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New guidance for shop owners

The HM Government guidance titled Working safely during COVID-19 in shops and branches has been updated. The updates relate to managing product handling and returns, the test and trace service, safer travel and managing security risks.
The guidance is relevant to all retail stores, bank branches, post offices and other open money businesses. This document sets out guidance on how to work safely and has been prepared by the Department for Business, Energy and Industrial Strategy (BEIS). It gives practical considerations of how this can be applied in the workplace.
– The guidance includes advice on the following main areas:
– Thinking about risk
– Who should go to work
– Social distancing at work
– Managing your customers
– Cleaning the workplace
– Personal protective equipment (PPE) and face coverings
– Workforce management
– Inbound and outbound goods
The guidance applies to those outlets that are currently open and will help those that are currently closed consider how to adapt their operations when they are allowed to open.
Employers remain legally responsible to protect workers and others from risk to their health and safety and must keep risk assessments for COVID-19 updated as the outbreak risks and government guidance continue to evolve.
Public health is devolved in Northern Ireland, Scotland and Wales so this guidance should be considered in those parts of the UK alongside local public health and safety requirements and legislation.

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Last Call ! Option to defer VAT payments ends 30 June 2020

The option to defer your VAT payments ends on 30 June 2020. The Coronavirus VAT payment holiday gave businesses the chance to defer the payment of any VAT liabilities between 20 March 2020 and 30 June 2020.
Businesses that took advantage of deferring their VAT payments should consider the following:                                                                                                  – Re-establish any cancelled direct debits in enough time for HMRC to take VAT payments due from 1 July onwards.
– Going forward, ensure that VAT returns are submitted as normal.
– Pay the VAT in full on any payments due after 30 June 2020.
It is important to note that where the payment of VAT has been deferred, any VAT due must be paid by 31 March 2021. Businesses can also make additional payments with subsequent returns. No interest or penalties will accrue on deferred payments that are paid by the new due date.
There is no application process required to request this deferral as permission is automatic and all VAT-registered UK businesses are eligible. The choice to defer VAT payments was optional and businesses could still choose to pay any VAT due as normal. The deferral did not cover payments for VAT MOSS or import VAT. HMRC has continued to process VAT reclaims and refunds as normal during this time.

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Corporation Tax – carrying back losses

Corporation Tax relief may be available where a company or organisation makes a trading loss. The loss may be used to claim relief from Corporation Tax by offsetting the loss against other gains or profits of the business in the same or accounting period.

Where the amount of a trading loss exceeds the profits of the same accounting period, the company may claim to carry back the excess against the profits of preceding accounting periods. The preceding accounting periods are those falling wholly or partly within the preceding period.

Losses may only be carried back against profits of a preceding accounting period if the company was carrying on the trade (in which the loss was incurred) at some time in that accounting period.

Any claim for trading losses forms part of the Company Tax Return. The trading profit or loss for Corporation Tax purposes is calculated by making the usual tax adjustments to the figure of profit or loss shown in the company’s or organisation’s financial accounts.

If a company ceases to carry on a trade, the preceding period is three years preceding the accounting period in which the loss is incurred. Accounting periods must be taken in order, most recent first.

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Expenses and benefits filing deadlines

The deadline for submitting the 2019-20 forms P11D, P11D(b) and P9D is 6 July 2020. Employees must also be provided with a copy of their P11D by the same date.

Employers pay Class 1A National Insurance contributions on most benefits. If you provided taxable benefits to staff or directors your business is likely to have a Class 1A employers’ NIC liability. The deadline for paying class 1A NICs is 22 July 2020 (or 19 July if paying by cheque).

P11D forms are used to provide information to HMRC on all Benefits in Kind (BiKs), including those under the Optional Remuneration Arrangements (OpRAs) unless the employer has registered to payroll benefits. This is known as payrolling and removes the requirement to complete a P11D for the selected benefits. However, a P11D(b) is still required for Class 1A National Insurance payments regardless of whether the benefits are being reported via P11D or payrolled.

Where no benefits were provided during 2019-20 and a form P11D(b) or P11D(b) reminder is received, employers can either submit a ‘nil’ return or notify HMRC online that no return is required. Employers should ensure that they complete their P11Ds accurately, including the full details of cars and loans provided. There are penalties for late filing of returns.

Any tax or National Insurance due for 2019-20 under a PAYE Settlement Agreement (PSA) needs to be paid electronically to clear into HMRC’s bank account by 22 October 2020 (19 October 2020 for payments by cheque).

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“Agent Update”: June 2020

Agent Update- Get guidance from HMRC if you’re a tax agent or an adviser. Agent Updates give guidance and news to tax agents and advisers.
HMRC has released the latest bi-monthly issue of the ‘Agent Update’ publication which includes summaries of recent changes and updates that have been announced. The document which is aimed at taxation and accountancy practitioners includes links to more detailed information on each of the topics covered.
The topics covered in the latest edition include the following:
COVID-19. A reminder that the GOV.UK portal includes details of all the various financial support and other measures available to employers, businesses and employees.
HMRC’s Basic PAYE Tools (BPT). The BPT has been updated to version 20.2 to include further guidance on Statutory Payments in the ‘Calculators’ section.
Tax rules on waiving your income or donating to charity. Employers, directors and employees have several options to support a business or employer and / or to make donations to charity.
Lifetime ISA rules change. A temporary reduction in the Lifetime ISA withdrawal charge to 20% is available from 6 March 2020 until 5 April 2021. This means account holders will only have to pay back any government bonus they have received but will not pay the additional withdrawal charge.
Agreed tax postponements automatically extended until the end of June 2020. HMRC has written to taxpayers whose tax payments had already been postponed due to COVID-19 issues, informing them that that the postponement has been extended to 30 June 2020.
End of year reporting. The deadline for reporting any Class 1A National Insurance contributions and submitting P11D and P11FD(b) forms to HMRC for the tax year ending 5 April 2020 is 6 July 2020.
Links to new Revenue & Customs Briefs.

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No extension to Brexit Withdrawal Agreement

The UK has confirmed that it will neither accept nor seek any extension to the Brexit transition period which expires on 31 December 2020. The EU has formally accepted this position. With just over six months to go before the end of the transition period there remains a lot of work to be done if agreement is to be reached. This move could result in the possibility of a no-deal Brexit.

From 1 January 2021, the UK will have autonomy to introduce its own approach to goods imported to GB from the EU. Recognising the impact of Coronavirus on businesses’ ability to prepare, and following the announcement in February that the UK would implement full border controls on imports coming into GB from the EU, the UK has taken the decision to introduce the new border controls in three stages ending 1 July 2021. This flexible and pragmatic approach will give industry extra time to make necessary arrangements.

The stages are:

  • From January 2021:
  • Traders importing standard goods, covering everything from clothes to electronics, will need to prepare for basic customs requirements, such as keeping sufficient records of imported goods, and will have up to six months to complete customs declarations. While tariffs will need to be paid on all imports, payments can be deferred until the customs declaration has been made. There will be checks on controlled goods like alcohol and tobacco. Businesses will need to consider how they account for VAT on imported goods. There will also be physical checks at the point of destination or other approved premises on all high risk live animals and plants.
  • From April 2021: All products of animal origin (POAO) – for example meat, pet food, honey, milk or egg products – and all regulated plants and plant products will also require pre-notification and the relevant health documentation.
  • From July 2021: Traders moving all goods will have to make declarations at the point of importation and pay relevant tariffs. Full Safety and Security declarations will be required, while for SPS commodities there will be an increase in physical checks and the taking of samples: checks for animals, plants and their products will now take place at GB Border Control Posts.
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HM Treasury coronavirus (COVID-19) business loan

HMT Information about the Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS), Bounce Back Loan Scheme (BBLS) and Future Fund Scheme.

Under the Coronavirus Business Interruption Loan Scheme (CBILS), 49.247 businesses have received funding so far, with lenders approving £10.11 billion.

The Coronavirus Large Business Interruption Loan Scheme (CLBILS) has approved £1.77 billion in loans to 279 larger businesses.

Under the Bounce Bank Loan Scheme (BBLS), for small and micro businesses, in the five weeks since the launch over 863,584 businesses have successfully applied for funding totalling £26.34 billion.

The Future Fund is a special investment fund for high-growth companies impacted by the crisis, made up of funding from government and the private sector. Funding applications for the Future Fund opened on 20 May 2020 and the first government loans totalling £146.0 million have now been approved for 155 companies.

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VAT changes for the Construction Industry delayed again

HMRC has announced a second delay to the introduction of the domestic reverse charge for construction sector due to the impact of the coronavirus.
The scheme was due to come in on 1 October 2020 have been delayed for a further 5 months until 1 March 2021.
The reverse charge will only apply to supplies of specified construction services to other businesses in the construction sector.
From 1 March 2021, sub-contractors will no longer add VAT to their supplies to most building customers, instead, contractors will be obliged to pay the deemed output VAT on behalf of their registered sub-contractor suppliers. This is known as the Domestic Reverse Charge.
Please note!! Contractors will be responsible for paying the deemed output tax, on their VAT return they can usually claim back the same amount as input VAT.
The new rules were originally expected to come into force from 1 October 2019. The initial 12 month delay was announced following intense lobbying by the construction industry who had argued that many businesses in the sector were unprepared for the change. HMRC have confirmed, that even with this additional delay, they remain committed to the implementation of the Domestic Reverse Charge.
There will also be an amendment to the original legislation, which was laid in April 2019, to make it a requirement that for businesses to be excluded from the reverse charge because they are end users or intermediary suppliers, they must inform their sub-contractors in writing that they are end users or intermediary suppliers.

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