 The UK Government and the Chancellor have set out a package of temporary measures to support public services, people and businesses through this period of disruption caused by COVID-19.
This includes actions to support businesses including:
If you need help with your applications for government grants, loans and allowances as described above then as authorised HMRC agents and expert tax accountants Tax Affinity Accountants are available to support your business at this critical time. Urgently contact us by clicking here and we will use our expertise to support your business through this difficult time. Support for businesses through the Coronavirus Job Retention Scheme Under the Coronavirus Job Retention Scheme, all UK employers are able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis. Eligibility All UK businesses are eligible. How to access the scheme You will need to:
If your business needs short term cash flow support, you may be eligible for a Coronavirus Business Interruption Loan. Support for businesses through deferring VAT and Income Tax payments Government will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. VATFor VAT, the deferral will apply from 20 March 2020 until 30 June 2020. Eligibility All UK businesses are eligible. How to access the scheme This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal. Income Tax For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021. Eligibility If you are self-employed you are eligible. How to access the scheme This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period. HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities. Support for businesses who are paying sick pay to employees Goverment will bring forward legislation to allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The eligibility criteria for the scheme will be as follows:
You are eligible for the scheme if:
A rebate scheme is being developed. Further details will be provided in due course once the legalisation has passed. Government websites will contain more details. Support for businesses that pay business ratesBusiness rates holiday for retail, hospitality and leisure businesses Goverment will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible. Eligibility You are eligible for the business rates holiday if:
There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible. You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator. Further guidance for local authorities is available in the expanded retail discount guidance. Cash grants for retail, hospitality and leisure businessesThe Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property. For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000. For businesses in these sectors with a rateable value of between £15,001 and £51,000, they will receive a grant of £25,000. Eligibility You are eligible for the grant if:
You do not need to do anything. Your local authority will write to you if you are eligible for this grant. Guidance for local authorities on the scheme will be provided shortly. Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority. Find your local authority on Google. Support for businesses that pay little or no business ratesThe government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered releif. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs. Eligibility You are eligible if:
Guidance for local authorities on the scheme will be provided shortly. Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority. Find your local authority on Google. Support for businesses through the Coronavirus Business Interruption Loan SchemeA new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to support primarily small and medium-sized businesses to access bank lending and overdrafts. The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value. Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments. Eligibility You are eligible for the scheme if:
You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow. The scheme will be available from early next week commencing 23 March. Support for larger firms through the COVID-19 Corporate Financing Facility Under the new Covid-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies. This will support your company if it has been affected by a short-term funding squeeze, and allow you to finance your short-term liabilities. It will also support corporate finance markets overall and ease the supply of credit to all firms. Eligibility All UK businesses are eligible. How to access the schemeThe scheme will be available early in week beginning 23 March 2020. The Government will provide information on how to access the scheme soon - keep an eye on their website updates. More information is available from the Bank of England website. Support for businesses paying tax: Time to Pay serviceAll 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 on a case-by-case basis and are tailored to individual circumstances and liabilities. Eligibility You are eligible if your business:
If you’re worried about a future payment, call HMRC nearer the time. Insurance Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim as long as all other terms and conditions are met. Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics. If you need help with your applications for government grants, loans and allowances as described above then as authorised HMRC agents and expert tax accountants Tax Affinity Accountants are available to support your business at this critical time. Urgently contact us by clicking here and we will use our expertise to support your business through this difficult time. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames and Epsom they are considered in the Industry to be expert business accountants and tax advisors for small and medium sized businesses (SME's). Helping and supporting limited company owners and self employed people throughout the UK, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.
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 A large number of clients are asking us for help in understanding how the UK Government is going to support the employed, self employed & SME businesses during the coronavirus COVID-19 pandemic. The Prime Minister & Chancellor announced billions of pounds would be used to prevent businesses going under and support workers who have suddenly become unable to work.
Below is a helpful list of key points: Salaried Employees - the Coronavirus Job Retention Scheme
For Self employed, contractors and freelancers
Universal Credit and tax credit increase
SME Small & medium businesses - Coronavirus Business Interruption Loan Scheme
For renters
Other help
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames and Epsom they are considered in the Industry to be expert business accountants and tax advisors for small and medium sized businesses (SME's). Helping and supporting limited company owners and self employed people throughout the UK, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  So what are my options? The bridge between having a good business idea and implementing such idea into a business model can be wide and daunting. Getting the necessary funding to kick start your business can be a difficult process and different sources of finance may not be appropriate for everyone due to varying circumstances.
Whether you require investment for start-up capital or are looking to expand your business, the cost can be astronomically different depending on a few variables. Here is a list of things to consider when looking for a source of funding for your business: The “Right” Amount There are a few questions that should instantly appear on the forefront of your mind when you are seeking finance.
Doing your homework from the start will help you avoid many future problems. A shortfall in funding may jeopardise your business in its entirety, you may miss out on that explosive launch you was hoping for or realise that a particular project didn’t produce the desired results because you ran out of cash. There’s a subtle understanding in business that goes like this; “you need to spend money to make money”. Making big changes in your business requires money and not everyone has that money in their bank accounts. However, funding must not only be sufficient but efficient as well. There’s no point asking for more than you need, it will just result in more interest and a larger repayment towards the end. Plan out your budget by listing a breakdown of the different components the funding is used for. You may spot areas in which you can forgo and others that you may have missed out. And once you get the funding, you’ll know exactly what to do with it. Timing is Key Timing is essential in many aspects of life and its no different in regards to funding. Having a realistic time horizon to pay off your borrowings can make repayments easier and more manageable. Pacing your repayments can avoid interest payments from siphoning your cash flow. Tip: If your business is performing better than expected, think about repaying back the debt earlier to decrease the amount of interest accumulating. The Correct Choice Here comes the most difficult part when seeking for funds. How do I choose between so many options? Well unluckily for most, they don’t have as much choice as they think they do when it comes to the selection of finance. The most common for small businesses to get funding is through their own savings. This is, by far, the cheapest source of funding and the only opportunity cost associated is that you lose out on the interest on your savings which quite frankly is nothing compared to the potential interest payments you make for other sources of finance. However, a lot of the time, the money is not enough to fuel the business which leads to people opting for the next best choice; a bank loan. This may be the most appropriate option for many individuals seeking funding as terms can be flexible and mutually agreed upon by both parties. Tip: Try browsing through the different types of loans you can apply for, you may believe that there is some standard rate banks tend to charge for certain loans but be very surprised that the conditions of such loans can be as different as night and day. Take every percentage point at face value; there may not be much difference between 7% and 8% but over the long term you’ll end paying back significantly more in aggregate. Borrowing money through a loan or equity share from family and friends can be a good source of financial investment. Loans offered in this fashion tend to have a low interest rate compared to traditional loans and possess more lenient terms. Offering a piece of your business via equity distribution can motivate your family and friends to help grow your business. Be warned though that any business problems don’t end up trickling down to family matters. Also, make sure any loan agreement is in writing just to avoid any legal problems that may arise in the future. Another alternative of funding is through an outside investor. This is usually not a loan but an equity investment. This means that the investor becomes a shareholder in the business and is entitled to a percentage of the business profits (depending on his/her equity share percentage). Furthermore, the investor may have some degree of control in your business. Depending on the investor, this could be advantageous or disadvantageous. The outside investor could bring new ideas and contacts into the business which would help accelerate the growth of the business. On the contrast, the investor could be in disagreement with any business decisions made and hinder the progress of the business. It is up to the business owner to make sure the interests of both parties are aligned. One thing to note is that debts can be paid off but equity is fixed for the lifetime of the business which could result in equity being much more expensive if the business grows rapidly. At Tax Affinity Accountants we provide free tailored advice to help grow our clients business. By Wilson Law at Tax Affinity Accountants. Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they are considered to be small business experts helping and supporting business in the UK. They regularly help new business start up and provide valuable support for new businesses. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. 
Banking is slowly changing...
Making the Most of the New 7-Day-Switch Scheme for Banking
The long running perception of the UK banking sector as an oligopolistic market- one which is dominated by the four largest banks- may be challenged by the new 7-Day-Switch scheme which should substantially reduce barriers to switching your current account. According to the Office of Fair Trading, Britain’s four top banks- Lloyds banking Group, Barclays, RBS and HSBC- control around 75% of the current account market and have thus been able to offer sub standard current account deals to customers due to a lack of competition. The Government’s new 7-Day-switch scheme, which began on 16th September, does exactly what is says on the tin. Whereas customers have previously waited up to a month to switch bank accounts, under the new shake up of the banking sector, high-street banks have promised to switch current accounts within seven days. They will transfer across all payments into and out of customers’ accounts, thus reducing the perceived hassle of switching accounts. How the scheme may benefit you: With reduced barriers to switching your current accounts, it may be very sensible to start looking at some of the other offers around at present. A spokesperson from the Money Advice Service suggested it was “not uncommon to save £500 or £600 by switching your bank.” Summarised below are some of the best offers out there in the market at the moment: Cashback and Package Deals · Santander, 123 Account- One of the few accounts that offers interest on your money. It offers 1% on balances from £1000, 2% on balances from £2000, and 3% on those between £3000 and £20000. It also offers you cashback on household bills payable by direct debit (1% on water, council tax and mortgage payments; 2% on gas/electricity bills; and 3% on mobile phone and broadband). However, you will have to pay a £2 monthly fee and ensure a minimum monthly funding of £500 into the account. · Nationwide, FlexAccount- A packaged deal offering you worldwide family travel insurance, mobile phone insurance, breakdown cover and warranty cover for your appliances. You also get 3% interest on balances up to £2500 and a 3 month free overdraft, although there is a monthly fee of £10. Fee-free Deals · First Direct, 1st Account- Offers you £125 for switching plus a fee-free account provided you pay at least £1000 into the account each month. Further benefits include a fee-free overdraft up to £250 and excellent customer service (£100 cashback if you decide to leave within 6 months). · Halifax, Reward Current Account- You get £100 cashback when you switch plus £5 a month reward, provided you pay in at least £750 per month and pay out at least 2 direct debits. Business Current Accounts If you run your own business it will also be of benefit to compare the market for the best business account deals. Some of the key features include fee-free banking, interest on balances that remain in credit, and overdraft facilities. Some recommended business accounts are outlined below: · NatWest, Start-up Business account- Offers 2 years free banking with a £500 fee-free overdraft, provided your business is less than 12 months old with a turnover of less than £1 million. · Lloyds TSB, StartUp Account- 18 months free banking as long as your account remains in credit. You can also get consultation support from a relationship manager. · Santander, Business Start-Up Current Account- 12 months free banking and 0.25% interest on balances. Summary The key to finding the best deal for yourself is to ascertain exactly what benefits you most seek. If you often dip into your overdraft then it will be advantageous to look at accounts offering fee-free overdrafts. Alternatively, if you always remain in credit then you can start to shop around for higher interest rates and other perks from package deals. As a business owner you should also shop around to get the best deals and maximise the money you retain in your business. Very few current account deals are offering interest at present and thus your money is losing value in this inflationary climate. Therefore, it is certainly worth assessing your options in order to maximise the benefits you can receive. Furthermore, as the new 7-Day-Switch scheme begins to take effect, banks should start to offer more attractive and innovative packages to entice customers away from competitors. It is therefore worth keeping a beady eye on new offers as they enter the market. By Tom Hoadley at Tax Affinity Accountants. Tax Affinity based in Kingston upon Thames are expert accountants and tax advisers with client across the UK and abroad. For more information or a free initial consultation visit www.taxaffinity.com. Please feel free to comment and share this article with your friends. Follow us on twitter @Tax_Affinity for more money saving tips. |
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