Today is another step towards reopening our office in Vermont House. Below are the McGinty Demack Office Details related to this reopening.
Since around the 9th March, some of our staff started to relocate and work from home. This ensured we were ready by the time the Government instituted lockdown measures on 23rd March.

Opening Times

Today, Monday 22nd June we are beginning a gradual return back to the office. This will be phased. So, initially we will open all day on Monday, Wednesday and Friday each week. There will be limited staff on site which will increase the times when books and records can be collected and dropped off. The majority of staff will remain working remotely in line with Governments advice.

Access

McGinty Demack Office Details also include making the office Covid-19 secure following our full risk assessment. To do this we have installed a door entry system to manage access into the building. Inside there is hand sanitising equipment and disinfectant wipes which are available to prevent the virus spread. If our initial steps remain successful and in line with the Government and industry guidance we will extend to include full weekly opening with more staff beginning to return to the office.

Like everyone else, we are all hoping to be able to make changes to relax the controls in place, so that we can return to a normal working environment. As we do, we will continue to update you through website posts and on social media.
As always we will do the upmost to support our clients during this period. So if you need any help with the services we provide please do not hesitate to contact us.

Thank you for your cooperation.

Further to our recent Covid 19 support update we are issuing further Furlough Scheme New Rules information below:

On Friday evening six updated guidance notes were issued. For the new version of the Coronavirus Job Retention Scheme “CJRS” (Furloughed Workers). The Furlough Scheme New Rules are summarised below

Summary

• The first point to note is that any employee not furloughed for three weeks prior to the 1^st July will not be eligible for the new version of CJRS. The qualifying three weeks can be from any time between 1st March to 30th June
• We are used to claims being made up to 14 days in advance of pay day. Under the new CJRS the first claim for July can be made on 1^st July. This means you cannot make an advance claim in June for a July pay period. If you run a weekly or perhaps fortnightly pay period that falls in the first week of July, the business will need to cover the wage liability until the grant is received given the 6 day turnaround for payment.
• Under the Furlough Scheme New Rules, employees not previously furloughed cannot be placed on furlough leave and a claim made under the new CJRS, the cutoff date was 10^th The exception to this rule is employees coming back from parental leave, subject to them being on the company payroll at 19^thMarch 2020
• Claims from July are limited to a maximum number of employees per claim equal to the maximum employees submitted on a previous claim period.

This provision has come out of nowhere and no fuss has been made about it, but, is probably the most important.

• The final day for making a June CJRS claim is 31^st July 2020
• No NIC or pension can be claimed from August.
• The qualifying gross salary amount stays the same as we have previously been calculating, for most employees this will be based on their February 2020 payslip, average of 12 months’ pay or same period in 2019
• Claims from 1^st July will need to be made in the same monthly period. The claims should match with the payroll submission made to HMRC.

You can’t claim from 1^st July to 15^th August say, one claim up to 31^st July will need to be made and then 1^st August to 31^st August.

From the 1^st July the same rules still apply for employees not being able to carry out any work or promotion of the business whilst on furlough leave.

New Calculation – Flexi Furlough Gross Pay

From 1^st July employees can be bought back from furloughed leave for any number of hours. This can be in any working pattern to suit the business under the Furlough Scheme New Rules. For hours not worked, the employee can remain on furlough pay for those hours and the business can still make a CJRS claim.

Calculation of follows:

Gross monthly salary      £4,000, 80% or capped at £2,500

Normal weekly hours     37.5 (calculated on last pay period prior to 19^th March)

Monthly hours                  37.5 / 7 calendar days, multiply by calendar days in the month 31 = 166.07

Rounded up (always) 167 hours

Employee works 50% of normal hours – 83.5 paid at employee’s full pay = £4,000 x 50% = £2,000

Furlough pay = £2,500 x 83.5 then divided by total hours (167) = £1,250

Gross employee pay for the period = £3,250

Claim for CJRS = £1,250

New Calculation under the Furlough Scheme New Rules– Flexi Furlough Employer’s National Insurance

If the employment allowance of £4,000 has not yet been fully utiltised, this will need to be used up first before being able to claim any Employers NIC under the CJRS.

If the allowance has been utiltised, the following calculation applies:

NIC Monthly Threshold  £732

Total monthly hours       167 per gross pay workings

Furloughed hours            83.5 per gross pay workings

CJRS threshold                   £732 x 83.5 hours then divided by total hours (167) = £366

Furlough Gross Pay          £1,250

CJRS claim for NIC            £1,250 – £366 then multiplied by 13.8% = £121.99

New Calculation – Flexi Furlough Employer’s Pension

Under the Furlough Scheme New Rules ,we must use the lower level of qualifying earnings “LLQE” regardless of the pension scheme the business uses for their auto-enrolment scheme.

LLQE threshold                 £520

Total monthly hours       167 per gross pay workings

Furloughed hours            83.5 per gross pay workings

CJRS threshold                   £520 x 83.5 hours then divided by total hours (167) = £260

Furlough Gross Pay          £1,250

CJRS claim for NIC            £1,250 – £260 multiplied by 3% = £29.70

If you are on weekly pay, the above threshold amounts (£732 and £520) will need to divided first, by the calendar days in the month and then multiplied by the 7.

Fortnightly pay, the above threshold amounts (£732 and £520) will need to divided first, by the calendar days in the month and then multiplied by the 14.

Four weekly pay, the above threshold amounts (£732 and £520) will need to divided first, by the calendar days in the month and then multiplied by the 28. 

Phased Employer Contribution

Assuming the hours and amounts remain the same in the worked examples above:

July 2020                              HMRC will reimburse £1,250, £121.99 and £29.70 = £1,401.69

August 2020                        HMRC will reimburse £1,250

September 2020               HMRC will reimburse £1,093.75, employer tops up £156.25 to £1,250

No reimbursement for employer’s NIC or Pension

October 2020                     HMRC will reimburse £937.50, employer tops up £312.50 to £1,250

No reimbursement for employer’s NIC or Pension

If you have any questions about the Furlough Scheme New Rules, please do get in touch with the team. We are all here and happy to help.

The UK government published its plans for a new import tariff regime following the end of the Brexit transition period.

Following its departure from the EU, the UK has the ability to set its own rules and charges.

The scheme includes the abolition of tariffs on imports worth over £30 billion, although economists say the impact on the cost of living will be small.

Some tariffs will be maintained on imported items such as beef and cars to protect British producers. Other items will have tariffs simplified, and expressed in pounds instead of euros.

Josh Hardie, Deputy Director General at the Confederation of British Industry (CBI), said:

‘The new tariff scheme will provide businesses with much-needed clarity on post-Brexit trade.Simplifying the system, scrapping tariffs under 2%, reducing duties on sustainable products are all things firms can work with.

‘Sticking closely to many existing tariff levels will give other countries incentive to agree trade deals with the UK.

‘However, businesses will need time to assess the detail, and ensuring there’s a system in place to address issues as they arise will be critical. Crucially, firms’ number one priority is for the government to strike a deal with the EU and ensuring continuity of existing trade deals.’

Internet link: GOV.UK publications

The Public Accounts Committee (PAC) has opened an inquiry into the UK’s management of £155 billion of tax relief.

The inquiry follows the February publication of a National Audit Office (NAO) report that identified over 300 such tax interventions, totalling £155 billion per year.

The NAO raised concerns about the effectiveness of management of tax expenditures by the Treasury and HMRC.

It found that there is no formal framework governing the administration or oversight of tax expenditures.

The NAO said that although the Treasury and HMRC have begun steps to increase their oversight of tax expenditures and more actively consider their value for money, these will not be enough on their own to address concerns.

Commenting on the inquiry, John Cullinane, Tax Policy Director at the Chartered Institute of Taxation, said:

‘We greatly welcome the PAC taking up this important issue.

‘Governance of tax reliefs in the UK is not systematic or proportionate to their value or the risks they carry. There is a mismatch between the significant effort in government and to an extent Parliament that rightly goes into new tax measures, and the relative lack of attention to how effective those measures prove over time. This is particularly the case with tax expenditures.

‘Unless HMRC and the Treasury actively monitor the use and impact of tax reliefs, and act promptly to analyse increases in their costs, we cannot assume that these reliefs will be value for money.’

Internet link: Parliament website

The government is making changes to insolvency and company law as a result of the COVID-19 pandemic.

The Corporate Insolvency and Governance Bill outlines that struggling companies will be given extra time to consider rescue plans presented to them. As part of the changes, companies will have 20 business days to consider a rescue plan, which can be extended to 40 days at the discretion of creditors or the Court.

The Bill stipulates that a company will remain under the control of directors; however, the insolvency process must be overseen by a licensed insolvency practitioner.

Additionally, restructuring plans have been introduced in the Bill, which will bind creditors and allow the insolvency process to adjust as the COVID-19 pandemic changes.

Colin Haig, President of insolvency trade body R3 said:

‘This Bill represents the biggest change to the UK’s insolvency and restructuring framework for almost 20 years.

‘The measures contained in this Bill will support the profession’s efforts to help businesses navigate the enormous economic damage caused by the pandemic.’

Internet link: Parliament website