Now that you’ve recovered from the initial shockwaves that the COVID-19 pandemic sent across the nation, you’re probably looking at how you can minimise the impact to your work and income over the coming months.
Since the Budget 2020, there’s been a further wave of announcements from the Chancellor. These are designed to help businesses and the self-employed manage their cash flow and protect their income.
To help you understand what support is available – and for who – we’ve broken everything down into a helpful blog.
The Coronavirus Job Retention Scheme
Employers have the option to furlough staff – including directors. So, as a contractor operating through a limited company, you are able to furlough yourself. In doing so you can claim up to 80% of your salaried income, up to a monthly limit of £2,500.
However, we are still waiting on details as to what work sole directors would be able to carry out during the period. There are various employment law issues this can bring with it and so we await the clarity needed from the government.
Support for sole traders
Self-employed workers can apply for a grant of up to 80% of their average monthly profits to help with the financial impact of coronavirus. HMRC will contact you directly to arrange this in June; the money (a maximum of £2,500 a month) will be paid in a single lump sum.
Contractors and freelancers can also receive support through Universal Credit – the Minimum Income Floor has been relaxed temporarily.
The Coronavirus Business Interruption Scheme
Small- and medium-sized businesses can also apply for government-backed loans through the Coronavirus Business Interruption Scheme. Loans are available up to £5 million, with no interest for the first six months.
The Small Business Grant Scheme
If you already benefit from small business rate relief, rural rate relief and tapered relief, you may also be entitled to a one-off grant of £10,000. This will be distributed by your local council.
Business rates holiday
Some businesses will also be eligible for a business rates holiday for 2020-21. This benefit will be automatically applied to a revised bill if you qualify.
VAT, Income Tax and Self Assessment
You also have the option of deferring VAT and Self Assessment payments. VAT payments due before 30th June 2020 will not be due until 31st March 2021. Self Assessment payments that would have been due on 31st July 2020 won’t be due until 31st March 2021. Taxpayers also have until the end of the 2020/21 tax year to pay any liabilities that are due during this period.
Time to Pay
If you’re self-employed or a small business owner, you could be eligible for support with your tax payments through HMRC’s new Time to Pay service. Cases are determined individually.
Other support available
The government have also urged loan lenders to consider the current circumstances in regard to personal loans and credit card bills. And, as we’ve already revealed, the reform to the off-payroll working rules has been delayed until 6th April 2021.
During this unprecedented time, we want you to know that we are here to support you. Whether you’ve got a general business question or are worried about your finances, you can get in touch with our experts. Simply call us on 0161 669 4221, email info@biaccountancy.com or fill in our online contact form.
