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April 1, 2020 By Des Ingham Leave a Comment

Keeping Your Business Afloat During The Coronavirus Pandemic

As we write this blog article the coronavirus has taken an ever more deadly grip on the world. The death toll is growing higher, particularly here in Europe and the United States, and many other countries could soon follow suit. We hope you are well, staying safe and ensuring that everyone around you is safe and healthy as well.

Keeping The Economy Ticking Over

It seems churlish in a way to talk about business, but the fact of the matter is that all our businesses help to keep the economy and trade ticking over, helping to feed, service and connect with the rest of the world.

Once this terrible pandemic passes we need as many businesses as possible to still be solvent so that they can build up their company again and get the economy moving, which is exactly what we will need once we get back to some form of normality.

We all know that this isn`t straightforward, all businesses still have to pay most of their overheads, but with little or no money coming in.

Business Advice In Uncertain Times

At WHR Accountants we help businesses negotiate their way through uncertain times so if there is any help or advice that you need you can get in touch. Whether you have some questions about the new regulations that have come into force, what grants there may be available to apply for, how you stand with your employees and what you can do to help them, or just a general plan of action, email our offices at info@whraccountants.co.uk and we will be glad to offer our assistance.

Thriving Economy In Northern Ireland

It is vitally important that we don`t throw in the towel but instead do our utmost to stay strong until it is safe to open our doors again. At the moment it feels like the coronavirus pandemic will never pass, but eventually it will so we need to be ready to get things moving so that Northern Ireland will have a thriving economy.

Stay safe, from all the team at WHR Accountants.

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.

March 23, 2020 By Des Ingham Leave a Comment

VAT Payments Are Deferred

It has been announced today, March 23rd, that HMRC are deferring VAT payments for all businesses in the UK for a period of 3 months up to June 30th of this year. This is of course to lessen the load for businesses who are being badly affected by the coronavirus pandemic.

The VAT Deferral Is Automatic

This VAT deferral applies from March 20th through to June 30th and the deferral will be automatic for all businesses, so there is no need to apply for this, you just don`t 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.

Great Period Of Uncertainty For Businesses

This is a welcome measure for businesses but there is no doubt that there is a great deal more to be done if many businesses are going to survive this huge period of upheaval whilst we are in the midst of the coronavirus pandemic. One of the worst things about this situation is the uncertainty of it all, nobody knows how long cafes, restaurants and pubs will be closed for, or if other businesses will soon follow suit and be ordered to close.

Most businesses are just taking it day by day at the moment as they just don`t know what will happen next, but because of this business to business sales have plummeted which has impacted enormously on the economy.

Tax & Financial Advice

We are of course here to offer as much help and advice as we can, so if you would like to discuss your current financial situation and tax issues etc with us just pick up the phone. We are not doing any face to face meetings but we can talk over the phone, our number is 028 3752 2909.

Meanwhile please stay safe, stay indoors if you possibly can, but if you do go out keep a good distance from your fellow humans to protect both yourself and everyone else.

March 19, 2020 By Des Ingham Leave a Comment

New Working Practices In Light Of The COVID-19 Threat

We are writing this blog to keep you up to date on the new working practices we are putting in place to ensure we keep both customers and staff as safe as possible whilst the threat of the Coronavirus hangs over us all.

Telephone Based Service

In light of this threat we, WHR Accountants Ltd, have taken the decision to work normal hours but behind closed doors. With immediate effect we have changed our office to telephone based in order to protect both our staff and our clients.

If you need to provide us with your records, please contact reception and arrangements will be put in place. We will continue to monitor the situation and update you of any further change.

Thank you for your cooperation at this difficult time but we are sure you understand the situation. There is nothing more important as people`s health so if we can do our bit to keep everyone safe we are happy to do so.

Exactly The Same Level Of Service

Rest assured you will get the same level of service from our accountancy team as you always do, it`s just we will be communicating with people by phone rather than face to face. The threat to all of us from the COVID-19 virus is very real indeed and we believe that everyone should be doing their bit to ensure that we are not at risk of passing on this virus to anyone who may be particularly vulnerable if they contract it.

So if you want to contact us, if you are either a client or you are interested in using our services, please give our offices a call here in Armagh on 028 3752 2909 and we will be only too happy to help you.

We would like to take this opportunity to say thank you to all our clients, if you need any financial advice during this uncertain period of time please don`t hesitate to get in touch. We hope you all stay safe.

March 17, 2020 By Des Ingham Leave a Comment

Why An Audit Can Be Beneficial For Your Business

Many businesses think that having an audit of their business once a year is a necessary evil and if they had the choice they wouldn`t bother with one. What they are failing to realise is that an audit can be extremely beneficial to a business if carried out efficiently.

Keeping Compliant

In order to remain compliant and meet all the statutory and regulatory requirements in any particular industry businesses must have an audit. This gives all interested parties peace of mind that the business is being run correctly and there are no issues that could come back to bite them in the future.

Verification For The Business

An audit gives credibility to a business that everything is in order as it gives independent verification from a third party that the financial statements have been true and all is as it should be. This confidence in the business is worth its weight in gold.

Audits Can Suggest More Efficient Methods

When an in-depth audit is done the auditors look at all a businesses systems and controls, which can often throw up opportunities to improve the methods that are being used to a more efficient and effective process. Areas that auditors can find ways to improve efficiency in can include business systems, accounting practices, internal controls and the business culture and organisation that is prevalent at the time. Changes in one or two of the above can invariably lead to great increases in productivity.

Help To Devise An Improved Business Plan

During an audit the revenue, expenditure, assets and liabilities of a business are all put under the microscope. Experienced auditors can examine these and often come up with advice that can help businesses produce an improved business plan that will help their business manage their finances and encourage growth in the future.

Preventing Fraudulent Behaviour

It is an unfortunate fact that fraudulent activity by employees can still be an issue for some businesses. The good news is that a comprehensive audit can discover any discrepancies and nip this type of behaviour in the bud before it gets too serious. A good auditor can also find weak areas in a business that could be exploited and they can provide advice on how to strengthen those areas so that no issues can occur.

WHR Accountants Auditing Team

At WHR Accountants we have an experienced and skilled auditing team that can help any business large or small with their auditing. For more details on our services please get in touch with us by giving our offices a call on 028 3752 2909.

March 16, 2020 By Des Ingham Leave a Comment

Budget 2020 & Its Impact On Businesses

The Budget delivered by new Chancellor of the Exchequer Rishi Sunak last week was certainly a head turner, as the Conservatives didn`t just loosen the purse strings, they tipped the purse upside down and squeezed as much money as they could out of the coffers.

Measures To Lessen Impact Of Coronavirus

There were two reasons for this. One was that they needed to deliver on some of the promises that they made in the run up to the General Election, and two, and probably a lot more importantly, they needed to bring in measures that would lessen the impact of the coronavirus which looks like it will envelop our shores in the near future.

UK Businesses Promised £30bn In Support

The Chancellor promised UK businesses £30bn in an effort to provide them support and lessen the impact that the virus is going to have on businesses and the overall economy. £12bn of this would be for direct support to businesses and a further £18bn would be used to counteract the temporary downturn in the economy.

Here are some of the major changes relating to businesses as quoted on the Accounting Web website:

“The specific coronavirus Budget measures include:

Extended statutory sick pay entitlement from day one (previously announced), to be refunded in full by the government. “That could provide over £2bn for up to 2m businesses,” the Chancellor said.
Extended time to pay arrangements allowing businesses and the self employed to defer tax payments.
A £500m hardship fund for local authorities to distribute to vulnerable people in their areas.
Coronavirus business interruption loan scheme, offering an extra £1bn in overdrafts and short-term loans through the British Business Bank.
Business rates holiday
The Chancellor brushed up his business-friendly credentials by announcing a 100% business rates discount for 12 months starting from 1 April 2020. The holiday would be extended to any eligible retail, leisure or hospitality business with a rateable value below £51,000.

The £1,500 business rates discount for office space used by local newspapers in England will also be extended for five more years until 31 March 2025 and the government promised to bring forward legislation to provide 100% business rates relief for public lavatories in England from April 2020.

Local authorities will be fully compensated for the loss of income as a result of these temporary business rates measures, but the long awaited “fundamental review of business rates” will now get underway and report in the autumn.

Entrepreneurs Relief

Among the many Tory manifesto commitments to get a name check during the Budget speech was entrepreneurs’ relief. In AccountingWEB’s live Budget blog, PracticeWeb contributor Carl Powell predicted: “They’re going to do something, but it will probably be a fudge.”

And so it came to pass. The long-trailed crackdown took the form of a reduction in the £10m lifetime limit on eligible gains to £1m, effective immediately. The move would leave 80% of small businesses unaffected by the changes and save £6bn over the next five years, the Chancellor said.

Corporation Tax

Few surprises here, with the standard rate of corporation tax held at 19% for the financial years commencing 1 April 2020 and 2021, as already announced. There will be new restrictions in place from 1 April 2020 on how much chargeable gains companies can offset against brought forward capital losses. From that date only 50% of net chargeable gains may be sheltered , subject to the allocation of a company’s (or group’s) £5m annual ‘deductions allowance’.

The Research and Development Expenditure credit will be increased from 12 to 13% – a tax cut worth £2,400 on a typical R&D claim. There have been calls for tighter controls on what has become a popular concession, but the Chancellor signalled a more relaxed short-term approach, delaying a cap SME relief for a year and promising further consultation. The discussions will include whether or not data and cloud computing initiatives will be eligible for R&D relief claims.

The structures and buildings allowance will be increased from 2 to 3%, giving an extra £100,000 of relief if you’re investing in a building worth £10m.

For companies operating in enterprise zones, 100% enhanced capital allowances (ECAs) on plant and machinery expenditure will be extended until at least 31 March 2021. The allowances were due to lapse on 31 March 2020, but will now survive for at least one further year.”

If you have a business and you need help to steer through the choppy waters of the next few months, here at WHR Accountants we can provide you with expert support on general accounting, taxation, funding, payroll, business plans, auditing and much more. For more details please get in touch with our team by giving us a call on 028 3752 2909.