This week the Prime Minister Boris Johnson has announced a three-tier plan to tackle the Covid-19 pandemic. Also, the self-employed businesses have until Monday to apply for the government’s grant scheme. Here is an at a glance look at the news you need to know:
Self-employed businesses have until Monday to claim financial aid from the Self Employed Income Support Scheme (SEISS). Companies can claim taxable grants of up to £6,750 under the scheme, which expires next week.
SEISS was launched in mid-August and provides financial support to the self-employed in the form of a grant of up to 70% of average trading profit for three months (capped at £6,750). A total of £7.8 billion was paid to more than 2.7 million people under the first round of grants, before a second batch was released in August.
The grant is paid in a single instalment which covers three months’ worth of profits a business would have made. Companies can make a claim for the second grant even if they didn’t do so for the first one.
To be eligible, claimants must prove they have been adversely affected by Covid-19 on or after July 14, 2020. You also need to have traded in the 2019/20 tax year and intend to continue trading during the 2020/21 tax year; your trading profits must be no more than £50,000; and you must have submitted a self-assessment tax return on or before April 23, 2020 for that year.
Prime Minister Boris Prime Minister Boris Johnson has announced a new three-tier plan for tackling the Covid-19 pandemic in England. The new system places different areas in England into three tiers depending on the severity of the outbreak and will have significant implications for small businesses. Areas with more cases will face further rules.
The new rules come into effect 14 October 2010, with places with a high number of cases such as Liverpool and surrounding areas facing the toughest restrictions in order to reduce the risk of infection. Residents there won’t be allowed to mix with anyone from another household indoors or outdoors.
Leisure centres, pubs and bars have also been told to close in the region, however restaurants can stay open for now.
The aim of the new three-tier system is to simplify the rules for local lockdowns and to avoid another national lockdown. The system will classify regions as being at a medium, high or very high level of alert:
In addition to the Medium restrictions:
The areas placed in Tier 3 can have different restrictions included below so governments suggest your review the specific rules in your area.
In addition to the High restrictions:
Depending on the area, many businesses that fall under the following categories may be forced to close:
From the 17th of October, more than half of England’s population will be under Tier 2 or Tier 3 category. According the the BBC article, the areas moving to Tier 2 will be:
With the government once again forcing many businesses to close by law, they announced the expansion of the Job Support Scheme to help affected businesses and an increase in the amount of cash grants available.
Cash grant required to close due to local lockdowns with the amount eligible dependent on the rateable value of the property:
Full details regarding the grant can be found here.
From the 1st of November, 67% of staff wages up to £2,100. Businesses will only be eligible if they are subject to restrictions and employees must be off work for at least 7 consecutive days.
Full details regarding the Job Support Scheme can be found here.
MORE than 250 small companies across Hambleton, North Yorkshire have joined the Federation of Small Businesses (FSB) thanks to council funding. Hambleton District Council has so far helped 270 small business owners to sign up to the FSB, which provides a range of vital services including a legal helpline and networking opportunities.
The district council provided £50 towards the cost of membership, while the FSB has also waived the joining fee. Hambleton District Council was the first local authority to join forces with the FSB five-years-ago, securing a funding package that enabled 300 new members from Hambleton to join the discounted scheme in five years.
HM Revenue and Customs (HMRC) has received more than 54,800 tax relief claims from people working from home through its new online portal. Launched on October 1, the portal has been set up to process tax relief on additional expenses for staff who have been told to work from home by their employer to help stop the spread of Covid-19.
From early April, employers have been able to pay employees up to £6 a week tax-free to cover additional costs if they have had to work from home. Workers who have not received the working from home expenses payment direct from their employer can apply to receive the tax relief from HMRC.
Eligible taxpayers can claim tax relief based on the rate at which they pay tax. For example, if an employed worker pays the 20% basic rate of tax and claims tax relief on £6 a week, they would receive £1.20 a week in tax relief (20% of £6 a week) towards the cost of their household bills.
Higher rate taxpayers would therefore receive £2.40 a week (40% of £6 a week). Over the course of the year, this could mean taxpayers can reduce the tax they pay by £62.40 or £124.80 respectively.
You can check if you are eligible here.
A further 219 grants totaling £1.2m have been made to SMEs by South Gloucestershire Council. The grants, which were issued under the Government’s Discretionary Small Business Support Grants programme, are aimed at helping local companies respond to the Covid-19 crisis.
In this final round of grants for small businesses, the council allowed those working from home to apply. The council has now allocated almost £40m to retailers and hospitality and leisure businesses.
HM Revenue and Customs (HMRC) has sent out thousands of letters to people who have claimed coronavirus support grants to check if they were eligible to receive them. Almost 24,000 letters have been sent to those who received self-employment support grants, querying whether they had been trading during the financial year 2018-19 or 2019-20 and who planned to continue doing so.
The letters were sent to people who had told HMRC that, at some point, they had stopped trading, and so would only be eligible if they had restarted.
Nearly 2.7 million people, whose businesses had been affected by Covid-19, claimed grants under the Self Employed Income Support. The first grant was worth 80% of profits up to a cap of £2,500 per month and the second covered 70% of profits, up to a cap of £2,190 per month.
Retailers could soon be able to issue cashback without the shopper needing to buy anything under new government proposals. It is the government’s latest move to help the millions of people who rely on cash such as the elderly and vulnerable.
Many people find that cash is more accessible than digital payments methods or that it helps them to budget and manage their finances better. These proposals also include making the Financial Conduct Authority responsible for ensuring the cash system benefits consumers and SMEs.
To ensure no one is left behind by the transition to digital payments, the government announced at the March 2020 Budget that it would legislate to protect access to cash and ensure that the UK’s cash infrastructure is sustainable in the long-term. Now it is seeking views on its approach from consumer organisations, businesses, financial institutions, and providers of ATM and payment services through a call for evidence.
One proposal under consideration is cashback without a purchase, which could help to keep cash widely available by reducing cash infrastructure costs. When local shops accept and dispense cash, it goes back into local communities and there is less need to distribute notes and coins via cash centres, thus reducing associated costs.
Last year, consumers received £3.8bn of cashback when paying for items at a till – making it the second most used method for withdrawing cash in the UK behind ATMs. Current EU law makes it difficult for businesses to offer cashback when people are not paying for goods and this has been a barrier to widespread adoption.
The Government is now considering scrapping these rules once the transition period ends on December 31, 2020.
