As a result of the pandemic, companies incurring losses for tax purposes for accounting periods ending between 1 April 2020 and 31 March 2022 can now carry back these losses for up to three years rather than one year.
HMRC have advised that claims below £200,000 may be made outside of a corporation tax return via letter. Claims greater than £200,000 need to be made via the appropriate corporation tax return.
For all those clients that have losses, we will be making sure that your position is optimised and welcome this extension to the loss relief carry back period.
HMRC opened their portal for the self employed to claim their fourth grant at the end of the April 2021. Some sole traders who were ineligible for the previous three grant payments can now make a claim if they started their self-employment after 6 April 2019. There is still no relief of course for people who operate through limited companies.
If you have not yet claimed, this is a reminder that you must apply by the 01 June 2021.
HMRC Guidance states to be eligible for the fourth grant you must be a self-employed individual or a member of a partnership. You cannot claim the grant if you trade through a limited company or a trust.
You must have traded in both tax years:
2019 to 2020 and submitted your tax return on or before 2 March 2021
2020 to 2021
You must either:
be currently trading but are impacted by reduced demand due to coronavirus
have been trading but are temporarily unable to do so due to coronavirus
You must also declare that you:
intend to continue to trade
reasonably believe there will be a significant reduction in your trading profits
If you require any assistance with a grant application then please do not hesitate to contact us.
No one can deny that 2020 has brought everybody huge challenges on many fronts. However, the service provided by the Tax Authorities and also the major banks is so woeful that it is not acceptable for them to continue to hide behind the coronavirus crisis.
As a result, so many members of our professional body, the Institute of Chartered Accountants in England and Wales have reported numerous service issues and delays, the Institute has now made representations to the Tax Authorities to advise amongst other matters that taxpayers have been waiting up to three months just for a reference number to be issued for self-employment registrations, five months for VAT registrations to be completed, six months for Research & Development Relief Claims to be processed and more than six months for Corporation Tax losses to be actioned.
We have several cases ourselves where we have appealed against incorrectly issued Corporation Tax Penalty Notices which are taking up to five months to be dealt with. In the meantime, HMRC are instructing bailiffs to collect the penalties which were not due on the first place.
Whilst appreciating the pressure on HMRC’s resources and its achievement in delivering support in many cases, the ICAEW has pressed for an improvement of service standards.
We hope that HMRC will listen to these representations but in the meantime we would urge all clients to expect continued delays with all dealings with HMRC and to exercise as much patience as possible when waiting for matters to be dealt with. We are doing what we can to bring these matters to the attention of the authorities.
The Coronavirus Job Retention Scheme (furlough scheme) has been extended until 30 September 2021 and the level of grant available to employers under the scheme will stay the same until 30 June 2021.
1. Changes to the level of grant from 1 July 2021
From 1 July 2021, the level of grant will be reduced and you will be asked to contribute towards the cost of your furloughed employees’ wages. To be eligible for the grant you must continue to pay your furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they spend on furlough.
The table below shows the level of government contribution available in the coming months, the required employer contribution and the amount that the employee receives per month where the employee is furloughed 100% of the time.
Wage caps are proportional to the hours not worked.
May
June
July
August
September
Government contribution: wages for hours not worked
80% up to £2,500
80% up to £2,500
70% up to £2,187.50
60% up to £1,875
60% up to £1,875
Employer contribution: employer National Insurance contributions and pension contributions
Yes
Yes
Yes
Yes
Yes
Employer contribution wages for hours not worked
No
No
10% up to £312.50
20% up to £625
20% up to £625
For hours not worked employee receives
80% up to £2,500 per month
80% up to £2,500 per month
80% up to £2,500 per month
80% up to £2,500 per month
80% up to £2,500 per month
You can continue to choose to top up your employees’ wages above the 80% total and £2,500 cap for the hours not worked at your own expense.
In other words, if you have started the long furlough from July onwards, the employer is going to have to meet some of the costs as the amount paid by the government will reduce.
If you have any queries about how you might be affected or how the scheme will operate from 1 July onwards, please do not hesitate to contact us.
Many businesses do not realise that they have a legal obligation to register under the Data Protection Regulations with the Information Commissioner’s Office if they hold or process any personal information electronically.
Basically, this means that if you hold any addresses of customers or suppliers or personnel on your computers.
The ICO has been undertaking a campaign to contact virtually every company listed at Companies House who is not already registered with them to raise awareness and to try and get fees paid.
We have received hundreds of letters here at Martlet House for companies, many of which are dormant, or do not hold data, but if you receive such a letter, you do need to contact the ICO as soon as possible as they are now sending out reminders.
Also, if you do not hold personal information on computers, if you use CCTV for crime prevention reasons, that is also enough to require a data protection registration.
If you are found to be in breach of these regulations, the fines can be HUGE!
If you require any further information about the requirements, please do not hesitate to contact us.
12 months on and we are still feeling the effects of the pandemic and will for some time.
In March, immediately after the Chancellors latest budget, we asked SMEs across the UK to share their outlook for the next 12 months. The findings make for interesting reading – including:
46% of businesses with less than £250k turnover are expecting reduced income over the next 12 months.
67% of businesses with more than £5M turnover are projecting increased income.
Looking after existing clients, finding new clients and growth are the 3 biggest priorities for SMEs.
These findings, somewhat unsurprisingly, suggests that larger businesses are more insulated from the negative effects of the pandemic. Smaller firms, with less resources and less of a ‘safety net’, are feeling the effects more severely.
It is encouraging to see that 64% of businesses have reviewed their cashflow – a vital step to take at all times but even more so in these turbulent times.
A concern is the low number of businesses that are undertaking customer surveys. Keeping close to your customers has never been more important.
You can see a full copy of the tracker polls results together with our observations take in our SME Outlook Tracker Report by clicking on the link below.
We have also produced a handy one-sided leaflet to highlight some of the key steps that SMEs can take to futureproof their business. This is available to download below as well.
The landscape is ever changing. As ever, we are here to support you. If you would like to have a chat about the future and the steps you can take to futureproof your business as well as the practical steps you can take to support your business, please do get in touch.
Congratulations to our Jarrad Gilbertson for passing his Final ACCA Paper, Advanced Audit, with 63%. Jarrad only has two more to pass before becoming fully qualified!
A new government-backed loan scheme launched last week (6 April) to provide additional finance to those businesses that need it. Please click on the link for more information.
At the Martlet Partnership, we are always very pleased to share the successes of our clients and staff.
We are therefore pleased to announce that our Dan White has passed his final Accounts Preparation Paper of Level III of AAT with a resounding 87%.
We are also very pleased to announce that our client, Monika Slowikowska, of Golden Houses Developments Limited, has been nominated as a Business Development finalist for a European Women in Construction Award.
On 3rd March Rishi Sunak introduced a number of new measures of support for SMEs as part of his budget. He also extended some of the existing schemes as well as announcing some new initiatives designed to support the survival, growth and development of businesses.
Some of the support is specifically targeted to help businesses to grow. Please check out our handy infographic below and do get in touch if you need any further help.
