Displaying items by tag: covid19
Accountants exist to ensure the accuracy of financial statements and advise how to save money or boost revenue.
The coronavirus pandemic, then, with its profound and deepening impact on the economy has jolted the profession like all others.
Depending on their role, accountants have been battling to keep on top of the unprecedented flurry of government schemes and announcements, while concerns potentially mount about their own employer’s financial health. Accountants, after all, can be furloughed, too.
With cashflow tight-to-non-existent for many businesses, the temptation to cut back on accounting costs may be too much to resist. But good accountants’ services also have heightened relative value in these tough times.
Retail sales fell by 27% in the first two weeks of the UK's lockdown, resulting in the worst monthly decline on record for the sector overall last month, according to industry figures.
The British Retail Consortium said the coronavirus crisis, which has resulted in deserted high streets throughout the UK, means hundreds of thousands of jobs are at risk.
Its figures showed total sales in March fell by 4.3% compared with the same month last year, the worst performance - when stripping out seasonal distortions - since the survey began in 1995.
Yet that masked the even bigger drop of more than a quarter at the end of the survey period - the two weeks to 4 April - largely covering the time after UK went into lockdown on 23 March.
Coronavirus Job Retention Scheme
Under the new Coronavirus Job Retention scheme, government grants will cover 80% of the salary of PAYE employees who would otherwise have been laid off during this crisis. The scheme, open to any employer in the country, will cover the cost of wages backdated to 1 March 2020 and will be open before the end of April. It will continue for at least three months, and can include workers who were in employment on 28 February.
To claim under the scheme employers will need to:
- designate affected employees as ‘furloughed workers’, and notify employees of this change. Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and
- submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal. HMRC will set out further details on the information required.
- HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.
While HMRC is working urgently to set up a system for reimbursement, we understand existing systems are not set up to facilitate payments to employers. Business that need short-term cash flow support, may benefit from the VAT deferral announced below and may also be eligible to apply for a Coronavirus Business Interruption Loan.
The next quarter of VAT payments will be deferred, meaning businesses will not need to make VAT payments until the end of June 2020. Businesses will then have until the end of the 2020-21 tax year to settle any liabilities that have accumulated during the deferral period.
The deferral applies automatically and businesses do not need to apply for it. VAT refunds and reclaims will be paid by the government as normal.