July 02, 2020
Article
Since our last newsletter, the government has updated and introduced additional support for businesses. We are continuing to lobby through Sam’s role with the CLA and through Iain’s role as chair of the national Rural Accountancy Group, particularly for the rural tourism sector, many of which are farming clients have diversified into.
As at 10 June, this is a summary of some of the support available.
Self Employment Scheme
The government announced that they would be extending the Self Employment Income Support Scheme (SEISS) scheme with a second and final grant being payable in August 2020 to assist those who are self employed and still being adversely affected by Coronavirus.
The second SEISS grant will cover the 3 months of June, July, and August and will again be paid in a single installment in August.
The eligibility criteria have changed from the first grant. This will mean that you will need to consider if you meet the scheme requirements more closely.
Unfortunately, the scheme is not being extended to those who commenced self-employment on or after 6 April 2019.
If you are eligible for the first Self Employment Income Support Scheme grant but have not yet submitted your claim, you will need to ensure this is done by the deadline of 13 July 2020
Coronavirus job retention scheme
The job retention scheme has been a lifeline for many businesses and people throughout the last 3 months. The amount we have seen it used by our agricultural clients has been limited. This is mainly as a result of an increase in demand for food and therefore production needing to be at its max.
From 1st July we will see the introduction of the new “flexible furlough scheme”; this scheme changes the message from ‘stay at home’ to ‘get back to work’. For farms with holiday sites and lets this scheme will allow for a part-time return to work, which may be beneficial in the short term.
For those using the scheme there has also been clarity on how the scheme will phase out in the coming months. Over the next few months employers will need to:
- From 1 August, pick up the cost of employer’s NIC/pension costs in full.
- From 1 September, also contribute 10% of the of the Furlough hours pay.
- From 1 September, also contribute 20% of the of the Furlough hours pay.
- On 31 October, the scheme will end.
Cash grants
Both the small business and Retail, Leisure and Hospitality grants are still available. For our farming clients this is mainly relevant to those with Furnished Holiday Lets.
For qualifying business the following levels of grants are available:
- Businesses with a rateable value up to £15,000 will receive a grant payment of £10,000.
- Businesses with a rateable value over £15,000 and less than £51,000 will receive a grant payment of £25,000
Where you have one or more separate property or site that is rateable for business rates you are eligible to one grant per property. It is therefore important to check your paperwork to ensure you have made all claims that are available to you.
Dairy Hardship Fund
With some dairy farmers facing financial difficulties and excess milk due to demand being lower than production, the fund will provide support for those most in need. Eligible dairy farmers will be entitled to up to £10,000 each, to cover 70% of their lost income during April and May to ensure they can continue to operate.
Eligible dairy farmers must have lost more than 25% of their income over April and May due to coronavirus disruptions. There has been no cap set on the number of farmers who can receive this support or on the total funding available.
Deferral of self-employment July payment on account
The government has also allowed the self-employed who are facing cash flow difficulties to defer the July payments on the account until 31 January 2021.
However, care should be taken doing this as it is only a deferral and will, of course, mean that in January a much larger tax bill will arise.
Please do not hesitate to get in contact for a discussion on what Covid 19 Rural Business Support is available.