With the ongoing coronavirus pandemic these are extremely uncertain and unprecedented circumstances for the business community in Northern Ireland. A number of measures have been announced to provide support to businesses and further announcements and clarifications are expected over the coming days and weeks.
The key measures and announcements that have been revealed as of 26 March 2020 are:
Self-Employment Support Scheme
On 26 March 2020 the government announced this scheme to support those who are self-employed or members of a partnership and have lost income due to coronavirus.
To avail of this support you must:
In addition, you must satisfy one of the following conditions:
If you commenced trading in the period 2016-19, only those years for which you filed a Self-Assessment tax return will be used to determine your income levels.
If you have not submitted your income tax return for the 2018-19 tax year you must do so by 23 April 2020 to remain eligible.
HMRC will identify those who are eligible for this scheme based on data submitted on 2018-19 income tax returns.
Amount of Support Available
The amount of support that is available is a grant of 80% of your average profits from the previous three tax years (or the average from commencement of trade where trading commenced in the period 2016-19).
The average profits will be used to calculate a monthly amount.
The grant will be up to a maximum of £2,500 per month for three months and will be paid directly in one instalment.
The grant is taxable.
What to do Now
HMRC will contact you if you are eligible for the scheme and invite you to apply online.
If you are eligible, after HMRC receives your claim they will contact you to tell you how much you will get and the payment details.
Please note - you will access this scheme only through GOV.UK. Be aware of any scams.
The minimum income floor for self-employed has been suspended meaning that self-employed can access Universal Credit at a rate equivalent to Statutory Sick Pay for employees.
Self-assessment payments due on 31 July 2020 have been deferred until 31 January 2021. No interest or penalties will be charged in the deferral period.
Under this scheme employers will be able to access support to continue paying part of the salary of those employees that they would otherwise have to layoff due to the crisis.
Employers will have to designate affected employees as ‘furloughed workers,’ and notify the employees of this change. It should be borne in mind that changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.
A new portal is being developed by HMRC through which information about furloughed employees will be submitted.
HMRC will reimburse 80% of the relevant workers’ wage costs, up to a cap of £2,500 per month. They are currently working to set up a system for reimbursement as existing systems are not set up to facilitate payments to employers.
The Job Retention Scheme is open to all employers in the United Kingdom and will cover the cost of wages back dated to 1 March 2020. The scheme will be open before the end of April and will be open for at least 3 months.
The nature of this scheme is such that the employer must still make the payments to employees and subsequently claim the reimbursements from HMRC. This will have cash flow implications for many businesses who may require additional support through the Business Interruption Loan Scheme, which is explained in more detail below.
The Chancellor has stated that there is no limit on the funding available and the government will support as many jobs as needed.
Businesses will not need to make any VAT payments in the period 20 March 2020 to 30 June 2020, with payment of VAT falling due during the period not required until 5 April 2021.
Businesses must continue to submit their VAT returns by the due date as normal. Those businesses that normally pay their VAT liability by direct debit and are unable to pay their VAT liability, should cancel the VAT direct debit with their bank in sufficient time so that HMRC does not attempt to automatically collect the payment following submission of the VAT return.
Refunds and reclaims will be paid by HMRC as normal.
On 18 March 2020 the Northern Ireland Executive announced that £370m is being provided to help the most vulnerable businesses in Northern Ireland during the pandemic.
Small businesses with a Net Annual Value (i.e. rateable value) of up to £15,000 will receive a grant of £10,000 and larger, medium-sized firms in the retail, tourism and hospitality sectors will receive a grant of £25,000.
Businesses must have a rateable value of between £15,000 and £51,000 to qualify for the £25,000 grant.
Registration is now open for businesses to apply for the £10,000 Small Business Grant Scheme.
Automatic payments will be made to those eligible businesses whose bank account details are held for the purposes of paying rates by Direct Debit. The first payment in the Small Business Support Grant Scheme will be made on 31 March if not before.
Eligible businesses that don't currently pay business rates by Direct Debit can register for the scheme and provide their bank details by completing an online registration form at:
Business with multiple premises will only be eligible for one grant of £10,000 in total and vacant properties are not eligible.
Grant payments are not being automatically issued to landlords of properties with a rateable value of £1,590 or less. Arrangements are being put in place to contact the landlord and small businesses concerned.
Additional processes are underway for the £25,000 grant for the hospitality, tourism and retail sectors.
Statutory Sick Pay Rebate for SMEs
Employers will be able to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
The key points are:
To be eligible for the scheme a business must be based in the United Kingdom, it must be classed as small or medium sized, and it must have had fewer than 250 employees on 28 February 2020.
A rebate scheme is currently being developed and further details will be provided in due course.
The Coronavirus Business Interruption Loan Scheme went live on 23 March 2020 and is initially expected to remain open for six months.
A number of lenders have already registered to provide access this scheme, including most of the main Northern Ireland banks.
Applications should be made as early as possible through your bank or finance provider and a business plan will be required, so please speak to us to assist with this.
Full details, including a list of the lenders that have registered for the scheme, are available at:
Rates holiday for businesses
There will be a three month rates holiday for most business ratepayers; public sector and utilities are excluded. The effect of this is that no rates will be charged for April, May and June 2020. This will be shown as a 25 per cent discount on the annual rate bill for business ratepayers.
From 25 March 2020 companies will be able to apply for a three month extension for filing their accounts with Companies House.
The extension is not automatic so companies must apply before their existing filing deadline.
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.
HMRC have setup a dedicated helpline on 0800 024 1222 for any businesses concerned about their ability to pay their tax due to Covid-19.
GMcG remains open for business and we will endeavour to support your business in whatever way we can through this difficult and uncertain time.
To discuss how the measures that the government has introduced apply to your business and how we can help you to access support please get in touch with your usual GMcG contact.
This is a rapidly evolving situation and further announcements are expected on a daily basis so we will make every effort to keep this information up to date.