Happy New Year (We Think)! – 8/1/2021

Happy New Year and although it’s been different, we hope you all had a good Christmas!  The start of 2021 has not been the best, but probably as expected in many ways. Our first blog of the year brings updated news and information on the various support packages that are available.

We have heard of a new scheme from the Chancellor this week to support this latest lockdown (see below), but we await the finer details and any updates on the other schemes already in place.  Meanwhile, there are also some huge gaps within the support packages (newly self-employed, Limited company owners, over £50,000 earners), which have been evident since the first lockdown, but we are yet to see anything to close these. We delayed this blog, thinking there may be further announcements, but there were none as at the time of writing. Rest assured, we will publish any updated news as soon as we get it.

In 2021 we will continue with regular blogs to provide updates and new information. If you have any questions or topics you would like us to cover then please let us know.  Here are the important news updates:

  • Furlough Scheme
    • Just before Christmas the Chancellor announced that he was extending this scheme to the end of April
    • Currently the scheme supports 80% of the wages of employees (excluding National Insurance and Employers Pension Contributions), but this percentage is due to be reviewed at the end of January to see what is required for the remainder of the scheme. Given the current scenario we find ourselves in, a change away from the 80% figure is not envisaged
    • This week the scheme was amended to specifically include workers who are unable to work due to Child Care responsibilities i.e. if you have an employee who is unable to work because they have to look after children for Covid related reasons, such as school closures, that member of staff can be furloughed
    • Some may recall that back in September the Chancellor announced a staff retention bonus of £1,000 for any staff furloughed up to the end of October who were still employed by the end of January 2021. With the extension of the furlough scheme, this sum has been withheld and will be reviewed later
    • In most cases Smarter Accounting has completed the furlough related work on behalf of employers with no additional cost. We saw this as our way of assisting clients during the early days of the pandemic and as a goodwill gesture. With the extension of the furlough scheme for November onwards, this is unfortunately no longer sustainable for us as a firm and therefore we have started to levy some admin charges to cover costs. I hope clients understand and accept our reasons for this
  • Self-Employment Income Support Grant (SEISG)
    • Claims are currently open for the November to January period and these have been since back in November. The closing date for these claims is 29 January 2021, so it is now time to get your claim in if you haven’t done so already
    • There will be another claim period from February to April, dates for when this claim opens have not yet been announced
    • As with the furlough scheme, the current percentage for this scheme is 80%, but this is due to be reviewed at the end of January for the next grant. Again, given current circumstances it seems unlikely that this percentage will reduce
  • Local Restrictions Support Grant (LRSG) / Additional Restrictions Grant (ARG)
    • These grants have been in position since the November lockdown and we know of many businesses who have successfully applied for sums for the first lockdown
    • These sums also carry on during tier 2 and tier 3 periods for businesses either being forced to close or ‘severely impacted’ by tier restrictions
    • Now we are into another national lockdown, more businesses are forced to close and a reminder of the monthly sums available are:
      • Properties with rateable value of £15k or under – £1,334
      • Properties with rateable value of £15k-£51k – £2,000
      • Properties with rateable value of over £51k – £3,000
    • The LRSG is restricted to those businesses that are registered for Business Rates, but for those businesses not registered for Business Rates then the ARG is a discretionary fund that can be claimed. The sums available are variable (locally determined) and are available for those businesses forced to close or ‘severely impacted’
    • A scan of the local District Council websites suggests that the LRSG and ARG for the current national lockdown are coming soon. We will update this status on future blogs
    • A search of your District Council website will show further details should you need to apply or want further information
  • Christmas Support Payment ‘wet led pubs’
    • This is a one off grant of £1,000 for wet led pubs and should be claimed via your local District Council
    • Most sites are showing that the scheme is open for applications, but the expectation is that the councils would contact those businesses applicable
  • New One-Off Top Up Grants for Retail, Hospitality and Leisure Businesses
    • New grant that was announced by the Chancellor on Tuesday
    • Limited to businesses who are registered for Business Rates, which we know will exclude some
    • The one-off sums available are:
      • Properties with rateable value of £15k or under – £4,000
      • Properties with rateable value of £15k-£51k – £6,000
      • Properties with rateable value of over £51k – £9,000
    • The grants will again be administered by District Councils. Further detailed guidance has not yet been released and therefore applications cannot yet be made. We will update the situation in future blogs
  • Bounce Back Loans
    • Many businesses have already taken advantage of loans under this scheme.
    • Loans are based on turnover (2019) and up to 25% of turnover can be borrowed, to a maximum of £50,000
    • Loans are interest and payment free in the first year, 2.5% per annum after that
    • Loans are guaranteed by the Government and the scheme has been extended to the end of March 2021

We appreciate that there is a whole load of updates in today’s blog, there is clearly lots going on and, please rest assured, we will continue to provide updates, as required.

At Smarter Accounting we are currently busy because the deadline for the filing of 2019/20 self-assessment tax returns is still 31 January 2021. There has been no indication that this will change. Currently 2019/20 figures are not being used in any of the grant calculation methods, however, it is possible this could change. Therefore, we recommend that if you have not yet brought in your records that you do so as a matter of urgency.

The Smarter Accounting Offices will continue to be staffed but will not be open for face to face meetings. We can always make other arrangements for video conferencing, telephone calls and at times garden meetings if required. If you are dropping off or collecting records via the office, please notify us in advance and wear a facemask.  Please be aware that we are reviewing our policy regards COVID 19 on, at least, a weekly basis.

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Best wishes and stay safe