HPC Law: COIVD19 Updates, CJRS & Financial Support
There has been a number of updates and changes to keep track of this month. We have decided that for this addition of HPC Law we would compile our most prevalent #COVID19 content into one digestible article.
Corona Virus Job Retention Scheme HMRC Payment Updates.
This month the HMRC gave further guidance on how and when they would make payments for CJRS. Below we have outlined some of the major updates:
- Confirmation that the CJRS applies to anybody who is furloughed “by reason of circumstances as a result of coronavirus or coronavirus disease”. It is not therefore limited to those who would otherwise need to be laid off or made redundant.
- Anyone employed on 19th March will be eligible for furlough, provided that their employer had submitted RTI payroll data for PAYE purposes by that date.
- To claim furlough, the employer and employee must have agreed in writing that the employee will cease all work. The guidance originally only required employees to be given “notification” of being furloughed.
- Clarification on furloughed directors, which amount to undertaking work to fulfil a duty or other obligation arising from an Act of Parliament relating to the filing of company’s accounts or provision of other information relating to the admin of the director’s company.
- When calculating salary, employers must exclude anything which is not “regular salary or wages”. This means an employer must exclude any performance-related bonus or discretionary payments.
To further this the CJRS qualifying date has been extended from the 28th of February to the 19th of March, therefore supporting a larger amount of staff who had previously fallen out of this scope. This is in addition to how long the furloughing scheme will be active for. It has been extended from the 31Sst of May to the 30th of June. For more information click here: https://www.highperformanceconsultancy.com/2020/04/20/covid-19-extension-of-cjrs-to-end-of-june/
COVID19 & Annual Leave
There have been further updates regarding staff’s annual leave and COVID19. Staff are now able to carry over annual leave into the next two working years. The updated regulations allow staff to carry over 4 weeks of unused leave to be taken in the next two years.
For further guidance please see here: https://www.gov.uk/government/news/rules-on-carrying-over-annual-leave-to-be-relaxed-to-support-key-industries-during-covid-19
For our most recent HR FAQs please see here: https://www.highperformanceconsultancy.com/2020/04/07/covid19-how-to-manage-employee-holidays/
Financial Help During COVID19.
We wanted to share information we have received from a contact of HPC that we thought may be useful. The UK Adviser have several financial products that may be of use to your business if you are struggling to gain support from your bank.
CBILS (Coronavirus Business Interruption Loan Scheme)
- Special lending for viable businesses that CANNOT receive funding under normal lending criteria – not open to all UK businesses
- Only those who meet the underwriting criteria and are in the ‘at risk’ industries who can’t secure finance elsewhere
- First 12 months are interest-free
- Terms up to 6 years
Standard term business loans
- For companies that do not qualify for CBILS
- Secured and unsecured lending available
- Loans can be repaid over 1 – 5 years
- Interest Only periods available
Furlough Finance
- Similar to a bridging loan. Short term finance with the exit being the arrival of the money from HMRC
- Term up to as long as it takes the money from HMRC to arrive.
- The interest is 6%, apply for the full amount and the funds would be drawn down minus 6%.
Asset Finance
- Used for purchasing assets but also a way to release money from a company owned asset
- Flexible alternative to a traditional bank loan, provides significant cash flow and tax benefits for businesses looking to purchase equipment, vehicle or other fixed assets
Cash Flow Finance
- Alternative to a bank overdraft – up to 50k unsecured.
- Helps with cash flow and can be put in place quickly.
- Rates usually between 2.75 – 5% per month.
Invoice Finance
Taken out when having to pay suppliers whilst waiting for your invoice to be paid by your client
Up to 90% of raised invoice value advanced – good for cash flow.
E: contact@highperformanceconsultancy.com
T: 0844 800 5932
Twitter: @HPC_HRservice