July Newsletter

July Newsletter

 

“FLEXIBLE FURLOUGH” STARTS 1 JULY

From 1‌‌ July the new CJRS “Flexible furlough” grant scheme starts, which will allow employers to gradually bring their furloughed employees back to work part-time. The new scheme will be in place until the end of October and the Government will gradually reduce the amount of grant towards employees’ furlough pay to 70% in September and 60% in October.

The grant paid by the Government via HMRC will remain at 80% of the employee’s normal pay for July and August but they will stop reimbursing NICs and pension contributions from 1 August 2020.

Further details on the operation of the new scheme were announced on 12 June 2020 which are summarised below.

KEY CONDITIONS FOR NEW “FLEXIBLE FURLOUGH”

Only those employees who have been furloughed and included in a claim under the original CJRS scheme may be included in a claim for the new flexible furlough.

That means they must have been furloughed on or before 10 June to allow a full 21 days prior to the end of the original scheme.

A further restriction is that the maximum number of employees that can be included in a flexible furlough claim cannot exceed the maximum number included in a claim under the original scheme. Thus if the employer has 8 employees split into teams of 4 and furloughed team A for three weeks and then team B for 3 weeks the maximum number of employees that can be included in a flexible furlough claim will be limited to 4.

Unlike the original CJRS furlough scheme there is no minimum furlough period as the intention is to allow employers the flexibility to gradually bring employees back to work. The hours/days worked will need to be agreed between employee and employer which is likely to involve amending the employees’ contracts.

Employees will be entitled to their normal contractual pay for the hours that they work and must be paid at least 80% of their normal pay for the hours that they are furloughed, even when HMRC are only reimbursing 70% or 60%.

Employers will need to notify HMRC of the employee’s usual hours and the hours worked in the claim period. The furloughed hours will be the difference. This will be complicated where the employee’s hours vary. There is currently a lack of clarity in the HMRC guidance on the calculation of “usual hours” and we will of course be available to assist you in making your claim. We will also be able to make the claims on your behalf.

Each claim made by an employer must be for a week or more and no claim period can straddle a calendar month end.

Like the original furlough scheme claims cannot be made more than 14 days in advance.

The first claims under flexible furlough can be made from 1 July and the deadline for claims under the original CJRS for the period to 30 June is 31 July 2020.

DIARY OF MAIN TAX EVENTS

July/August 2020

Date

What’s Due

01/07

Corporation tax for year to 30/9/19 (unless pay quarterly)

05/07

Last date for agreeing PAYE settlement agreements for 2019/20 employee benefits

05/07

Deadline for agents and tenants to submit returns of rent paid to non-resident landlords and tax deducted for 2019/20

06/07

Deadline for forms P11D and P11D(b) for 2019/20 tax year. Also deadline for notifying HMRC of shares and options awarded to employees.

19/07

PAYE & NIC deductions, and CIS return and tax, for month to 5/7/20 (due 22/07 if you pay electronically)

31/7

50% payment on account of 2020/21 tax liability due. However, due to Covid-19 all taxpayers may defer the payment until 31/1/21 without incurring interest and penalties.

01/08

Corporation tax for year to 31/10/19 (unless pay quarterly)

19/08

PAYE & NIC deductions, and CIS return and tax, for month to 5/8/20 (due 22/08 if you pay electronically)


Helping your employees feel safe as they go back to the workplace

As we emerge from lockdown and return to the workplace, managers will need to ensure that employees feel safe.

Over the coming weeks and months, many businesses will return to some form of normal operations. This means that staff will begin to return to offices, factories and other places of work. Managers will need to help their people back into their work routine.

It’s only natural that employees will feel uneasy about going back to their place of work. Employers can help by keeping up to date with the latest government guidelines. These guidelines should be communicated to all staff on a regular basis so that everyone is aware of the relevant policies and procedures. This in itself can help to calm people’s nerves as it demonstrates that the firm is implementing the latest health and safety recommendations and is taking their wellbeing seriously.

As ever, communication is key. Managers should have open conversations about personal protective equipment (PPE), respecting social distancing guidelines, etc. Some employees may have different views on what safety precautions are necessary in the workplace. As such, the management team should create appropriate training materials and deliver training to all staff so that everyone knows what is required of them. It is important to remind everyone that they have a responsibility to others and that if everyone follows the guidelines, then risks to staff and customers will be minimized.

Business premises should be set up to comply with social distancing guidelines. This may include setting out floor markings to encourage social distancing, setting up workstations that are a good distance apart and putting screens in place where customer interactions take place. Businesses will also need to put an appropriate cleaning regime in place in order to prevent the spread of COVID-19.

The UK Government has issued a number of guides to help business to return to work safely. These are freely available on www.gov.uk.