Self-employment Income Support Scheme – Update

We have been contacted by HMRC today to say they will start contacting people this week who may be eligible for the scheme.

HMRC will work out if you’re eligible and how much grant you may get but they have created an online tool where you can check eligibility in advance.

The online service to make the claim is not yet available but they have stated you will need your Government Gateway account to access this. If you have not already created a Government Gateway account this can be done as part of checking eligibility online.

Please click on this link to access HMRC’s guidance on the scheme which includes the eligibility tool.

Bounce Back Loan Scheme

The Government have now announced a further loan scheme designed to help the smallest of businesses that have been affected by COVID-19.

The key details are summarised below:

– The scheme will help small and medium-sized businesses to borrow between £2,000 and £50,000 (up to 25% of turnover).

– It will launch on 4 May 2020 and be delivered through accredited lenders.

– The government will guarantee 100% of the loan and there won’t be any fees or interest to pay for the first 12 months.

– Loan terms will be available for up to 6 years and no repayments will be due during the first 12 months.

Further information can be found by clicking the following link.

Job Retention Scheme – Further Details

Updated 18 April 2020

Full guidance can be found on GOV.UK by clicking on the following link.

Some of the key details are as follows:

-The scheme will provide support to employers whose business has been severely affected by COVID-19 by way of a grant towards wages of employees who have been furloughed.

-A portal will be created for employers to claim 80% of furloughed employees usual wages up to £2,500 per month plus associated Employers National Insurance and minimum automatic enrolment employer pension contributions.

-It will be for a 4 month period (previously 3 months) starting from 1st March 2020 and the portal should be open on 20 April.

-It is open to all UK employers who had a PAYE scheme created and started on 19 March 2020 (previously 28 February 2020).

-Employees must have been on the payroll and a RTI submission made on or before 19 March 2020 (previously 28 February 2020).

-Employers should write to their employees confirming that they have been furloughed and this should be for a minimum period of 3 weeks.

-Once furloughed employees can not undertake any work for the employer.

-For salaried employees their last pay prior to 19 March 2020 (previously as at 28 February 2020) should be used to calculate the grant.

-For employees with variable pay, if they have been employed for more than 12 months then the claim can be the higher of, the same month last year or an average of the 19-20 tax year. If they have been employed less than 12 months then it will be an average since they started.

It is now confirmed Directors will be able to use the scheme as long as they meet all the normal eligibility requirements.

Self-employment Income Support Scheme

Further measures were announced on Thursday 26th March to provide financial support to the self-employed. Here is a summary of the detail and eligibility.

-It will provide a grant to self-employed individuals and members of partnerships worth 80% of profits up to a cap of £2,500 per month whose income has been negatively impacted by COVID-19.

-The scheme will run for an initial 3 month period beginning from 1st March.

-Need to have filed a tax return for 2018-19 (and if currently still not filed there is 4 weeks to do so). If you were also self-employed during 2016-17 and 2017-18 profits will be averaged to calculate the grant.

-Will have continued to trade as self-employed during 2019-20, be currently trading other than the effects of COVID-19 and intend to continue to trade into the 2020-21 tax year.

-Have trading profits of less than £50,000.

-More than half of total income was from self-employment.

The scheme will be dealt with by HMRC and there is no need to contact them. They will use existing information to look at eligibility and invite applications when the scheme is operational. The grant will be paid directly into bank accounts and it is expected these will commence from the beginning of June.

COVID-19 Business Rates Grant

Further to our last post regarding Business Support we have become aware of an application form from Newark and Sherwood District Council for the Business Rates Grant. This can be accessed by clicking link here.

We have not been able to find the equivalent for Mansfield District Council but their website does say they should start writing out to applicable businesses this week.

If you are under another local authority please check their website for further information.


COVID-19 Available Support for Business

Following our last post please see below a summary of measures available to support businesses.


– a 12 month business rates holiday for all retail, hospitality, leisure and nursery businesses in England

– a small business grant of £10,000 for all businesses in receipt of small business rate relief or rural rate relief

– a grant of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000

– a job retention scheme which pays 80% of wage costs for workers who would otherwise have been laid off

– support for businesses who are paying statutory sick pay due to COVID-19

– VAT payments which are due between 20.3.20 and 30.6.20 can be deferred until the end of the 2020/21 tax year

– income tax payments which are due by 31.7.20 can be deferred until January 2021

– a business interruption loan scheme

As of today, Monday 23rd March it is our understanding the business interruption scheme is now open. The grants available will be dealt with directly by your local authority and they will write out to businesses directly, this should happen during April. The job retention scheme is to be administered by HMRC and they are currently building a system to operate this, they expect this to be in place for early April. The VAT and income tax payment deferral are automatic and there is no need to contact HMRC.

Further detail from GOV.UK can be found by clicking here.

Making Tax Digital – Update

The commencement of Making Tax Digital for VAT (MTDfV) is now less than a month away. We have been working with our clients over the last few months to bring them up to speed and find the best solution to make sure they are compliant when MTDfV starts.

In recent weeks HMRC has updated their website with a step by step process guide which also includes the link for signing up to MTDfV. Please click here for a link to the webpage.

The key points to remember are that once you have filed your last VAT return under non-MTDfV you then need to sign up for MTDfV as mentioned above and following acknowledgement of this your software will need to be authorised.

This authorisation process will vary from software to software and you may need to speak to your provider on how this is done.


Making Tax Digital


Over the past few years the government has been setting out its plans to transform the tax system, known as Making Tax Digital (MTD).

The proposals introduce digital record keeping and quarterly updating to HMRC by businesses, the self-employed and landlords for Income Tax Self Assessment, VAT and Corporation Tax.


The MTD requirements will apply to VAT registered businesses (where their turnover is over the compulsory registration threshold of £85,000) from April 2019. For Income Tax Self Assessment and Corporation Tax it will not be before April 2020 at the earliest.

What does this mean for your business

MTD for VAT will mean businesses must keep their VAT records digitally and provide their return information to HMRC via MTD compatible software. The software will need to link with HMRC so that information can be exchanged both ways. Spreadsheets will be classed as digital record keeping but will not be able to link with HMRC without bridging software. It is therefore expected many small businesses will need to move their record keeping across to compatible software in time to meet the requirements.

Where can we help

At present detailed information of what will be required is limited and many software providers are still working on making their software compliant. We will be communicating with our clients via post, telephone and in person (as well as through further posts on here) to keep you updated as things progress. We are talking with our software providers about what they will be providing as well as familiarising ourselves with what we expect will be the most commonly used pieces of software.

The service we provide will vary according to each clients requirements and we will be discussing this in the coming months. In the mean time if you have any questions on MTD please feel free to contact us.

Dividend Tax Changes

As announced in the budget on 8th July 2015 changes to the way dividends are taxed will be introduced from 6 April 2016.

The old system of the dividend tax credit will be abolished and there will be the introduction of a new dividend tax allowance of £5,000 a year. The new rates of tax on dividends above the allowance will be 7.5% for basic rate taxpayers, 32.5% for higher rate taxpayers and 38.1% for additional rate taxpayers.

This change obviously has an impact on owner managed limited companies where dividends are used as part of remuneration. We will therefore need to look at each case individually to assess the impact and advise how this may be reduced.

The Second Budget 2015

On 8th July 2015 the Chancellor presented his first budget of this Parliament.

Business Tax
Corporation Tax will be reduced by 1% to 19% for the years beginning on 1.4.17, 1.4.18 and 1.4.19. A further 1% reduction will apply from 1.4.20 making the rate 18%.

Annual Investment Allowance has been changed with the rate set at £200,000 per year commencing from 1.1.16. The current allowance of £500,000 remains in place until 31.1.15.

Personal Tax
The personal allowance will increase to £11,000 on 6.4.16 and £11,200 on 6.4.17.

The higher rate (40% tax) threshold will increase to £43,000 on 6.4.16 and £43,600 on 6.4.17.

A new personal savings allowance will be introduced from 6.4.16 and will mean basic rate taxpayers can receive up to £1,000 of savings income tax free while higher rate tax payers can receive £500.

From 6.4.16 a change to the way dividends are taxed will be introduced. The current tax credit will be removed and replaced with a £5,000 dividend allowance. Dividends above £5,000 will be taxed at 7.5% for basic rate taxpayers, 32.5% for higher rate taxpayers and 38.1% for additional rate (45%) taxpayers. Please see our separate article to follow.

On buy to let properties the amount of income tax relief on finance costs will be restricted to the basic rate. This will be phased in from 6.4.17 over the following four years. The restriction will not apply to furnished holiday lettings. Also from 6.4.16 the Wear and Tear allowance on furnished residential property will be replaced by the actual costs of replacing furnishings. There will also be an increase in Rent-a-Room relief from £4,250 to £7,500 from 6.4.16.

Inheritance Tax
An additional nil rate band where a residence is passed down to direct descendants will be introduced. From 6.4.17 this will be £100,000, from 6.4.18 £125,000, from 6.4.19 £150,000 and from 6.4.20 £175,000. These allowances can be transferred to the surviving spouse or civil partner. This potentially increases the the IHT nil rate band to £1 million for a couple from 6.4.20.

Other Changes
From 6.4.16 a new minimum wage will be introduced for those aged 25 and above. This will be set at £7.20 per hour.

The Employment Allowance will increase from 6.4.16 to £3,000 per year but will no longer be available to companies where the director is the sole employee.