ANNUAL LEAVE RULES RELAXED TO ALLOW IT TO BE TAKEN OVER A 2 YEAR CYCLE

Statutory annual leave entitlement has been amended to enable workers, who cannot take leave due to Covid-19, to carry this over into the next 2 leave years.

At present most employees are entitled to 28 days’ holiday, including bank holidays, per year (pro rata for part time).  The rules state that most are not able to carry any over to the next year, if not taken and therefore lose that holiday entitlement.

The obligation is on the employer to ensure that all employees take said statutory entitlement during the year with financial penalties if not.

The Government have announced that these regulations are to be relaxed with up to 4 weeks of holiday entitlement, not taken, to be carried over into the next 2 leave years.  It thereby eases the requirements for employers,

• ensuring that the whole holiday entitlement does not need to be taken in one year.
• those particularly affected by Covid-19 have the flexibility to allow employees to carry over holiday and thereby not leaving them short staffed at a future date when all annual leave needs to be taken by.

These changes will amend the Working Time Regulations which covers the majority of workers such as agency workers, those who work irregular house and workers on zero-hours contracts.

There is always an obligation on the employer to ensure that employees have sufficient opportunity to take holiday and it cannot be replaced with payment in lieu.

The exception to this is when the employee leaves.  If the latter arises, regulations have been amended further to take account of this.  Any holiday pay due will also incorporate any carried over and not taken due to Covid-19 and will be paid accordingly.

Source: Accountancy Daily

Photo by Link Hoang on Unsplash

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBRR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

You are eligible if:

• your business is based in England
• you are a business that occupies property
• you are receiving small business rate relief or rural rate relief as of 11 March 2020

If you are or believe you are eligible for this grant from the Government, you can speed things up by completing the online form

https://forms.leeds.gov.uk/SmallBusinessGrants/

https://forms.wakefield.gov.uk/Forms/BusinessGrant/BusinessGrantForm.aspx

https://www.doncaster.gov.uk/doitonline/request-a-small-business-grant-fund-and-retail-hospitality-and-leisure-grant-fund-payment

https://www.northyorks.gov.uk/coronavirus-covid-19-business-support

If your council is not listed above, you can search @small business grant to see if there is a form available to complete yet.

If you need help then please call on  0113 2864486

The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) who have lost income due to coronavirus (COVID-19).  The scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.

 Who can apply?

 You can apply if you’re a self-employed individual or a member of a partnership and you

• have submitted your Income Tax Self Assessment tax return for the tax year 2018-19
• traded in the tax year 2019-20
• are trading when you apply, or would be except for COVID-19
• intend to continue to trade in the tax year 2020-21
• have lost trading/partnership trading profits due to COVID-19

Your self-employed trading profits must also be less than £50,000 and more than half of your income comes from self-employment. This is determined by at least one of the following conditions being true:

• having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
• having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period

If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way.

How much will you get?

You’ll get a taxable grant which will be 80% of the average profits from the tax years (where applicable):

• 2016 to 2017
• 2017 to 2018
• 2018 to 2019

To work out the average HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 3 (where applicable), and use this to calculate a monthly amount.  It will be up to a maximum of £2,500 per month for 3 months.  They will pay the grant directly into your bank account, in one instalment.

How to apply

You cannot apply for this scheme yet.  HMRC will contact you if you are eligible for the scheme and invite you to apply online.  Individuals do not need to contact HMRC now and doing so will only delay the urgent work being undertaken to introduce the scheme.

You will access this scheme only through GOV.UK. If someone texts, calls or emails claiming to be from HMRC, saying that you can claim financial help or are owed a tax refund, and asks you to click on a link or to give information such as your name, credit card or bank details, it is a scam.

After you’ve applied

Once HMRC has received your claim and you are eligible for the grant, they will contact you to tell you how much you will get and the payment details.

If you claim tax credits you’ll need to include the grant in your claim as income.

Directors

 If you are a director of your own company and paid through PAYE it has been suggested that you may be able to get support using the Job Retention Scheme

If you need assistance then please call us on 0113 286 4486.

Photo by Medienstürmer on Unsplash

The Government has made many announcements to assist businesses through the present COVID-19 situation.

Deferment of VAT payments

• VAT payments can be deferred for up to 3 months.
• All UK businesses will be eligible and the scheme will run between 20 March 2020 and 30 June 2020.
• There is no need to apply for this scheme.
• Businesses will be given until the end of 2020/2021 to settle outstanding VAT liabilities that have accumulated as a result of the 3-month deferral.

Time to Pay

• Any business that pays tax to the UK Government and has outstanding tax liabilities will be able to apply for their case to be reviewed by HMRC with a view to arranging a bespoke “time to pay” agreement
• This applies to all business including the self-employed.
• HMRC has set up a dedicated helpline: 08000159559

Business Rates

• HMRC will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020/2021 tax year.
• No action is required and this will apply to your next council tax bill in April 2020 meaning that there would be no rates payable for those businesses for 2020/2021.

Cash Grants

• Cash grants are only currently available to businesses who pay rates.
• The retail, hospitality and leisure sectors in England can also apply for a cash grant of up to £25,000 per property.
• For rateable values of under £15,000, they will receive £10,000. Between £15,001 and £51,000, they will receive a grant of £25,000.
• No action is required as local authorities will write to eligible businesses.
• Smaller businesses within the Small Business Rate Relief or Rural Rate Relief will be able to apply for a one-off grant of £10,000.

Business Interruption Loan Scheme

• The British Business Bank will launch a scheme from the w/c 23 March 2020 to support businesses with a turnover of no more than £45 million per year.
• The government will provide lenders with a guarantee of 80% on each loan.
• This applies to loans of up to £5m.
• No interest will be charged for the first 12 months.

Companies House

• If a company’s accounts are unlikely to be filed on time owing to being affected by Coronavirus, then an application can be made to extend the period allowed for filing. Here is a link.
• If an application is not made and there is a late filing, then the normal penalty regime would apply.
• It is important to make the application ahead of the deadline.

If you need assistance, then please call us on 0113 286 4486

With the ever changing situation with regards to COVID-19 and how this effects businesses if you have employees, we have detailed below what the Coronavirus Job Retention Scheme involves and the present position on Statutory Sick Pay.

Coronavirus Job Retention Scheme

HMRC will set up a new online portal so that ALL UK employers, regardless of size, will be eligible for assistance where an employee has been designated as a ‘furloughed worker.’ HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.  The current plan is that this will be in place for 3 months, at which point it will be reviewed.  This will be backdated to 1 March 2020.

Employers must set out which of their employees are ‘furloughed workers’ and inform particular employees.

Furlough is the equivalent of lay off. So, you can lay off staff, continue to pay them and recover 80% of that cost up to £30k per annum.

The current guidance states ‘You will remain employed while furloughed. Your employer could choose to fund the differences between this payment and your salary, but does not have to.’

Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation. Our HR support line can help (0844 892 2807).

Questions we have been asked, and our answers, given the current information (23^rd March 2020)

1. Can an employee still work if they are Furloughed?

• No, it is classed as being laid off.

2. My employees received a pay rise in March, will I be able to recover 80% of this higher rate, or will the rate of pay be that as at 28^th Feb?

• We are awaiting clarification of the details.

Statutory Sick Pay (SSP)

Employers will be able to reclaim up to 2 weeks of SSP payments per employee where those SSP payments related to Coronavirus. This applies to all UK employers with 250 employees or less as at 28 February 2020.

The reclaim will not be via RTI, instead, HMRC will set up a new portal to facilitate this.

Please call us on 01132864486 if you need assistance.

National Insurance Contributions

Both the employed, and the self-employed who pay Class 4 contributions, will be able to earn up to £9,500 in 2020/21 before NICs announced the Budget of 2020.

If you employer a veteran, then a new National insurance “holiday” is being introduced for the first year of civilian employment.

National Insurance rates for 2020/21 are remaining the same.

Employed 2019/20                                                                       Employed 2020/21

How much you earn       Class 1 rate                                         How much you earn       Class 1 rate

Less than £8,632                0%                                                      Less than £9,500                 0%

£8,632 – £50,000             12%                                                       £9,500 – £50,000               12%

More than £50,000            2%                                                        More than £50,000              2%

Self Employed 2019/20                                                               Self Employed 2020/21

How much you earn       Class 2 & 4 rates                               How much you earn       Class 2 & 4 rates

Less than £6,365               0%                                                      Less than £6,475               0%

£6,365 – £8,632                 £3 per wk (Class 2)                           £6,475 – £9,500                 £3.05 per wk

£8,632 – £50,000               9% + £3 per wk                                 £9,500 – £50,000               9% + £3.05 per wk

More than £50,000            2% + £3 per wk                                  More than £50,000           2% + £3.05 per wk

 Employment Allowance Scheme

The Employment Allowance scheme (introduced in 2014) was to allow certain businesses who employ staff to reduce their National Insurance Class 1 bill by £3,000 and claimed via payroll.

From 6 April 2020 the Employers Allowance will increase to £4,000 but will only be available to smaller businesses with an employer’s NI bill of £100,000 or less in the previous tax year.

If your business is part of a group of companies or has related companies under the same control, only one company in the group can claim the allowance.

Source: Which & boox

The Advisory Fuel Rates (AFR) as of 1 March,

Engine size                                         Petrol – amount per mile                             LPG – amount per mile

1400cc or less                                     12 pence                                                          8 pence

1401cc to 2000cc                                14 pence                                                        10 pence

Over 2000cc                                        20 pence                                                        14 pence

Engine size                                         Diesel – amount per mile

1600cc or less                                      9 pence

1601cc to 2000cc                               11 pence

Over 2000cc                                       13 pence

Hybrid cars are treated as either petrol or diesel cars for this purpose.

The Advisory Electric Rate (AER) which was introduced in September for 100% electric cars will remain the same at 4p per mile.  Electricity is not a fuel for car fuel benefit purposes.

The AFR and AER are deemed to be tax and National Insurance free.

Both rates can be applied for fuel per mile,

• to reimburse employees for business travel in their company cars.
• when you require employees to repay the cost of fuel used for private travel.

If your employee does not repay the private fuel used during the tax year then you will need to,

• report on their P11D
• pay Class 1A National Insurance on the value of the fuel benefit

If you travel as a result of running your business (other than home to work) and

• are unsure on what you can claim
• are considering your options regarding the company purchasing a vehicle
• want to understand the rules around company car benefits in kind
• or anything else associated with business travel

Please contact us so that we can ensure the advice you are given is specific to your circumstances on 0113 2864486

Source: HMRC

Photo: Photo by Juan Fernandez on Unsplash

A sensitive subject but one that has been looked at by the Government and is due to come in from April 2020.

The Parental Bereavement (Leave and Pay) Act 2018 requires Regulations to be put in place so that parents who suffer the death of a child, will have a day one right to request leave.

Parental Bereavement Leave (PBL)

PBL will come in line with other statutory family leave; a day one right for qualifying employees if they experience the death of a child, or children, from 24 weeks gestation to 18 years.  There will be a maximum of 2 weeks that can be taken either in one go or 2 separate periods of a week.

Statutory Parental Bereavement Pay (SPBP)

The statutory pay jargon:

• “Relevant Week” – the week that ends on a Saturday, before the week in which the child dies.
• “Relevant Period” – a period of 8 weeks ending with the relevant week.

SPBP can be claimed for a death that occurs after 6 April 2020.

Leave with payment of SPBP must be taken with 56 weeks of the date of death and it is entirely up to the employee if they take some, all or none of the leave allowed.  56 weeks is to take into consideration that parents may wish time away from work both near the time of the death but also the time around the anniversary of the death.

If any employee changes employment within the 56 weeks they will still be entitled to receive SPBP in their new employment if they met all conditions at the relevant week.

If an employee is entitled to SPBP due to the death of more than one child, then the leave entitlement is 2 weeks for each child.

There are conditions that do apply if the employee is receiving Statutory Sick Pay (SSP) during any part of the week when SPBP is payable and Statutory Maternity Leave (SMP), Statutory Adoption Pay (SAP) etc.

There are qualifying conditions to receive SPBP being,

• Length of service and earnings
• Employee’s relationship with the child

For further details on this can be found by clicking the link or if you require any assistance with your payroll in this matter then please get in touch on 0113 286 4486.

Source: Accounting Web

Photo by Roman Kraft on Unsplash

With the deadline for completing your Self Assessment having passed, not everyone filed on time. If you are one of these then you will have incurred an immediate fine of £100.

HMRC have revealed that 958,296 taxpayers (8.18% of the returns due) who were due to file their tax return have not done so.  A slightly better figure than 2019 which just topped 1 million.

702,171 left it until the last day, with the peak time when people were submitting was between 4pm and 4.59pm when 56,969 returns were submitted.  26,562 were filed between 11pm and 11.59pm, leaving it rather late but still on time.

At the beginning of the year HMRC stated that 5 million need to be submitted with 3 million still needing submission in the last week.

HMRC were pleased that more than 10.4 million taxpayers chose to file online, which accounted for 93.95% of the total filed.

If you still need to submit your Self-Assessment, plus need to pay any taxes due, then it is important that you do so as soon as possible so that £100 fine mentioned above does to increase further.  You have 3 months i.e 1^st May before additional charges are incurred but after this date it is a daily charge and these increase with time.  Our blog of last year highlights in more detail what these charges are.

You can appeal against some penalties, but you need to have a reasonable excuse such as,

• partner or close relative passed away shortly before the tax return or payment deadline
• no payments were required
• an unexpected stay in hospital
• delays related to a disability you have etc.

Excuses that have not been accepted over the previous decade are,

• my hamster ate my post
• a DJ was too busy with a party lifestyle – spinning the decks….in a bowls club
• my mother in law was a witch and put a curse on me
• I was up a mountain in Wales, and couldn’t find a post box or get an internet signal

If you need help with still submitting your Self Assessment then contact us on 0113 286 4486.

Source: Accounting Web, GOV.UK & GOV.UK

Recent news articles have reported that the government is to increase the national living wage from April 2020. Rises are set to be between 4.9% and 6.5%.

For those over 25 it will be a rise of more than four times the rate of inflation, taking the hourly rate to £8.72.

However, businesses have warned that such increases will put pressure on company costs.  Hannah Essex, co-executive director of the British Chamber of Commerce has said many companies “have struggled with increased costs in a time of great economic uncertainty.  Raising wage floors……will pile further pressure on cash flow and eat into training and investment budgets.  For this policy to be sustainable, government must offset these costs by reducing others.”

The new National Living Wage rates from April 2020 are:

• for ages 25 and above – up 6.2% to £8.72
• for ages 21 to 24 years old – up 6.5% to £8.20
• for those 18 to 20 years old – up 4.9% to £6.45
• for those under 18’s – up 4.6% to £4.55
• for apprentices – up 6.4% to £4.15

The Federation of Small Business (FSB) has stated that “an increase of this magnitude” could lead to reduced recruitment, cancelled investment plans or even redundancies.  Craig Beaumont, FSB director of external affairs and advocacy has said that, with the increase in business rates of 1.7% in April, small businesses will need support.

An independent report has noted that there is little, or no evidence of jobs been lost due to the minimum wages rises over the years.   Professor Arindrajit Dube, a US academic and expert on this subject said there was “room for exploring a more ambitious national living wage” in the UK over the coming years.

He did also state that there is relatively little evidence available and that the Low Pay Commission would be able to review the effect on jobs as wages increased.

The government announced in September of last year, that it will go ahead with the Low Pay Commission’s recommendations that by 2024 the over 21’s will receive the higher national living wage rate.  It is set to be £10.50 by this date.

If you need help with payroll then call us on 0113 2864486

Source: BBC News

Photo by Fabian Blank on Unsplash