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Coronavirus

Self assessment POA due 31st July? | Delay it!

Deferring Self Assessment payments on account (POA)

If you are self employed, have property income,  or otherwise asked by HMRC to pay 2 instalments each year towards you personal tax liability, then the next one is due by 31st July.

However, this time you have the option to defer this payment until 31 January 2021.

HMRC has confirmed that there’s no need to let them know either: they will assume the deferral option has been taken if no payment is received.

HMRC has confirmed that it will not charge interest or penalties on the deferred POA, provided it is paid in full by 31 January 2021.

So your options are:
• defer payment of your POA in full up until 31 January 2021
• pay your July POA as normal by 31 July 2020
• pay your POA any time between now and 31 January 2021 (either as one payment or in instalments).

‘Flexible’ Furlough | The ‘HR’ admin

From 1st July, salon owners can bring back employees on a part-time basis and still claim the furlough grant for under the Coronavirus Job Retention Scheme – called CJRS v2.

Here we look at the ‘HR’ admin salon owners need to comply with:

Get it in writing

The salon owner needs each employee’s agreement to come back on a part-time basis and must confirm the arrangement in writing.

The new guidance says a “new” written agreement is needed.

Tax Journal says that:

“It’s not entirely clear if a letter amending an existing furlough agreement will comply or whether a completely new furlough agreement is required. The safest approach is to issue a new furlough agreement which sets out all the terms of flexible furlough.”

Can you change how much part-time they do later on?

Yes you can, since no minimum furlough period is required (under CJRS v1 it had to be a minimum of 3 weeks).

Tax Journal says that:

“The employer can enter into a flexible furlough arrangement with an employee more than once.
However, it’s likely to be administrative cumbersome as the employer would need to issue a “new” flexible furlough agreement each time and document the agreed flexible furlough arrangement.

Keep records of everything for 5 years, and in some cases for 6:

You must keep a written record of the furlough agreement for 5 years.

And you need to keep more information for six years:

(i) the number of actual hours an employee on flexible furlough has worked:

(ii) the number of hours the employee is furloughed (i.e. hours the employee is not working);

(iii) the amount claimed and the claim period for each employee;

(iv) the claim reference number;

(v) the calculations used when preparing claims; and

(vi) the “usual” hours of those on flexible furlough (including the calculations used to reach the figures).

Additionally, it’s suggest making a file note explaining any decisions taken in relation to furloughing employees.

Our thanks to Tax Journal for providing advice above.

‘Flexible’ furlough | which employees are eligible?

From 1st July, salons can bring back employees on a part-time basis and still claim the furlough grant for under the Coronavirus Job Retention Scheme – called CJRS v2.

Here we look at the rules on which employees you can do this with:

  • Only employees you have successfully claimed for under the CJRS v1 (i.e. between 1 March and 30 June) and have been on furlough for at least 3 consecutive during this period.
    • An employee doesn’t need to have been on furlough on 30 June to qualify
    • Remember though that 10 June 2020 was the cut-off date for new entrants to CJRS v1
  • One exception:
    • employees on statutory parental leave (maternity, shared parental, paternity, parental bereavement leave, adoption leave) who return after 10 June can still be furloughed as part of CJRS v2 provided that:
      • (i) they started their period of statutory parental leave before 10 June;
      • (ii) one other employee employed by the employer was furloughed for 3 consecutive weeks before 30 June; and
      • (iii) the returning employee was on the payroll before 19 March.

Scottish Hairdressers and barbers | reopen from Wednesday 15th July

Scotland confirmed:

The First Minister Nicola Sturgeon confirmed today the move to the third phase of lockdown easing in a statement to the Scottish Parliament

Hairdressers and barbers can reopen from Wednesday 15th July subject to enhanced hygiene measures being in place.

Beauticians and nail salons can reopen on 22nd July.

Job Retention Bonus | £1k per employee kept on after furlough

Job Retention Bonus.

Today (8th July 2020) the Chancellor announced the introduction of the Job Retention Bonus.

This is a one-off payment of £1,000 for each employee brought back off the Coronavirus Job Retention Scheme (CJRS) and who remains continuously employed until 31‌‌‌ ‌January 2021.

To be eligible, employees will need to:

  • earn at least £520 per month on average for November, December and January
  • have been furloughed at any point and legitimately claimed for under the Coronavirus Job Retention Scheme
  • have been continuously employed up until at least 31‌‌‌ ‌January 2021.

Salons will be able to claim the bonus from February 2021 (i.e. after your January 2021 PAYE RTI has been submitted).

Mr Sunak said with more than nine million people currently still part of the furlough scheme the new policy could cost the Treasury £9 billion.

More information about this scheme will be available by 31‌‌‌ ‌July and full guidance will be published in the Autumn. In other words, the devil might well be in the detail! But at the moment, it looks a promising additional bit of income for salons.

CJRS v2

Sunak also took the opportunity to confirm that the furlough scheme would definitely finish at the end of its current form “V2” on 31.10.20, saying: “Leaving the furlough scheme open forever gives people false hope that it will always be possible to return to the jobs they had before.”

So basically, you can furlough an employee until the end of October, then need to either bring them back or make them redundant.

NMW/ NLW | and furlough

There’s been quite a bit of confusion over whether you have to pay the National Minimum Wage and National Living Wage (NMW/NLW) to your staff during furlough.

The government has confirmed that:

  • Your staff are entitled to the NMW/NLW when they are “working”.
  • However, when your staff are furloughed, they are not considered as “working” and so are not eligible for the NMW/NLW.
  • It gets trickier from July, where staff can be furloughed part-time:
    • For the time they’re furloughed, there’s no change – they are still not considered as “working” and so are not eligible for the NMW/NLW
    • For the time they are working, they are eligible for the NMW/NLW

We know what you’re thinking. Yes, it’s getting more complicated.

Companies House | extend deadlines

Companies House has temporarily extended a number of deadline – a temporary measure to help during Coronavirus.

(The Companies (Filing Requirements) (Temporary Modifications) Regulations 2020 (‘the regulations’) came into force on 27 June 2020).

Key points that we can see from this for Salon Owners are:

1. Year End Accounts
Companies House has now automatically extended the 9 month deadline to 12 months.

Initially, a 3-month filing extension had been announced from 25 March 2020 but which had to be claimed in advance.

This has now been modified, so from 27 June 2020, filing deadlines are automatically extended until 5 April 2021.

Details of each Company’s new filing deadline will now show on the Companies House website.

2. Confirmation statements
The current 14-day deadline is extended to 42 days.

3. Company Changes
“Event-driven filings” as they’re known (i.e. changes to your company) increase from the current 14-day deadline to 42 days.

Salon opening dates for England & Scotland – no change!

Just to clarify the barrage of misinformation in social media around re-opening dates:

England 
The earliest date salons and barbershops can reopen in England is still 4 July 2020. There has been no other confirmed date.

Scotland
No reopening date yet from Nicole for Scottish salons/barbershops. Still part of phase 3.

Training – all UK
Staff can come to the salon or barbershop for training before reopening but it must be confined to issues such as health & safety and new policies and procedures. For example, how the salon will work on re-opening, the sanitisation workflow etc.

Furloughed staff can take part in the training, but they must receive their normal full wage for this time training – ie 100% rather than 80%.

And to clarify, they do not have to be de-furloughed for the day – they remain technically furloughed.

And of course, social distancing must remain in place during the training.

Pricing for profit | a training session with Orbit Agency & Shine Connect

Many thanks to Diane and Claire of @OrbitAgencyLtd for inviting salonfrog to deliver a webinar training session on how to set salon prices; and the implications after opening post COVID-19 close down.

Really enjoyed it!

To see a recording of the webinar, you’ll need to join the Orbit Agency’s private facebook group :

https://www.facebook.com/groups/ShineConnect

 

Self-Employment Income Support Scheme 2 | scheme extended

Self-Employment Income Support Scheme

The Chancellor has announced plans to extend the Self-Employment Income Support Scheme – SEISS2.

Eligible self-employed people will be able to claim a second and final SEISS grant in August; this will be a taxable grant worth 70% of their average monthly trading profits for three months, paid out in a single instalment and capped at £6,570 in total.

The eligibility criteria for the second grant will be the same as for the first grant. People do not need to have claimed the first grant to claim the second grant: for example, their business may have been adversely affected by COVID-19 (coronavirus) more recently.

Claims for the first SEISS grant, which opened on 13‌‌ May, must be made no later than 13‌‌ July.

Eligible self-employed people must make a claim before that date to receive the first SEISS grant (a taxable grant of 80% of their average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total). So far, we’ve seen over 2.3 million claims worth £6.8 billion.

It’s really important to note that as with the first SEISS grant, the eligible individual must make the claim themselves – their accountants are not allowed to by HMRC.

More information about the second SEISS grant will be available on GOV.‌‌UK on 12‌‌ June.

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