
- When you make your next claim you can reduce the amount to take account of a previous overclaim.
- If you have overclaimed and you do not plan to submit any further claims then you should contact HMRC. Once you have contacted HMRC you will be given a payment reference number and directed to make a payment
- If you have made an error that has resulted in an underclaimed amount, you should contact HMRC to amend your claim. As you are increasing the amount of your claim, HRMC will need to conduct additional checks.
If you would like any information on our JRS Health Check, please contact your client manager.
Self-Employment Income Support Scheme ("SEISS")
Claims for the first grant must be made on or before 13th July. Applicants can now use their NI drivers licence to apply which is good news as this had caused quite a lot of difficulty when claiming the first grant.
The second grant will open in August and in order to claim it applicants must certify that they have been impacted by COVID-19 on or after 14th July 2020. Draft legislation allows HMRC to reclaim payments that recipients are not entitled to for both the JRS and SEISS and apply penalties in cases of deliberate non-compliance. Therefore, it is important that people claiming either of the SEISS grants document the reasons why they have been impacted by COVID-19.
Apply for moratorium under the Corporate Insolvency and Governance Act 2020.
The Bill received Royal Assent on 25/06/2020 and came into force in Northern Ireland on 26/06/2020. The Act provides for the following:
- The Act allows for struggling businesses to avail of formal breathing space via a Moratorium in order to pursue a rescue plan. During the moratorium no legal action can be taken against the company without leave of the court. If the company is eligible the Moratorium will last for an initial 20 business days and can be extended in certain circumstances.
- The restructuring measures will support companies with debt obligations to restructure under a new procedure. The court may sanction a plan that binds dissenting creditors to a restructuring plan if it is fair and equitable and in the interests of creditors.
- Prohibition of Termination Clauses to prevent suppliers from enforcing a termination clause in a contract if a company enters an insolvency process.
- Temporary suspension of wrongful trading up to 30th September 2020 and can be extended
- The Bill temporarily removes the threat of winding-up proceedings where the unpaid debt is due to Covid-19 by introducing temporary provision to void statutory demands and winding up petitions issued against companies until 30th September and can be extended
- The Bill temporarily removes the requirement for meetings in person in order to fulfil companies' legal filing requirements.
- For a temporary period this will allow companies and other types of businesses registered at Companies House more time to file accounts, confirmation statements and details of relevant events, such as a change in director.
The UK government has set out guidance on how to apply for a moratorium.
COVID-19 and Brexit support
The impact of Covid-19 combined with the uncertainties around a post Brexit economy means that many businesses will require additional advice on how to navigate through the next year or more.
Intertrade Ireland is offering two support programmes to assist manufacturing or tradable services businesses who engage in cross border trade.
- Emergency Business Solutions which provides professional advice, to the value of £2,000
- The E-Merge programme provides £2500 fully funded consultancy support to help businesses develop online sales and eCommerce solutions
- Brexit Planning voucher which provides 100% financial support up to £2,000 towards professional advice to help businesses to identify Brexit exposure and to plan
Invest NI is still offering their Brexit Preparation Grant which offers customers financial support up to a maximum of £50,000 at a rate of up to 50%, to plan for the post-Brexit environment. Eligible support includes:
- Grant assistance up to 50% of one year's salary, to a maximum £20,000, to engage a new or re-deploy an existing member of staff in a Brexit preparation project
- Assistance up to £10,000 for a maximum period of 12 months, for office rental located outside the UK, for market research purposes
- Up to a maximum £25,000 for specialist consultancy fees for Brexit-related activities
If you would like further information on any of the grants above, please contact your client manager.
Companies House
Companies House has introduced a temporary service to upload certain documents during the coronavirus outbreak. The service now allows users to upload change of constitution forms.
If you require any further information please contact your client manager.
Daily Update - 22nd June
The update and news over the past week are summarised below.
Lock down restrictions eased
The Executive has announced that groups of up to 6 people are allowed to meet indoors and those who are shielding will be able to form a support bubble with one other household from 6 July.
Job Retention Scheme
The step-by-step guide for claiming via the JRS has been updated to reflect the changes in the scheme from 1 July 2020. Rather than detailing any calculations, it refers users back to the main Government guidance.
Since the updated guidance was released on the 12th June, there has been a further update with a new template to be used for claims with more than 100 employees. We expect there to be additional details released in respect of the extension to the scheme including the payment of holiday pay for employees who have returned to work on the flexible furlough arrangement.
HMRC has confirmed that it has received over 3000 reports of furlough fraud since April. They have restarted inspections and one of the areas which they will focus on is the mis-use of the JRS and SEISS. However, it has advised some employers may accidently be committing furlough fraud and that one third of their investigations did not warrant further investigations. This does however show the importance of keeping appropriate records for furlough claims.
We are offering a JRS Health Check in which we will review claim calculations and documentary evidence and identify any inaccuracies which can reduce the risk of any penalties in the event of a HRMC audit. CLICK HERE to see the attached leaflet for more information.
CavanaghKelly also provides Tax Investigation Insurance which includes:
- Representation from us in the event of an HMRC enquiry into your personal tax returns, PAYE or VAT. We will deal directly with HMRC on your behalf.
- An insurance policy that will cover our fees with zero excess.
If you have any queries on the JRS Health Check or the Tax Investigation insurance, please contact your client manager.
VAT payments
The Government previously announced that VAT payments due between 20 March 2020 and 30 June 2020 could be deferred until 31 March 2021. It has been reported that Treasury will announce a package of measures in July to support sectors impacted by COVID-19 and one of the measures being discussed is a possible 3 month extension to the deferral period. It has also been suggested that there will be a reduction in VAT for a fixed period.
However, as it currently stands, the VAT deferral period ends on 30 June 2020 and businesses who availed of the deferral period should now:
- set-up cancelled direct debits in enough time for HMRC to take payment
- submit VAT returns as normal, and on time
- pay the VAT in full on payments due after 30 June
Businesses who cannot afford to pay their VAT should contact HMRC as soon as possible to see if it possible to set up a Time to Pay arrangement.
Hospitality and tourism
With the hospitality and tourism sector getting ready to reopen for business over the next few weeks, the social distancing rules will mean that most businesses will see a reduction in turnover due to restrictions on seating space. Many businesses will be thinking about applying for a cafe licence to have additional seating on outdoor spaces and Belfast City Council has confirmed that the cost of this licence will be waived during the COVID-19 crisis.
Supplier Payments
Conor Murphy has announced the extension of measures to ensure Government Departments continue paying suppliers impacted by Covid-19. Relief measures for suppliers who provide goods and services, and construction contractors, for which demand has reduced or been paused temporarily due to Covid-19 will continue to be provided until October 2020.
Commercial tenants
A special provision in the Coronavirus Act 2020 applied from 25 March 2020 to 30 June 2020 which meant that landlords could not exercise the provision to forfeit a lease in the event of non-payment of rent during this period. The DoF has now extended this period to 30 September 2020.
A new Code of Practice for landlords and tenants was published yesterday which encourages tenants to continue to pay their rent in full if they can, while acknowledging that landlords should provide support to businesses in difficulty.
If you have any questions, please contact your client manager.
Daily Update - 16th June
There have been further easing of restrictions with many shops opening last Friday and the welcome news yesterday that hotels, bars and restaurants can open from 3 July. We just need the hairdressers and barbers to open now so that we can get a bit of a tidy-up before we go out for dinner on the 3rd!
Ease of restrictions
The Executive have announced further easing of lockdown restrictions.
From 26th June the following businesses can re-open:
- Holiday and home parks
- Caravan sites
- Self-catering properties
From 3 July 2020 the following tourism and hospitality businesses can re-open:
- Guesthouses, guest accommodation, B&Bs, hotels and hostels (hotel spa’s and leisure facilities are not allowed to open)
- Restaurants, cafés, coffee shops (Indoor pubs/bars can sell alcohol where a meal is served and outdoor spaces can serve alcohol on a table service basis)
- Visitor attractions
Job Retention Scheme
Guidance was released on Friday night in relation to the extension to the scheme and provides some further information on the flexibilities. From 1 July 2020 the scheme will operate as follows:
- Employers will only be able to claim for employees who have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March 2020 and 30 June
- Employers can bring employees back to work for any amount of time, and any work pattern
- Where employers flexibly furlough staff, they must keep a new written agreement that confirms the new furlough arrangement
- Employers can claim the furlough grant for the hours flexibly furloughed employees do not work, compared to the hours they would normally have worked in that period
- The wage cap will be proportional to the hours not worked
- Records must be kept of 'usual' hours worked and actual hours worked for flexibly furloughed
- The calculation methods are changing and you need to work out the 'usual wage'
- Claim periods starting on or after 1 July must start and end within the same calendar month and must last at least 7 days unless you're claiming for the first few days or the last few days in a month
- The number of employees you claim for in any single claim period starting from 1 July cannot exceed the maximum number of employees you claimed for under any claim ending by 30 June
- The employer and government contributions over the remainder of the scheme are set out below:
|
July |
August |
September |
October |
|
|
Government contribution: employer NICs and pension contributions |
Yes |
No |
No |
No |
|
Government contribution: wages |
80% up to £2,500 |
80% up to £2,500 |
70% up to £2,187.50 |
60% up to £1,875 |
|
Employer contribution: employer NICs and pension contributions |
No |
Yes |
Yes |
Yes |
|
Employer contribution: wages |
0 |
0 |
10% up to £312.50 |
20% up to £625 |
|
Employee receives |
80% up to £2,500 per month |
80% up to £2,500 per month |
80% up to £2,500 per month |
80% up to £2,500 per month |
The guidance provides many detailed examples of how to calculate claims after 1 July considering the new rules in terms of 'usual wage', claims needing to be within the same calendar month and flexible furlough arrangements.
If you would like more information on the flexibilities offered by the scheme and how they can help to manage employee costs over the next four months, please contact your client manager or the Job Retention Team.
Self-employment Income Support Grant
Claims for the first grant must be made by 13th July 2020.
The extension to the scheme will allow self-employed individuals or members of a partnership to make a claim in August 2020. The eligibility criteria remains the same:
- you traded in the tax year 2018 to 2019 and submitted your Self-Assessment tax return on or before 23 April 2020 for that year
- you traded in the tax year 2019 to 2020
- you intend to continue to trade in the tax year 2020 to 2021
- you carry on a trade which has been adversely affected by coronavirus
The key points in relation to the extension are as follows:
- The claim has been reduced to 70% of average monthly trading profits and will be capped at £6,750 in total.
- You can claim for the second grant even if you did not make a claim for the first grant
- There is additional guidance included which highlights situations where someone may have been impacted before but not now e.g. building contractor who was not allowed on site at point of first claim but has since been allowed to recommence work may not be impacted for the purposes of the second claim.
COVID-19 Charities Fund
The fund was launched yesterday and is open for applications until Friday 10th July. It is aimed at providing assistance to charities that have unavoidable costs to cover up to 30 September that cannot be covered by existing grants or public funding and are therefore at risk of imminent collapse. An eligibility checker is available here.
Charities will be asked to provide financial information to support their application including accounts, bank statements and 2020 budget.
Brexit - Questionnaire for businesses who move goods between Great Britain and Northern Ireland
The UK Government published their Command Paper in May which outlined how they thought that the NI Protocol could be implemented. It said that there would be unfettered access for goods moving between NI and GB and that there would be limited additional process on goods arriving in NI. However, Michel Barnier said that the UK's proposal that exit declarations on goods travelling from NI to GB will not be required was "incompatible with the legal commitments accepted by the UK in the protocol".
In order to understand how many businesses will be impacted by the proposed changes, HMRC is asking businesses to complete a questionnaire to allow it to collect data on the businesses that move goods between NI and GB.
Please contact your client manager if you would like any assistance.