The current situation has impacted many of the businesses in the UK. Here is some information that can help you understand what the benefits and advantages are available to you.
Your limited company’s annual accounts - called ‘statutory account’ - are prepared from the company’s financial records at the end of your company’s financial year. You need to send your annual accounts filing to Companies House. There are different deadlines for sending your accounts to Companies House and your tax return to HMRC, but it's sometimes possible to send them at the same time.
How to put together statutory accounts:
Statutory accounts must include:
- a ‘balance sheet’ - this shows the value of everything the company owns, owes and is owed on the last day of the financial year
- a ‘profit and loss account’ - this shows the company’s sales, running costs and the profit or loss it has made over the financial year
- a director’s report (unless you’re a ‘micro-entity’)
It's possible that you might need to include an auditor’s report - this depends on the size of your company. 📍 Extend your account filing deadline
To help businesses to manage their cash flow, the Government announced it is deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments on account due in July 2020 under the Self Assessment system will be deferred to January 2021.
For VAT, the deferral will apply from 20th March 2020 until 30th June 2020. All UK businesses are eligible. Helpfully, the deferral is automatic. Businesses will not need to make a VAT payment until after 30th June 2020. Businesses will be given until the end of the 2020/21 tax year (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.
IR35 & off-payroll working
Due to the current COVID-19 pandemic crisis, HMRC has taken the decision to postpone the off-payroll working regime that will not take effect until April 2021 (this scheme was planned to start in April 2020).
Bank lending and overdraft: CBILS
The government announced a new temporary Coronavirus Business Interruption Loan Scheme (CBILS), delivered by the British Business Bank, launched on 23rd March 2020 to support primarily small and medium-sized businesses to access bank lending and overdrafts.
The scheme is for businesses with viable borrowing proposals, up to £5 million in value, that the COVID-19 outbreak has ‘interrupted’. Businesses can access the first 12 months of that finance interest-free, as the government will cover the first 12 months of interest payments. Businesses are eligible for the scheme if they:
- are UK based, with a turnover of no more than £45 million per year
- meet the other British Business Bank eligibility criteria.
When the scheme was announced, it was not open to businesses that could access loans on commercial terms. However, the government agreed these businesses can access the scheme if they self-certify that coronavirus has had an impact on them and they have a viable borrowing proposal. Another change to the scheme means lenders cannot ask directors for personal guarantees on any loans under £250,000. Businesses with loans over £250,000 will have recoveries capped at 20 percent of the outstanding CBILS facility amount.
The changes are backdated to 23rd March 2020.
To protect businesses during this period, commercial tenants who are unable to pay rent because of coronavirus will be protected from evictions. will mean no business will be forced out of their premises if they miss a payment in the next 3 months.
More information on www.gov.uk
The business rate relief for retail, leisure and hospitality businesses.
The rate relief is eligible if your property is a: shop, restaurant, café, bar or pub, a cinema or live music venue, assembly or leisure property (sports club, gym or spa), hospitality property (hotel, guest house or self-catering accommodation). There will be no business rates for the 2020 to 2021 tax year to pay for those businesses.
Small Business Grant Fund / Retail, Hospitality and Leisure Grant Fund
If you are eligible for the small business rate relief (SBRR), it's possible you are for the Small Business grant fund too.
If you are in major financial difficulties: HMRC Time To Pay Scheme
All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time to Pay service. These arrangements are agreed upon on a case-by-case basis and are tailored to individual circumstances and liabilities. You are eligible if your business pays tax to the UK government and has outstanding tax liabilities.
Our advice to any of our customers who have missed a tax payment, or who believe they are at risk of missing the next payment due to COVID-19, is to call HMRC’s dedicated helpline on 0800 0159 559. If you’re worried about a future payment, call HMRC nearer the time.
Get a loan from the government with the Bounce Back Loan
To help small and medium-sized businesses, HMRC has launched the coronavirus Bounce Back Loan that could enable you to borrow between £2000 to £50.000 with no interest fees for the first 12 months.