If you are a director of a company where you are the sole employee, navigating the support available to help you throughout the Coronavirus outbreak could look like a daunting prospect.
To help you make the most of the support available, we have compiled the following top tips:
- You can furlough yourself, receive up to 80 per cent of your usual wages and work for a new employer – The Government’s Coronavirus Job Retention Scheme enables employers to furlough workers and receive a grant for 80 per cent of their usual wages, capped at £2,500 per month, and the associated employer National Insurance Contributions and automatic enrolment pension contributions.
Furloughed workers remain on the payroll but may not carry out any work for the employer during the period of furlough.
The good news if you are a director of a small company is that you can furlough yourself. However, the rules appear to be extremely restrictive and limit you to fulfilling only your filing duties under the Companies Act.
While you are furloughed, you can work elsewhere as long as it is not for a linked or associated organisation, but continue to receive your furlough payment.
- You can defer your July Income Tax payment – All taxpayers who are due to pay their second Self-Assessment payment on account on 31 July 2020 can defer their payment until 31 January 2021. This is an automatic offer with no application required.
- You can ask to defer your business taxes – HM Revenue & Customs has launched a dedicated Time to Pay helpline to arrange tax payments in instalments. The number is 0800 024 1222.
Time to Pay is only available where all other avenues of financing have been exhausted.
- You can apply for a Coronavirus Business Interruption Loan (CBILS) – These loan facilities are provided by more than 40 lenders accredited with the British Business Bank and are for sums of between £1,000 and £5 million. The facilities are interest-free for 12 months and are backed by an 80 per cent Government guarantee.
- You can apply for a three-month mortgage holiday – These are available to all homeowners who are up to date on their mortgage repayments. However, you will continue to accrue interest and so will likely have to pay more when payments resume.
You may be able to claim Child Benefit – if you have children and were previously earning more than £50,000, and opted out of Child Benefit in order not to pay the High Income Child Benefit Charge, you may wish to apply again for Child Benefit.
If you have been paying the High-Income Child Benefit Charge, while still receiving Child Benefit, the situation is more complicated. In these circumstances, your income must fall below £50,000 for a whole tax year before you can stop paying the charge.
For detailed advice, please contact us today.