COVID-19 is having a massive impact on our society. The implications for businesses are enormous. Below, we have set out some guidance to help our clients through this difficult time.
The situation is changing on an hourly basis, but we are doing our best to stay on top of the main issues for our clients. Often, initiatives will be announced but actual details will be scant. Many of the initiatives, including grants, will have further information released over the coming weeks. We would suggest that clients refer back to the Government’s main resource sites on a regular basis:
The Ellis Lloyd Jones team
We have implemented a COVID-19 working plan to ensure that you continue to receive our full service. Further details can be found HERE
Budget 2020
You can find our previous guidance on the Budget and the COVID-19 measures included in it HERE
Sick pay
Legislation is to be introduced to allow small and medium-sized businesses and employers to reclaim SSP for sickness absence due to COVID-19:
> this refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19
> employers with fewer than 250 employees will be eligible – the size of an employer will be determined by the number of people they employed as of 28 February 2020
> employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19
> employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note but they should instead obtain an isolation note by visiting NHS 111 online and completing the online form. Isolation-note
> eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to those staying at home comes into force
> the government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible
We will be able to offer our payroll clients advice on these issues.
Carrying over paid holiday
The government has introduced a temporary new law to deal with Coronavirus disruption.
Employees and workers can carry over up to 4 weeks’ paid holiday over a 2-year period, if they cannot take holiday due to Coronavirus.
School closures – Parental leave guidance for employers
Read our news article regarding school closures and parental leave guidance HERE
School closures – Facilities for the children of key workers
Details of the definition of key workers can be found HERE
Staff lay-offs
Many clients may be facing the prospect of laying staff off on a short-term or permanent basis where their businesses are under particular strain. Whilst Ellis Lloyd Jones does not provide HR advice we are happy to give general advice wherever possible. Those who use our payroll service can contact the team for advice.
Should lay-offs be required you should contact your HR or employment law advisor. We work with our own selected HR advisor – some of you may already be using their service.
Some useful advice in this area is provided by ACAS. A useful guidance leaflet can be found HERE
Coronavirus Job Retention Scheme
Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis
All UK businesses are eligible.
You will need to:
> designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
> submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.
Guidance on furloughing your employees can be found HERE
Also:
Furlough – Employee information sheet
Furlough – Letter template seeking agreement
Business rates and grants
It should be noted that this can vary between Wales and England.
The Welsh Government have released new information regarding additional grants available to Welsh Businesses and the information is available HERE
Wales – See the Welsh Governments statement on support HERE
The Welsh Government has announced a package of support worth £1.4bn for small businesses to help them during the coronavirus outbreak.
Retail, leisure and hospitality businesses with a rateable value of £51,000 or less will receive 100% business rates.
Expanding on this support a new package providing in 2020/21, retail, leisure and hospitality businesses in Wales with one year business rates relief and a grant of £25,000 for retail, leisure and hospitality businesses with a rateable value of between £12,001 and £51,000.
It also provides a £10,000 grant to all businesses eligible for Small Business Rates Relief with a rateable value of £12,000 or less.
Businesses that qualify for this support will not need to do anything to apply for this scheme. This will be administered through the Business Rates system. You do not need to contact your Local Authority about this, you will receive information in due course.
Specific local authorities
You can apply for your local authority grants as follows:
Newport City Council HERE
Cardiff City Council HERE
Torfaen County Council HERE
Caerphilly County Council HERE
England
Full details of the rates exemptions and grants available in England can be found HERE
Pubs and restaurants to operate as takeaways
The Government has announced that planning regulations will be relaxed to allow pubs and restaurants to operate as takeaways. More information can be found HERE
Loan funding
A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch next week to support businesses to access bank lending and overdrafts. The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value. Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments.
You will need to access this funding through your bank.
Guidance is provided by the Bank of England HERE
If you are having cashflow problems now, or anticipate them in the near future, please do not hesitate to give us a call. We can offer advice and guidance in this area.
Mortgage holidays
Mortgage lenders have agreed they will support customers that are experiencing issues with their finances as a result of Covid-19, including through payment holidays of up to 3 months. This will give people the necessary time to recover and ensure they do not have to pay a penny towards their mortgage in the interim. This should not have an impact on the borrower’s credit rating.
Payment of tax and VAT
VAT deferral – VAT payable between now and the end of June 2020 can now be deferred until the end of the 2020/21 tax year. If you are an Ellis Lloyd Jones client we will contact you about this automatically when we prepare your next VAT return. See our guide HERE
Income Tax deferral – For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.
All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.
If you anticipate such issues, please don’t hesitate to give us a call. Alternatively, you can call HMRC directly on the following dedicated helpline: 0800 0159 559
Companies House to allow coronavirus-related filing extensions
Businesses affected by the COVID-19 pandemic can now apply to Companies House to request an extension to file their accounts, reports and confirmation statements. The rules for the granting of an extension are stringent but at least offer some support to those most affected. Further details can be found HERE
Filing extensions for charities
Any charity that needs an extension to their annual return deadline can contact the Charity Commission to ask for one. Further details can be found HERE
Off-payroll working (IR35) – rule changes delayed
Because of the COVID-19 outbreak the government has postponed the adoption of the new Off-payroll rules for one year. They will now come into force from April 2021.
CITB – Support for construction employers
CITB has issued guidance on support it can provide to employers. Details can be found HERE
Insurance – Interruption of business claims
Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim.
Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.
Mental health
A useful guide on mental health issues is provided by the Mental Health Foundation HERE
More information and guidance will be provided as it becomes available…….
We are here to help our clients wherever we can – don’t hesitate to call if you have any concerns.