Covid-19 Business Update 2 – Monday 23rd March 2020

Please find below a summary of the key support measures and other notable changes which have been released via

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.

HMRC will reimburse 80% of furloughed workers (workers put on temporary leave from work that is not paid and is often for a set period of time) wage costs, up to a cap of £2,500 per month.

HMRC do not have a system set up to make payments yet but are working urgently to do this.

How to access the scheme

You will need to:

1. 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.

2. 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).

Interruption Loan Scheme

Full details of the lenders and how to access/apply for the scheme are due imminently.

Businesses can access the first 12 months (previously 6 months) of that finance interest free, as the government has now agreed to cover the first 12 months of interest payments.

VAT Payments

HMRC will support all UK businesses by deferring Value Added Tax (VAT) payments for 3 months.

This deferral will apply from 20 March 2020 until 30 June 2020.

This is an automatic offer with no applications required.

Businesses will not need to make a VAT payment during this period, but will still be required to submit their VAT returns online.

Taxpayers will be given until the 5th April 2021 to pay any liabilities that have accumulated during the deferral period.

VAT refunds and reclaims will be paid by the government as normal.

Income Tax

If you’re self-employed, Income Tax payments due on 31 July 2020 under the Self-Assessment system will be deferred to January 2021.

This is an automatic offer with no applications required.

No penalties or interest for late payment will be charged in the deferral period.

Return to our Dedicated Page for Covid-19 Client Updates