Previously, business owners could only claim for cash for furloughing workers who were employed on or before 28th February 2020.
But in an announcement yesterday, (15th April) the government made revisions. It means that those who were in employment by companies on or before 19th March 2020 will be eligible for the job retention scheme.
The scheme works by allowing businesses forced to close or that have lost business to keep staff on their payroll.
Those employees are then on furlough, meaning they cannot do any work for the business.
Companies pay their staff and can claim 80% of the wage of an employee from the government, up to £2,500 per month.
Businesses may choose to only pay 80% of salaries or they can top these up so that employees receive 100% of salaries.
Employees made redundant or who stopped working for your company before 19th March 2020 qualify for the scheme if re-employed and put on furlough.
Making a Coronavirus Job Retention Scheme claim
The government plans to launch the claims service launches on Monday (20th April).
As you prepare your claim, remember:
- The launch date is Monday and you cannot access it before that. You will need to visit https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme from that day.
- You can only claim online. The service will also help you calculate the amount you can claim.
- Claims can be made by business owners even if you use an agent, i.e. your accountant.
What you need before making a claim
You need a Government Gateway ID and password. If you don’t have one, request one here. https://www.gov.uk/log-in-register-hmrc-online-services/register
Also, you need to be enrolled for PAYE online. If not registered, again you can do that here: https://www.gov.uk/paye-online
The following information is needed for each employee you are claiming for:
- National insurance number
- Claim period and amount
- PAYE/employee number
If not claiming yourself, you can ask your agents if they are authorised to act for you on PAYE matters. If you are a client, then contact us if you need our help.
Let your agent know which UK bank account the grant will be paid into.
And make sure you keep all records and calculations regarding your claims.
Self-Employment Income Support Scheme
HMRC has also issued guidance about how the Self-Employment Income Support Scheme will work.
They will use figures from your tax returns for your total trading income, or turnover, then deduct allowable business expenses and capital expenditure.
Among the allowable expenses are office costs, travel, costs, training costs related to your business and advertising and marketing.
A full range of examples have been drawn up by HMRC and are available here: https://www.gov.uk/guidance/how-hmrc-works-out-total-income-and-trading-profits-for-the-self-employment-income-support-scheme
VAT deferral due to coronavirus
Business registered for VAT and have a payment due between 20 March 2020 and 30 June 2020 can defer their payments.
However, we recommend that if you can afford to pay then do so.
If payment will lead to hardship, such as being unable to pay staff, then you can defer the payment without penalty or interest charges. Remember, you still need to submit your VAT returns on time!
Anyone choosing to defer payment does not need to tell HMRC. But remember it must be paid on or before 31st March 2021.
If you pay by Direct Debit, cancel it as soon as you to ensure payments are not taken.