Finance and Accounting Explained BY Alex Chrysostomou

During these difficult times it is important that you are aware what help is available, particularly if you are running a small business. While the help available for individuals and small businesses evolves over time, it is important that you’re aware of the key elements available. Finance and Accounting Explained

SELF-EMPLOYED GRANT - HMRC have now opened the self-employed grant system. All you need to do is log into your government gateway account and you can claim your grant, with the money being paid to you within a week. The grant is calculated as an average of your last 3 years’ profits – they will calculate 80% of 3 months’ worth of profits which will be paid to you in one lump sum. FURLOUGHED STAFF/DIRECTORS If you run a business you can continue paying your staff 80% of their average 2019-20 earnings up to October 2020 (up to £2.5k), which will be covered by HMRC. This will help ensure that your staff continue to get paid. It is important to note however that they can’t perform any work duties if they are to qualify for furloughed pay. You can also claim as a director on your employed income, not your dividends, on the basis that your business is not currently running due to the COID-19 crises (although you are allowed to perform statutory duties like working on your accounts). COMPANY ACCOUNTS - There is a 3 month extension on submitting accounts to Companies House, which will help ease the pressure if your accounts are due soon.

BOUNCE BANK LOAN -This has recently been released, where you can qualify for up to £50k loan, which is 100% government backed. There are no repayments in the first 12 months and once the loan kicks in after a year, the interest rate is 2.5% - this is probably the cheapest form of finance that will ever be made available and I would advise to take advantage of it, even if you keep the money in your savings account for a rainy day (at the moment it’s raining heavily so this loan might be critical to some businesses). VAT/SELF-ASSESSMENT DEFERMENT You don’t have to pay your current VAT liability until 31st March 2021 (this covers any VAT liability up to 30th June 2020). In addition, your selfassessment payment on account, which is due by 31st July 2020 is now not due until 31st January 2021. CIS REFUNDS TO PROCESS - If you operate in the construction industry and may have a tax refund due as a result of CIS deductions made, I would advise to file your tax returns as soon as possible so that HMRC can repay you any tax due.