be0a6709 09e3 4bb2 a339 7bd19786e308 800x380 - Job Support Scheme for closed businesses

Job Support Scheme for closed businesses

The CJRS or furlough scheme ended on 31 October 2020 and has been replaced by the Job Support Scheme (JSS). This JSS has been designed to help businesses and employees deal with a fresh spike of the virus and a winter of uncertainty.

The JSS is now split into two parts, the JSS Open for businesses which remain open and the JSS Closed for businesses that are forced to close because of local or national lockdown measures. The two parts of the scheme will run in parallel for 6 months until 30 April 2021.

The provisions of the JSS Closed are more generous and reflect the fact that the employee is unable to work. This would mean they are under Tier 3 restrictions in England or similar lockdown regulations in Scotland, Wales or Northern Ireland.

Under the specific terms of the JSS Closed, the government will pay two-thirds (67%) of employees’ salaries, up to a maximum of £2,083.33 a month. Employees must be off work for at least 7 consecutive days to benefit from the expanded scheme. Businesses will only be able to use the JSS Closed whilst they are subject to specific lockdown measures that require the closure of their business premises.

Employers will have the discretion to top-up the payments if they so wish. This will help protect employee incomes, limit unemployment, and retain employer-employee matches so that these premises are able to reopen as quickly as possible when circumstances allow.

In line with the JSS Open, the grant will be paid in arrears, reimbursing the employer for the government’s contribution. An employer can claim the JSS Open and JSS Closed at the same time for different employees, for example a retailer with some premises that remain open and some that are forced to close.

Affected employees under the JSS Closed may also be entitled to additional financial support, including Universal Credit.

Source: HM Revenue & Customs Wed, 28 Oct 2020 00:00:00 +0100
548baa9a 6801 4ff7 a83d b420ea122827 800x380 - JSS – financial impact test for large employers

JSS – financial impact test for large employers

The Job Support Scheme (JSS) Open is available from 1 November 2020 for businesses that remain open but with employees working reduced hours. Employees must work at least 20% of their usual hours, paid as normal, in order to qualify for the JSS Open. The employee will then receive 66.67% of their normal pay for hours not worked. Employees will therefore forego one-third of their pay for the hours that they have not been working.

The contribution for hours not worked will be made up of contributions from the employer and government. The government will fund up to 61.67% of wages for hours not worked per employee whilst the employer will fund a further 5%.

The JSS Open is available to all small and medium-sized businesses, but larger businesses have to meet a financial impact test to demonstrate that their turnover has fallen as a result of the pandemic.

A large employer is defined for this purpose as a legal entity with 250 or more employees across their payrolls on 23 September 2020. If the employer’s turnover has remained equal or has decreased compared to the previous year, then they will qualify. This test only needs to be taken once before the employer's first claim for the Job Support Scheme.

Large employers who are VAT registered and submit quarterly VAT returns should compare the total sales figure on their VAT return, which is due to be filed and paid between 31 August 2020 and 7 November 2020, with the total sales figure from the same quarter in 2019. There are similar measures for employers who submit VAT returns on different staggers. Further guidance is expected to be published shortly for large employers who are not VAT registered.

Any charity with 250 or more employees that is registered with a UK charity regulator or are exempt from such registration is not required to carry out the test and will be considered eligible for the scheme.

Source: HM Revenue & Customs Wed, 28 Oct 2020 00:00:00 +0100
b78ff857 eb9b 4f34 bedf 2a5293d79c58 800x380 - JSS fraudulent claims

JSS fraudulent claims

The Job Support Scheme (JSS) has replaced the Coronavirus Job Retention Scheme (CJRS) which came to an end on 31 October 2020.There are significant concerns that between 5%-10% of claims made under the CJRS were fraudulent or made in error.

There are additional anti-fraud measures in place to help prevent fraudulent claims made under either the JSS Open or JSS Closed. In order to help make the new JSS more secure, checks will be put in place and payments claimed may be withheld if HMRC suspects a claim to be ineligible. Whilst this may help reduce fraudulent claims it leaves the employer having to fund the government grant which will be paid in arrears.

Other measures announced by HMRC to combat fraud under the JSS include:

  • The amount of any overpayment by the employer must be paid back to HMRC where a claim contains incorrect information.
  • The full amount of any grant must be repaid if a claim is found to be fraudulent. Penalties of up to 100% of the amount overclaimed may be applied where appropriate.
  • HMRC will consider publishing the details of employers who are charged a penalty because of a deliberately incorrect Job Support Scheme grant claim.
  • HMRC intends to publish the names of employers who have used the scheme.
  • The public can report fraud to HMRC if they have evidence to suggest an employer is abusing the scheme.
  • Employees will be able to check if their employer has made a claim relating to them via their Personal Tax Account.
Source: HM Revenue & Customs Wed, 28 Oct 2020 00:00:00 +0100
7a7ede5b b4f0 4e8d bdbf 086ccc781a8e 800x380 - Handling food? Wash, those hands

Handling food? Wash, those hands

If you are considering any change to your business activities that will involve handling any packaged food or raw ingredients, as you would expect, there are a raft of regulations that you will need to consider and adopt.

The Department of the Environment has published considerable guidance on the GOV.UK website. Simply Google “Guidance for food businesses on coronavirus”. A brief extract from their guidance follows. 

Although it is very unlikely that COVID-19 is transmitted through food or food packaging, as a matter of good hygiene practice your staff should wash their hands frequently with soap and water for at least 20 seconds. This should be done routinely, including:

  • before and after handling food 
  • before handling clean cutlery, dishes, glasses, or other items to be used by the customer
  • after handling dirty or used items, such as collecting used dishes from customer tables 
  • after handling money 
  • after touching high-contact surfaces, such as door handles
  • when moving between different areas of the workplace
  • after being in a public place
  • after blowing your nose, coughing or sneezing. Coughs and sneezes should be caught in a tissue or the crook of your elbow

Food packaging should be handled in line with usual food safety practices and staff should continue to follow existing risk assessments and safe systems of working.

Readers who need more information should research the following:

  • Food Standard Agency’s (FSA) guidance on personal hygiene and hygienic practices in food preparation, 
  • Hazard Analysis and Critical Control Point (HACCP) processes and 
  • Guidance on risk assessment from the Health and Safety Executive (HSE).
Source: HM Government Tue, 27 Oct 2020 00:00:00 +0100
baf70560 79df 4e12 bfc5 3af86641be6b 1 800x380 - New financial support measures announced

New financial support measures announced

The Chancellor, Rishi Sunak, has delivered his third major statement to the House of Commons in less than a month. This followed the Winter Economy Plan on 24 September and further announcements on 9 October that expanded the scope of the Job Support Scheme and introduced new grants for businesses forced to close because of local or national lockdown measures.

In his third statement delivered on 22 October, the Chancellor has significantly revised previously announced measures to help protect jobs across the UK whilst the country faces a fresh spike of the virus and a winter of uncertainty.

These measures are intended to offer increased support through the existing Job Support and self-employed schemes and to expand the availability of business grants to support companies in Tier 2 areas of England.

1. Job Support Scheme

Under the original terms of the Job Support Scheme, due to start on 1 November 2020, employees would have had to work at least one-third of their hours, paid as normal, in order to qualify. The government and employer would then each have covered one-third of any remaining hours the employee is not working.

Under the revised scheme announced today, the employer contribution to those unworked hours has been reduced to just 5% (from 33%), and the minimum hours requirements for staff has been reduced to 20% (from 33%). The Government will now fund up to 61.67% of wages for hours not worked, up to a maximum payment to £1,541.75 per employee.

These changes mean an employee will need to work just one day a week to be eligible for the scheme. The use of the scheme will be available to businesses in all alert levels.

The previously announced Job Retention Bonus, allowing qualifying businesses to claim a £1,000 for each CJRS participating employee, will remain. Employers can claim both the Job Retention Bonus and funding through the Job Support Scheme.

The Job Support Scheme will replace the existing Coronavirus Job Retention Scheme (CJRS) which ends on 31 October.

2. Self-Employment Income Support Scheme Grant Extension

The Chancellor also announced that the grants for the self-employed are to be doubled to 40% (from 20%) of previous qualifying earnings.

The initial lump sum will cover three months of profits from 1 November 2020 calculated as 40% of average monthly profits, up to a maximum total of £3,750. 

The extended scheme will apply for 6 months from 1 November 2020 with an initial taxable grant made available to those who continue to trade and meet the eligibility requirements.

An additional second grant will be available from 1 February 2021 to 30 April 2021. The level of this second grant amount is subject to review and will be set in due course.

3. Business grants

The Chancellor also announced an extension to the business grant measures previously announced for businesses in England that are forced to shut as a result of lockdown measures.

This extension to the scheme could benefit some 150,000 businesses in the hospitality, accommodation and leisure sector who are not legally closed but who are severely impacted by Tier 2 restrictions in England. These grants can be backdated to August in affected areas.

These businesses will be eligible for cash grants of up to £2,100 per month. The grant figures are based on 70% of the grant amounts (up to £3,000) provided to businesses that are closed.  

The amount affected businesses will be able to claim from their local authority depends on their rateable value:

  • Small businesses with a rateable value of or below £15,000 will be able to claim £934 per month.
  • Medium-sized businesses with a rateable value between £15,000 and £51,000 will be able to claim £1,400 per month.
  • Larger businesses will be able to claim £2,100 per month.

It will be up to Local Authorities to decide exactly which businesses are eligible to receive the grants. Local Authorities will also receive a 5% top up to help other affected businesses.

Source: HM Treasury Thu, 22 Oct 2020 00:00:00 +0100
2824a0c0 33da 4ae2 b618 6ead9418e05d 800x380 - Gaming behind the wheel?

Gaming behind the wheel?

Unbelievably, it has been illegal to make phone calls or text while driving a car, but not illegal to play games or take photos.

Clearly, this loophole is begging to be closed and new legislation proposed, 17 October 2020, will aim to do just that. A Government announcement says:

People using a hand-held mobile phone in all circumstances while driving will be breaking the law, under new Government plans unveiled by Roads Minister Baroness Vere today (17 October 2020) to close a legislation loophole and improve road safety.

It’s already a criminal offence to use a hand-held mobile phone to call or text while driving, but not for other actions such as taking photos. While still distracting, drivers have escaped punishment due to a legal loophole where such actions aren’t seen as ‘interactive communication’, and therefore do not fit the current definition of the offence.

Now, following a review of the offence, a consultation has been launched on bringing the law into line with modern technology – meaning drivers caught taking photos, playing games or scrolling through a playlist behind the wheel will be clearly breaking the law on mobile phone use.

Recognising that mobile phones are commonly used as a method of payment – such as at drive-throughs – an exemption will apply under the new proposals set out by government today to contactless payments, if a vehicle is stationary, and if goods or services – such as a takeaway meal – are delivered immediately.

Source: Other Mon, 19 Oct 2020 00:00:00 +0100
baf70560 79df 4e12 bfc5 3af86641be6b 800x380 - Job Support Scheme Expansion

Job Support Scheme Expansion

On Friday 9 October, the Chancellor, Rishi Sunak announced an extension to the Job Support Scheme (JSS). The expanded scheme will include additional support for employees of businesses that are forced to close because of local or national lockdown measures. The extended scheme will run in parallel with the main JSS for 6 months from 1 November 2020. The scheme rules are due to be reviewed in January 2021.

Under the specific terms of the expanded scheme, the government will pay two-thirds (67%) of employees’ salaries, up to a maximum of £2,100 a month. Employees must be off work for at least 7 consecutive days to benefit from the expanded scheme. When premises re-open the regular JSS rules will apply, whereby employees must work at least one-third of their hours, paid as normal. The government and employer will then each cover one-third of any remaining hours the employee is not working. 

Businesses will only be able to claim the extended grant whilst they are subject to specific lockdown measures that require the closure of their business premises. The expanded scheme will also be available to businesses restricted to delivery or collection services from their premises. However, businesses required to close as a result of specific workplace outbreaks are not eligible for this scheme. 

In line with the main JSS, the grant will be paid in arrears, reimbursing the employer for the government’s contribution. The claim portal will be launched from December 2020 and claims will be paid on a monthly basis. This means that employers will have to use cash reserves or borrow money in order to pay their employees’ wages in advance of receiving the monthly grant. 

Employees of firms that are legally closed in the period before 1 November are eligible for the Coronavirus Job Retention Scheme (CJRS). Interestingly, the new JSS expansion is more generous than the current CJRS, which pays 60% of an employee’s salary up to £1,875 a month.

The JSS grant does not cover Class 1 National Insurance Contributions or pension contributions and employers will have to continue making these contributions. Employers will not be required to contribute towards wages whilst under lockdown measures but can make top up payments if they wish. 

To be eligible for the JSS or JSS expansion, employees must have been registered on their employers PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment in respect of that employee must have been made to HMRC on or before 23 September 2020.

The JSS scheme (including the expansion scheme) is available to businesses that meet the necessary criteria even if they had not previously participated in the CJRS. 

New cash grants

The Chancellor also announced that businesses in England that are forced to shut as a result of lockdown measures will be eligible for grants of up to £3,000 per month, payable every two weeks. Businesses will be eligible to claim after two weeks of closure.

The amount businesses will be able to claim from their local authority depends on their rateable value:

  • Small businesses with a rateable value of or below £15,000 will be able to claim £1,300 per month.
  • Medium-sized businesses with a rateable value between £15,000 and £51,000 will be able to claim £2,000 per month.
  • Larger businesses will be able to claim £3,000 per month.

The government is also extending the scheme to include businesses that have been forced to close on a national rather than a local basis. 

The devolved administrations in Scotland, Wales and Northern Ireland will receive an additional £1.3 billion in guaranteed funding in order to offer similar measures to affected businesses. This takes the additional funding to the devolved administrations this year to at least £14 billion.

Source: HM Treasury Sun, 11 Oct 2020 00:00:00 +0100
bb15fc23 5795 4453 9341 106545f7c67e 800x380 - Grants overclaimed?

Grants overclaimed?

Any business that has overclaimed a Coronavirus Job Retention Scheme (CJRS) grant must pay back the overpayment to HMRC. The rules outlined below for paying HMRC back an overclaim also apply to businesses that would like to make a voluntary repayment because they do not want or need the grant. 

Any overpayments can be corrected in your next claim. If you confirm that your business has been overpaid, the new claim amount will be reduced to reflect this overpayment. You will need to keep a record of this adjustment for six years.

Alternatively, if you are not making another claim under the CJRS then you can request a payment reference number and pay HMRC back within 30 days. This request needs to be made online.

HMRC’s guidance states that if you have overclaimed a grant and have not repaid it, you must notify HMRC by the latest of either:

  • 90 days after the date you received the grant you were not entitled to
  • 90 days after the date you received the grant that you were no longer entitled to keep because your circumstances changed
  • 20 October 2020

Note that the deadline of 20 October 2020 is fast approaching. Late notifications of overclaimed grants could trigger the imposition of penalties. Any claims based on inaccurate information can be recovered by HMRC. However, HMRC has stated that they will not be actively looking for innocent errors in their compliance approach.

Having to repay HMRC is unlikely to be a cost that employers will have thought about, so it is important to ensure that all claims made for furloughed employees are accurate. Employers are required to keep full records relating to any CJRS claims (including adjustments) for a period of six years. 

Source: HM Revenue & Customs Wed, 07 Oct 2020 00:00:00 +0100
a08430b3 de5b 4aa8 b3c7 8c5455e8f55b 800x380 - Claiming the Job Retention Bonus

Claiming the Job Retention Bonus

New guidance has been published on claiming the Job Retention Bonus. The Job Retention Bonus provides for a £1,000 bonus payment to employers that bring back an employee that was furloughed under the Coronavirus Job Retention Scheme, and continuously employs them for at least 3 months after the furlough scheme ends.

The £1,000 Government bonus will be payable for every employee retained under the stated terms. The bonus must be claimed between 15 February 2021 and 31 March 2021. No further claims will be accepted by HMRC after 31 March 2021. 

Employers will still be able to claim the Job Retention Bonus even if they are receiving support from the recently announced Job Support Scheme.

In order to make a claim the employer must have:

  • made an eligible claim for the employee under the Coronavirus Job Retention Scheme
  • kept the employee continuously employed from the end of the claim period of their last Coronavirus Job Retention Scheme claim for them, until 31 January 2021
  • ensured their employee is not serving a contractual or statutory notice period on 31 January 2021 (this includes people serving notice of retirement)
  • paid the employee an amount in each relevant tax month and enough to meet the Job Retention Bonus minimum income threshold. To meet the minimum income threshold the employer must have paid the employee a total of at least £1,560 (gross) between 6 November 2020 and 5 February 2021.

Employers may be able to claim for employees who have transferred to them under TUPE or due to a change of ownership.  To claim the bonus for these employees the employer must have furloughed and successfully claimed for them under the CJRS, as their new employer.

Employers will not be able to claim for employees who transferred after the CJRS closes on 31 October 2020. HMRC’s guidance is due to be updated by the end of January 2021 with details of how to access the online claim service.

Source: HM Revenue & Customs Wed, 07 Oct 2020 00:00:00 +0100
5c720e32 5615 4fec 8813 86bfd91880bf 800x380 - COVID review of salary sacrifice arrangements

COVID review of salary sacrifice arrangements

The tax and NIC advantages of certain benefits provided as part of a salary sacrifice arrangement were removed from 6 April 2017. The change effectively removed the Income Tax and employer NIC advantages of certain benefits provided as part of salary sacrifice arrangements such as mobile phones and workplace parking.

Where these benefit valuation rules apply, the value of the benefit for tax and NIC purposes is the higher of the amount of cash pay given up and the taxable value of the benefit in kind. This is known as optional remuneration arrangements (OpRA).

However, under a transitional plan the old salary sacrifice rules continue until 6 April 2021 for:

  • the provision of a car with emissions of more than 75g CO2/km
  • provided living accommodation
  • the payment of school fees

The new rules will not apply to these types of benefits until 6 April 2021, unless employees vary or renew their arrangements.

An arrangement is not regarded as being varied if the variation of the arrangement is only directly in connection with coronavirus.

Source: HM Revenue & Customs Wed, 07 Oct 2020 00:00:00 +0100