Monthly Archives :

July 2020

State Aid & Covid-19 | Accountancy Support for Business in Bristol | What is State Aid | Can State Aid Help Me
State Aid & COVID-19 758 513 Stepping Stones Accountancy

State Aid & COVID-19

With the current COVID-19 crisis many businesses continue to seek government support to help them with the uncertainty of the months ahead. Whilst this aid is undoubtedly a lifeline for many, it could lead to potential problems in the future as businesses that benefit from such schemes can be said to be benefitting from State Aid.

Under EU legislation, a business can be said to be benefitting from State Aid if it receives aid from an EU member state which could distort competition and trade within the EU. This aid can be in the form of grants, tax breaks or loans and if it is deemed to be only available to certain sectors or industries, then it falls within this remit.

However, schemes that are universally available and not restricted to designated sectors or business size, such as the job retention scheme and deferral of VAT and income tax payments, are not classed as State Aid. Further, the business rates relief available for retail, leisure, hospitality and childcare nurseries are also not classed as State Aid, due to the colossal impact that COVID-19 has had on these sectors.

Monies received under the small business grants fund (SBGF) are classed as de minimis State Aid, providing that they fall under the ceiling of €200,000 over a rolling 3-year period, and as a result do not need EU approval. Though all companies benefitting from the SBGF are required to complete a declaration confirming that the aid does not exceed the threshold, including any previous non-COVID-19 related de minimis aid claims.

In order to support businesses in this tumultuous time, the EU have established a temporary framework within which several State Aid measures can be approved rapidly, whilst still being compatible with the EU’s internal market. The UK State Aid that sits under this temporary framework includes:

  • Retail, hospitality and leisure grant fund (RHLGF)
  • COVID-19 business interruption loan scheme (CBILS), interest and other direct payments
  • Bounce back loans
  • Statutory sick pay (SSP) reclaims
  • SBGF claims that exceed the de minimis cap (see below)

All of these measures are subject to a combined overall cap of €800,000 apart from the CBILS and Self-Employed Income Support Scheme.

If you have any questions on state aid feel free to call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk

How do I Register my Accountant as my HMRC Agent? 1024 541 Stepping Stones Accountancy

How do I Register my Accountant as my HMRC Agent?

We regualrly get asked, “how do I regsiter my accountant as my HMRC agent?”. You will find all the answers in our fun animated video.

Adjusting a CJRS claim for Employment Allowance | CJRS Advice Bristol | Covid-19 Business Support Bristol
Adjusting a CJRS Claim for Employment Allowance 758 513 Stepping Stones Accountancy

Adjusting a CJRS Claim for Employment Allowance

The Coronavirus Job Retention Scheme (CJRS) has been set-up by the Government to enable companies to claim up to 80% of an employee’s wages plus any National Insurance or pension contributions during the coronavirus crisis. However, many companies have been left wondering what impact this new scheme might have on their ability to claim Employment Allowance (EA).

In order to provide clarity to the situation, HMRC have recently confirmed that the rules for claiming and applying for EA WILL NOT change as a result of a claim under the new CJRS for Class 1 National Insurance (NI) costs.

Those employers who are eligible can continue to utilise the EA scheme to pay a reduced amount of NIC until their allowance runs out or until the end of the tax year, whichever is soonest. (Currently the employment allowance scheme enables eligible employers to reduce their annual NI liability by up to £4,000). Eligibility applies to a business or charity where their NI liabilities were less than £100,000 in the previous tax year.

In order to calculate how much National Insurance Contributions an employer can claim back through the scheme, they simply need to subtract any EA that is used in a specific pay period. If the employer finds that the amount of EA being claimed will not cover the total employer NIC which is due, then grants are available.

If an employer chooses to delay their EA claim and as such they have employment allowance that is unused at the end of a tax year, then they can use it to reduce other tax costs.

It is important to note that any business needs to make sure they are not receiving relief for the same costs twice, as this can be considered as fraud and may result in claims being investigated. This is where it is best to consult with full qualified accountant who will be able to provide advice, guidance and support for such matters.

If you have any questions or need some assistance then please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk

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