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March 30, 2020 By Andrew Gilpin Leave a Comment

Job Retention Scheme – Update

Dear Payroll Client

We are trying to continue to run our payroll service as best possible in the current situation, with regards to the new changes to employees pay in relation to the job retention scheme we will need you to confirm the following to ensure that we process the correct pay figures to HMRC:-

Do you want us to reduce your employees Salaries to 80% or maintain the 100% payment and the employer pay 20%?

If you do want us to reduce the salary to 80% when is this to commence?

We have set out below an update from HMRC on the Job Retention scheme to explain the claim process and help you with any further questions you may have.

Claim for wage costs through the Coronavirus Job Retention Scheme

The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers for at least three months starting from 1 March 2020. We expect the scheme to be up and running by the end of April. It is designed to support employers whose operations have been severely affected by coronavirus (COVID-19).

Employers can use a portal to claim for 80% of furloughed employees’ (employees on a leave of absence) usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage. Employers can use this scheme anytime during this period.

The scheme is open to all UK employers that had created and started a PAYE payroll scheme on 28 February 2020.

Who can claim

Any UK organisation with employees can apply, including:
Businesses
Charities
Recruitment agencies (agency workers paid through PAYE)
Public authorities
You must have created and started a PAYE payroll scheme on or before 28 February 2020 and have a UK bank account.
Where a company is being taken under the management of an administrator, the administrator will be able to access the Job Retention Scheme.

Employees you can claim for

Furloughed employees must have been on your PAYE payroll on 28 February 2020, and can be on any type of contract, including:

Full-time employees
Part-time employees
Employees on agency contracts
Employees on flexible or zero-hour contracts

The scheme also covers employees who were made redundant since 28 February 2020, if they are rehired by their employer.

To be eligible for the subsidy, when on furlough, an employee can not undertake work for or on behalf of the organisation. This includes providing services or generating revenue. While on furlough, the employee’s wage will be subject to usual income tax and other deductions.

This scheme is only for employees on agency contracts who are not working.

If an employee is working, but on reduced hours, or for reduced pay, they will not be eligible for this scheme and you will have to continue paying the employee through your payroll and pay their salary subject to the terms of the employment contract you agreed.

Employers should discuss with their staff and make any changes to the employment contract by agreement. When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.

To be eligible for the subsidy employers should write to their employee confirming that they have been furloughed and keep a record of this communication.

Employees hired after 28 February 2020 cannot be furloughed or claimed for in accordance with this scheme.

You do not need to place all your employees on furlough. However, those employees who you do place on furlough cannot undertake work for you.

If your employee is on unpaid leave

Employees on unpaid leave cannot be furloughed, unless they were placed on unpaid leave after 28 February.

If your employee is on Statutory Sick Pay

Employees on sick leave or self-isolating should get Statutory Sick Pay, but can be furloughed after this.

Employees who are shielding in line with public health guidance can be placed on furlough.

If your employee has more than one job

If your employee has more than one employer they can be furloughed for each job. Each job is separate, and the cap applies to each employer individually.

If your employee does volunteer work or training

A furloughed employee can take part in volunteer work or training, as long as it does not provide services to or generate revenue for, or on behalf of your organisation.

However, if workers are required to for example, complete online training courses whilst they are furloughed, then they must be paid at least the NLW/NMW for the time spent training, even if this is more than the 80% of their wage that will be subsidised.

If your employee is on Maternity Leave, contractual adoption pay, paternity pay or shared parental pay

Individuals who are on or plan to take Maternity Leave must take at least 2 weeks off work (4 weeks if they work in a factory or workshop) immediately following the birth of their baby. This is a health and safety requirement. In practice, most women start their Maternity Leave before they give birth.

If your employee is eligible for Statutory Maternity Pay (SMP) or Maternity Allowance, the normal rules apply, and they are entitled to claim up to 39 weeks of statutory pay or allowance.

Employees who qualify for SMP, will still be eligible for 90% of their average weekly earnings in the first 6 weeks, followed by 33 weeks of pay paid at 90% of their average weekly earnings or the statutory flat rate (whichever is lower). The statutory flat rate is currently £148.68 a week, rising to £151.20 a week from April 2020.

If you offer enhanced (earnings related) contractual pay to women on Maternity Leave, this is included as wage costs that you can claim through the scheme.

The same principles apply where your employee qualifies for contractual adoption, paternity or shared parental pay.

Work out what you can claim

Employers need to make a claim for wage costs through this scheme.

You will receive a grant from HMRC to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage. Fees, commission and bonuses should not be included.

At a minimum, employers must pay their employee the lower of 80% of their regular wage or £2,500 per month. An employer can also choose to top up an employee’s salary beyond this but is not obliged to under this scheme.

We will issue more guidance on how employers should calculate their claims for Employer National Insurance Contributions and minimum automatic enrolment employer pension contributions, before the scheme becomes live.

Full time and part time employees

For full time and part time salaried employees, the employee’s actual salary before tax, as of 28 February should be used to calculate the 80%. Fees, commission and bonuses should not be included.

Employees whose pay varies

If the employee has been employed (or engaged by an employment business) for a full twelve months prior to the claim, you can claim for the higher of either:

The same month’s earning from the previous year

Average monthly earnings from the 2019-20 tax year

If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work.

If the employee only started in February 2020, use a pro-rata for their earnings so far to claim.

Once you’ve worked out how much of an employee’s salary you can claim for, you must then work out the amount of Employer National Insurance Contributions and minimum automatic enrolment employer pension contributions you are entitled to claim.

Employer National Insurance and Pension Contributions

All employers remain liable for associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on behalf of their furloughed employees.

You can claim a grant from HMRC to cover wages for a furloughed employee, equal to the lower of 80% of an employee’s regular salary or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on paying those wages.

You can choose to provide top-up salary in addition to the grant. Employer National Insurance Contributions and automatic enrolment contribution on any additional top-up salary will not be funded through this scheme. Nor will any voluntary automatic enrolment contributions above the minimum mandatory employer contribution of 3% of income above the lower limit of qualifying earnings (which is £512 per month until 5th April and will be £520 per month from 6th April 2020 onwards).

National Living Wage/National Minimum Wage

Individuals are only entitled to the National Living Wage (NLW)/National Minimum Wage (NMW) for the hours they are working.

Therefore, furloughed workers, who are not working, must be paid the lower of 80% of their salary, or £2,500 even if, based on their usual working hours, this would be below NLW/NMW.

However, if workers are required to for example, complete online training courses whilst they are furloughed, then they must be paid at least the NLW/NMW for the time spent training, even if this is more than the 80% of their wage that will be subsidised.

What you’ll need to make a claim

Employers should discuss with their staff and make any changes to the employment contract by agreement. Employers may need to seek legal advice on the process. If sufficient numbers of staff are involved, it may be necessary to engage collective consultation processes to procure agreement to changes to terms of employment.

To claim, you will need:

Your ePAYE reference number

The number of employees being furloughed

The claim period (start and end date)
Amount claimed (per the minimum length of furloughing of 3 weeks)
Your bank account number and sort code
Your contact name
Your phone number

You will need to calculate the amount you are claiming. HMRC will retain the right to retrospectively audit all aspects of your claim.

Claim

You can only submit one claim at least every 3 weeks, which is the minimum length an employee can be furloughed for. Claims can be backdated until the 1 March if applicable.

What to do after you’ve claimed

Once HMRC have received your claim and you are eligible for the grant, they will pay it via BACS payment to a UK bank account.
You should make your claim in accordance with actual payroll amounts at the point at which you run your payroll or in advance of an imminent payroll.
You must pay the employee all the grant you receive for their gross pay, no fees can be charged from the money that is granted. You can choose to top up the employee’s salary, but you do not have to.

When the government ends the scheme

When the government ends the scheme, you must make a decision, depending on your circumstances, as to whether employees can return to their duties. If not, it may be necessary to consider termination of employment (redundancy).

Employees that have been furloughed

Employees that have been furloughed have the same rights as they did previously. That includes Statutory Sick Pay entitlement, maternity rights, other parental rights, rights against unfair dismissal and to redundancy payments.
Once the scheme has been closed by the government, HMRC will continue to process remaining claims before terminating the scheme.

Income tax and Employee National Insurance

Wages of furloughed employees will be subject to Income Tax and National Insurance as usual. Employees will also pay automatic enrolment contributions on qualifying earnings, unless they have chosen to opt-out or to cease saving into a workplace pension scheme.
Employers will be liable to pay Employer National Insurance contributions on wages paid, as well as automatic enrolment contributions on qualifying earnings unless an employee has opted out or has ceased saving into a workplace pension scheme.

Tax Treatment of the Coronavirus Job Retention Grant

Payments received by a business under the scheme are made to offset these deductible revenue costs. They must therefore be included as income in the business’s calculation of its taxable profits for Income Tax and Corporation Tax purposes, in accordance with normal principles.Businesses can deduct employment costs as normal when calculating taxable profits for Income Tax and Corporation Tax purposes.

June 2, 2020 By Des Ingham Leave a Comment

Claiming Back Statutory Sick Pay Payments

From May 26th employers could register to claim back certain Statutory Sick Payments (SSP). You can make the claim using the online service using your ID number from when you registered for PAYE online. If you haven`t registered for the PAYE online service yet you will need to do so if you wish to make a claim.

There are alternative ways to make a claim if you do not want to, or can`t, claim online, but the online service is very easy to use, and you can also get an agent to claim on your behalf.

What Information You Need To Make A Claim

Here are the things you will need if you wish to make a claim for SSP payments:

Your PAYE reference number from when you registered online.
Details of your bank account where you can accept BACS payments to.
A contact name and telephone number where they can contact you if they have any queries about the claim.
The total amount of SSP you have paid out to your employees since the Covid-19 pandemic broke out and the scheme was launched.
The total number of employees that you are putting in a claim for.
The start and end date of the claim period. The start date of your claim is the start date of the earliest pay period you are claiming for and the end date of your claim is the end date of the most recent pay period. you are claiming.

The Importance Of Keeping Records

The above shows the importance of keeping records of all the SSP you have paid out over the claim period if you want to claim this money back. As with everything in business, records of all financial activities are essential to be on top of all the work, keep a tight ship and be in a position to grow your business in a safe and secure manner. The most successful businesses know their incomings and outgoings on a weekly basis and are therefore able to plan accordingly.

For SSP purposes you will need records of the dates any employee was off sick, which of those days were actually qualifying days to claim back the money, the reason why they were off work sick, and the employee`s National Insurance number.

A Partner Who Will Give You Sound Business Advice

If you need an agent to sort out your SSP, or an accountant to help secure and grow your business over the coming weeks and months, and who will partner with you to ensure you get the very best financial help and advice, we are here to help you.

WHR Accountants have a wealth of knowledge and experience in helping both large, medium and small business enterprises realise their potential. If you need a reliable, professional accountancy team right now with an unrivaled reputation in the business please get in touch with the team by giving us a call on 028 3752 2909, we would very much like to hear from you.

June 1, 2020 By Des Ingham Leave a Comment

Easing Of Lockdown Sees Shops Beginning To Open

Here we are on June 1st 2020 and today is the day when such businesses as outdoor markets and car showrooms are being allowed to open again now lockdown is being slowly eased.

Outdoor Markets & Car Showrooms Opening Today

Outdoor markets and car showrooms have been chosen first as they are businesses where it is easier to adhere to the social distancing guidelines. And as Covid-19 is a lot less likely to be caught out in the open air then it makes sense that outdoor markets should be one of the first non-essential businesses to reopen.

Big concerns such as Marks & Spencer and Ikea have confirmed that they are opening up their stores, saying that they are laying down strict social distancing measures, with areas such as clothes fitting and make-up remaining closed in M&S for the time being.

Businesses Must Be Covid Secure

However most high street shops, department stores and shopping centres will have to wait a further two weeks before they open for business on June 15th, providing of course there isn`t a steep increase in the number of infections between now and then. Also all businesses that do reopen will have to prove that they are Covid-secure and have taken all the necessary steps to prevent infection being passed around on their premises.

It will not be until at least July that businesses such as pubs, restaurants, clubs, hairdressers, nail bars and beauty salons can open once again, these being the type of places where social distancing can be quite a challenge.

Businesses Must Get Back To Some Sort Of Normality

Of course these have certainly been challenging times for all businesses. Now the furlough scheme has been given an end date by the Chancellor in October, with a scaling down of payments by the government up to that time, it is vital that businesses can reopen and get back to some sort of normality as soon as possible. If they don`t then the possibility of wide scale redundancies is very much on the cards. This is very much make or break time for so many businesses, large and small.

As ever we are here to provide expert advice and support during this rocky time. If you need any advice on grants or loans which may be available for your business, or you need help with your short, medium and long term business plan then get in touch with our team here at WHR Accountants by ringing 028 3752 2909.

May 30, 2020 By Des Ingham Leave a Comment

The End Of The Furlough Scheme & Extension Of The Self-Employment Income Support Scheme

There has been lots of news to keep up with over the last few days with the most important snippets being the announcement by the Chancellor Rishi Sunak that the furlough scheme will end once the October payments are made, along with news on a final grant for the self employed in August.

Furlough Scheme Extended Into October

Although the furlough scheme is being extended into October employers will find that they will be contributing more towards keeping their employees furloughed each month. There will also be some flexibility within the furlough scheme in July aimed at part-time employees.

It is also worth noting that employers will have to place any new employees on the furlough scheme before June 10th which is less than 2 weeks away.

How The Furlough Scheme Tapers Off Into October

Here are some details on how the furlough scheme will pan out over the next few months, these details have been copied from the Mortgage Solutions website:

“In June and July the government will pay 80 per cent of wages up to a cap of £2,500 as well as employer National Insurance (NICs) and pension contributions. Employers are not required to pay anything.

“In August the government will pay 80 per cent of wages up to a cap of £2,500. Employers will pay employer NICs and pension contributions. Treasury said for the average claim, this represented five per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.

“In September, government will pay 70 per cent of wages up to a cap of £2,187.50. Employers will pay employer NICs and pension contributions and 10 per cent of wages to make up 80 per cent total up to a cap of £2,500. Treasury added that for the average claim, this represented 14 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.

“Finally, in October government will pay 60 per cent of wages up to a cap of £1,875. Employers will pay employer NICs and pension contributions and 20 per cent of wages to make up the 80 per cent total up to a cap of £2,500. For the average claim, this will be around 23 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.”

Self Employment Income Support Scheme Grant

As for the Self Employment Income Support Scheme those people who are eligible will be able to access a second and final grant which will be capped at £6,750 in August.

For more help and advice on the latest government measures and how it will affect you and your business get in touch with the WHR Accountancy team by calling us on 028 3752 2909.

May 26, 2020 By Des Ingham Leave a Comment

NI Micro-business Hardship Fund

The Northern Ireland Executive has recently launched the NI Micro-business Hardship Fund in an effort to aid Northern Ireland based micro-businesses and also social enterprises during these unprecedented times. This fund is for those businesses who are unable to access other Covid-19 support measures.

Access The Online Eligibility Checker

To find out more about this fund and to access an Online Eligibility Checker to find out if you are one of the businesses that can apply for this fund go to the NI Business Info website.

Here is a snippet from the website giving a summary of the scheme along with details on who is eligible to apply:

Summary Of The Scheme

“The funding is available to businesses unable to access the £10,000, £25,000 and Covid-19 Childcare Support grant schemes.

In order to ensure that the £40 million budget is not exceeded, the final amounts awarded will depend on the number of successful applications.

The level of Hardship Fund grant will be up to £10,000 for businesses which pay business rates on premises and up to £5,000 for those that do not pay business rates. Businesses within each category will receive the same amount.

Only one grant will be paid to each eligible business, irrespective of how many properties the business occupies.

Eligibility – Who Is Eligible

Businesses should ensure they meet the following criteria before applying to the fund:

-The business must be based in Northern Ireland.
-At 29 February 2020, the business must have employed between one and nine employees paid via PAYE. Businesses, where the sole employee is the business owner or company director, are not eligible for this scheme. The number of employees will be based on headcount.
-Since 1 March 2020, the business must have experienced a reduction in turnover in excess of 40% as a direct result of the COVID-19 pandemic or associated Government restrictions.”

We hope the above information proves useful to you. We keep a track on all the various grants and funds available to businesses both large and small so if you want to know what may be available to your business please get in touch with us here at WHR Accountants. We can also help you with any other accountancy related issues if required.

May 25, 2020 By Des Ingham Leave a Comment

Starting Up Your Business After Lockdown

We are writing this blog on Bank Holiday Monday, August 25th, so the vast majority of businesses are closed in Northern Ireland and across the UK. But there is no doubt that a lot of businesses will be making the first tentative steps to opening again tomorrow, if they have not already done so.

Entrepreneurial Spirit To The Fore

This doesn`t include the hospitality industry of course, and pubs, cafes and restaurants will be some of the last to open again, although some are doing their best to run a takeaway or delivery service for their customers. The entrepreneurial spirit is certainly coming to the fore and businesses are using their initiative and imagination to find ways of trading once again.

There is a fine balance between getting the economy moving again but also keeping everyone safe from catching Covid-19. But it is one that we have to find and fast if we are not going to suffer the loss of thousands and thousands of jobs, which will in turn lead to financial hardship for many people here in Northern Ireland.

Most Countries In Europe Coming Out Of Lockdown

Most countries in Europe are now in the same position and are beginning to come out of lockdown slowly but surely. This is now a very critical time as we will find out in the next few weeks if we have another peak with a huge rise in the number of people infected, or we can control the rise to a manageable level.

Of course we have already seen the folding of some businesses as they have found that they just have too many overheads to cope with the shutdown of their business during this period, which is a very sad state of affairs. There are many other businesses teetering on the edge of going into administration too. These companies need to get back to some sort of working normality as soon as is humanly possible. There is a lot of talk of the new normal now which is something which we are going to have to live with for the foreseeable future.

If you have a business in Northern Ireland and you are looking at getting back to work in the next few days and weeks, or you have already done so, you may need some help negotiating your way through these testing times.

Grants & Business Plans

At WHR Accountants we can help you in a number of areas. These include advice on how to start up your business after lockdown, advice on grants and funds which may be available to you, help with compiling a business plan to get you through the next few months, and of course help with your accounts going forward.

If you would like to get in touch with us for an initial chat please give our offices a ring on 028 3752 2909. Stay safe and we hope to hear from you soon.

May 19, 2020 By Des Ingham Leave a Comment

Guidance For Employers On Going Back To Work

As many businesses are now starting to turn their attention towards going back to work, if they have not already done so, we thought we would share with you the new Covid-19 guidelines which have been issued by the government on what needs to be put in place for both the workplace and the workforce in order to proceed back to work as safely as possible.

This information has been taken from the Accountancy Daily website which says that:

“The Department for Business, Energy and Industrial Strategy (BEIS) said the information has been developed with input from firms, unions, industry bodies and the devolved administrations in Northern Ireland, Scotland and Wales and in consultation with Public Health England (PHE) and the Health and Safety Executive (HSE).

The new guidance covers eight workplace settings which are allowed to be open, from outdoor environments and construction sites to factories and takeaways.

5 Key Points To Be Implemented

The five key points, which should be implemented ‘as soon as practical’ and which cover all settings are:

Work from home, if you can

All reasonable steps should be taken by employers to help people work from home. But the guidance makes clear that those who cannot work from home and whose workplace has not been told to close should go to work.

Carry out a Covid-19 risk assessment, in consultation with workers or trade unions

This guidance operates within current health and safety employment and equalities legislation and employers will need to carry out Covid-19 risk assessments in consultation with their workers or trade unions, to establish what guidelines to put in place. If possible, employers should publish the results of their risk assessments on their website and the government expects all businesses with over 50 employees to do so.

Maintain two metres social distancing, wherever possible

Employers should re-design workspaces to maintain two metre distances between people by staggering start times, creating one way walk-throughs, opening more entrances and exits, or changing seating layouts in break rooms.

Where people cannot be two metres apart, manage transmission risk

Employers should look into putting barriers in shared spaces, creating workplace shift patterns or fixed teams minimising the number of people in contact with one another, or ensuring colleagues are facing away from each other.

Reinforcing cleaning processes

Workplaces should be cleaned more frequently, paying close attention to high-contact objects like door handles and keyboards. Employers should provide handwashing facilities or hand sanitisers at entry and exit points.”

Our Dedicated Accountancy Team

We hope the above information proves useful to you and if you need any guidance with regards to a business plan or financial advice to help you through the tough months ahead don`t hesitate to call our dedicated team here at WHR Accountants on 028 3752 2909.