We have now prepared an update guidance note for the Job Retention Scheme click this link here:  JRS 27th March 2020

All queries should be directed to your normal office contact or to our task force on JRS@MILNECRAIG.CO.UK

Please note, directors of “one person” companies appear to be included to the extend of their salaries.  We have some caution as to whether this is practical for directors of small businesses as the furlough requires a directors to perform no employment duties (save for officer’s duties).

As before, our priority is for the physical and financial well-being of staff, clients and those closest to us all.

Regards
Donald Parbrook

Director

Please see the link below for our guidance on the financial support for the self-employed/partners in a partnership.

If you have questions about the scheme, either contact your normal relationship manager here, or email Karen Morrison and the team working on helping with claims here:

selfemployedsupport@milnecraig.co.uk

Link to Guidance here: Covid: Support for Self Employed

Please note, for enquiries about how the Coronavirus Job Retention Scheme (for Employed persons) works and how we can help you contact your usual relationship manager or you can email Irene Milligan, Wilma McIntyre and that team working on helping clients Furlough staff and submit claims once the portal is ready here:

jrs@milnecraig.co.uk

We are currently updating our guidance on the Job Retention Scheme following the release of HMRC’s official guidance on this.  Links to HMRC’s guidance can be found here:

https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-guidance-for-employees

More news and bulletins will be posted on the news section of our website.

Thanks

The Directors, Milne Craig

Dear All

Update at 27th March 2020.

THE SELF EMPLOYED – GRANTS FOR PARTNERS AND SOLE TRADERS

The Chancellor announced substantial help for the self employed last night.  Those with taxable profits under £50,000 look set to receive a grant.  We are currently digesting the announcement with a view to reviewing which clients are eligible to ensure HMRC’s commitment to contact those eligible is honoured.  It will be June before this scheme is up and running, as HMRC are giving priority to the Job Retention Scheme for employed workers.  If you have urgent enquiries contact your usual Milne Craig relationship manager and we will ensure your affairs are reviewed over the coming week.  This only applies to the self employed, not those trading via Limited Companies (who are possibly eligible under the “JRS”).  HMRC guidance is here, but we’ll be adding our own summary later today:-

https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

JOB RETENTION SCHEME – MORE DETAIL RELEASED OVERNIGHT

We are working our way through the guidance.  We have a task force preparing a new summary of the rules at this time and we will contact the many clients who have expressed interest urgently with the information needed to prepare their claim as soon as the HMRC online portal is up and running (it is NOT yet operational).  There will be an update available early next week.  We are acutely aware that some clients are making urgent decisions to designate workers as “furloughed”.  In many ways this is as much an issue of employment law as it is about the funding.  We have a couple of styles of letter that have been released without charge by employment specialists.  Those making decisions today, might consider taking time to read the three available pages of HMRC guidance as these provide as good a starting point as any for the matter.  If you are interested in this area please email jrs@milnecraig.co.uk as the task force here will then include you in our updates and provide details of the claim process and information we need to help.

https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-guidance-for-employees

Note – we anticipate more HMRC/Government information on company directors and “one person” type companies today.

SUMMARY

These announcements are welcome.  The team here are acutely aware there is a huge volume of interest in the Job Retention Scheme.  Our priority is to get those using the Scheme the right advice on the process (albeit we are not Employment law experts) and to ensure claims can then be made quickly.  We will prioritise those clients most obviously needing the help quickly.

We will be writing more on this today and publishing that too.  If you are a client of our firm wanting to know more and perhaps make a claim, please register your interest in the “JRS” by emailing jrs@milnecraig.co.uk if you have not already done so.

Once again, our primary focus is the well being of our staff, of clients and family and friends.  We thank those most directly exposed to risk within the NHS and we recognise the additional anxiety and social difficulty this is causing us all.

Regards

The Directors

Milne Craig

The long-awaited statement from the Chancellor, Rishi Sunak regarding COVID-19 support for the self-employed has been announced. The Chancellor said that the scheme will benefit some 95% of people whose main income source is derived from self-employment.

A list of the scheme features as announced, and published, are as follows:

• Those that qualify will receive a cash grant from HMRC based on 80% of profits, up to £2,500 per month,
• The initial grant will be for the three months, from 1 March through to the end of May 2020, but could be extended for a longer period.

To be eligible, the following conditions will be taken into account:

• Applicants must be self-employed or a member of a trading partnership,
• Have lost trading profits due to COVID-19,
• Have filed a tax return for 2018-19. Late filers will have four weeks from 26 March 2020 to do so,
• Have traded in 2019-20; be currently trading at the point of application (or would be except for COVID-19) and intend to continue to trade in the tax year 2020-21,
• Have trading profits of less than £50,000 and more than half of total income from self-employment. This can be with reference to at least one of the following conditions:
  • Your trading profits and total income in 2018-19,
  • Your average trading profits and total income across up to the three years between 2016-17, 2017-18, and 2018-19.

There is no need to apply to HMRC as they will contact you if you are eligible. HMRC will use existing data to make this judgement. The initial three-month grant will be paid directly to a nominated bank account in a single lump sum. The grants are expected to be paid out at the beginning of June. The reason for this delay is likely down to three main factors: the 4 weeks additional filing time for late filers, the requirement to set up a complex new system at the same time as the Coronavirus Job Retention Scheme and to reduce the risk of fraud.

It is assumed that those self-employed who have experienced a significant drop in income due to COVID-19 disruption will need to apply for Universal Credits or Business Continuity Loans to tide them over until June. This will be a challenging time for those affected as the demand for help will place significant challenges on the institutions charged with providing this support.

CORONAVIRUS JOB RETENTION SCHEME (CJRS) – update for director shareholders

There has been uncertainty as to the position of director/shareholders claiming under the CJRS as their income is usually taken from their company as a combination of a low salary and dividends. In the news story published following the Chancellor’s statement on 26 March (regarding the Self-employed scheme) is a telling paragraph. It says:

Those who pay themselves a salary and dividends through their own company are not covered by the scheme (the Self-employed Scheme) but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.

This infers that directors will only be eligible for the CJRS based on their salary alone, and only if there is a proven PAYE record.

Further details of the CJRS are due to be published imminently and will be added to our newsfeed as soon as they are available.

Further support to businesses and the self-employed, to delay the payment of various taxes was announced last week. They include:

VAT

Any VAT that falls due for payment in the period from 20 March 2020 to 30 June 2020 can be deferred until the end of the 2020-21 tax year.

This is not a cancellation of any liability that falls due in this period, merely a deferral. Businesses will need to ensure that they have funds to settle any arrears on or before the end of March 2021 (5 April 2021).

Any refunds due from HMRC will be paid as usual.

Second payment on account due 31 July 2020

It has been confirmed that self-employed persons’ self-assessment, second payment on account for 2019-20, due 31 July 2020, can be deferred until 31 January 2021.

Tax payers should be aware that as with the VAT offer, this is a deferral, not a cancellation of tax due. Those who take advantage will need to pay their second payment on account and any balancing payment for 2019-20 and any first payment on account – if any is due – for 2020-21.

Please call if you need to clarify which VAT payments can be deferred and the likely longer term cash flow effects if you defer the self-assessment payment on account in July.

In both cases there is no need to apply to HMRC to defer payments.