Covid-19

The Low Incomes Tax Reform Group (LITRG) has warned self-employed individuals that the government’s coronavirus (COVID-19) Self-employment Income Support Scheme (SEISS) is taxable. The group is concerned that many may wrongly assume that the SEISS funds are exempt from tax, particularly as they are termed ‘grants’ by the government. It is warning that many people may have to pay a third of the grant back in tax and Class 4 national insurance contributions (NICs). The LITRG said that grants made…

The government has extended the Coronavirus Job Retention Scheme (CJRS) for parents on statutory maternity and paternity leave. The Treasury recently announced that parents who are returning to work over the coming months will be eligible for the CJRS despite the scheme closing to new entrants on 30 June. Individuals on adoption leave, shared parental leave and parental bereavement leave will be eligible, but only if they work for a business that has furloughed employees. Commenting on the matter, Chancellor…

Business loans through government-backed coronavirus support schemes have reached almost £35 billion, according to the latest figures published by the Treasury. The figures show that £3.6 billion has been granted to 85,000 businesses in the past week, taking the total to £34.9 billion. The Bounce Back Loan Scheme (BBLS), which allows small businesses adversely affected by the COVID-19 pandemic to apply for up to £50,000 with the government guaranteeing 100% of the advance, continues to be the most popular scheme.…

The Institute of Directors (IoD) has warned that business debt will hinder the economic recovery from the coronavirus (COVID-19) unless steps are taken to make the burden more manageable. The IoD polled 720 company directors and found that 51% believe that debt their company has taken on during the pandemic will have a negative impact on their recovery. 57% said that debt will hold back their investment plans for the next two years. The business group is calling on the…

HMRC has reminded employers who intend to furlough an employee for the first time that the deadline to do so is approaching fast. The Coronavirus Job Retention Scheme (CJRS) will be closed to new entrants from June 30. In order for the minimum three-week furlough period to be completed by then, the final date which an employer can furlough an employee for the first time is June 10. Employers will have then have until 31 July to make any claims…

HMRC has announced a five-month delay to the introduction of the domestic VAT reverse charge for construction services, due to the impact of the coronavirus (COVID-19) pandemic on the sector. The change will now apply from 1 March 2021 and will overhaul the way VAT is payable on building and construction invoices as part of a move to reduce fraud in the sector. Under the domestic reverse charge, the customer receiving the service will have to pay the VAT owed…

A fifth of highly skilled freelances face having to close their business due to the impact of the coronavirus pandemic, according to research from the University of Edinburgh Business School. The study, which surveyed over 1,400 highly skilled freelancers, found that three quarters of them had lost income, with an average drop of 76%. As a result, over two thirds say they now have cashflow problems. The research found that over 90% of these freelancers could not access the government’s…

A strong economic recovery following the coronavirus pandemic is likely although many risks and uncertainties remain, according to a report from Oxford Economics. The report, which was commissioned by the ICAEW, predicts that the economy should return to growth in the second half of the year if the lockdown continues to be relaxed over the summer. It says the unusual nature of this recession could prove to be a silver lining for the recovery. Because GDP has fallen due to…

Over £31 billion has been borrowed through the government-backed schemes that are providing business support during the coronavirus (COVID-19) crisis, according to the latest figures from the Treasury. More than 745,000 businesses have now accessed support through either the Bounce Back Loan Scheme (BBLS), the Coronavirus Business Interruption Loan Scheme (CBILS) or the Coronavirus Large Business Interruption Loan Scheme (CLBILS). The BBLS is the most popular scheme, with over £21.3 billion lent through it since it was launched on 4…

The coronavirus crisis has left many manufacturers on a cliff edge and in need of government intervention, Make UK has warned. The industry body says that as COVID-19 is putting a growing number of firms on the brink of collapse as production levels continue to fall. In response, Make UK is asking the government to step in with direct state support to ensure the short-term survival of firms. It said support should especially be targeted at the aerospace, car making…