As you know, lockdown is now easing, and in July some businesses such as retailers, hairdressers and restaurants will be re-opening gradually. If you usually work in an office environment, you may be able to go back to work there if you can do so safely.
The announcements regarding financial support for sole traders and the self-employed have now all been announced. We have written this article to summarise critical areas that you need to know about as move back to resuming operational delivery of your business.
Self-employment Income Support Scheme (SEISS)
This scheme was set up for businesses that were adversely affected by the coronavirus pandemic. You can claim up to 80% of your average monthly trading profits. If you have not already claimed the first grant, then you must make sure you make a claim before Monday 13 July 2020.
As the scheme is being extended, businesses that are still adversely affected after 14 July 2020 will be able to claim in August 2020. Even if you did not claim the first grant, you could claim during this second phase. You should be contacted directly by HMRC if you don't then speak to your accountant for advice.
Self-employment and Universal Credit
You can claim Universal Credit if you cannot operate at all or if you are only partially working and your income is very low. When you claim Universal Credit, you need to complete a monthly assessment which covers how much you earned, if you paid into a pension and other information about your business. If you are eligible for the SEISS grant, then it will affect your Universal Credit payments.
Paying your tax bill
All Payment on Account (PoA) tax bills usually paid in July have been deferred to 31 January 2021. You can make the payment in July if you have the funds. If not, you do not need to take action as the deferral is automatic for everyone.
However, it is worth checking that you will have the funds to pay your tax bill in January next year. If you think you will struggle, it's essential to contact the HMRC as soon as possible and discuss your options.
VAT payments
If you are VAT-registered, you know that the VAT bill due between 20 March 2020 and 30 June 2020 was deferred to help businesses with cash flow. It is important to note that the VAT payment deferral period ends on 30 June 2020 so you must ensure that future VAT bills are paid on time.
The payment which was deferred needs to be paid in full by 31 March 202. So check that you have a financial forecast in place to make this payment by this date if not before.
We know that it will take many months if not longer for some businesses to return to trading at the same level as they were before the Coronavirus pandemic. If you need any advice at all about the schemes explained above. Or if you want help with developing a cash flow forecast, please do get in touch.
You can call 01623 490 120 or email