Randall & Payne - IN FOCUS ISSUE 20 (digital)

BUDGET 2020

Coronavirus Job Retention Scheme Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of the salaries for those employees that would otherwise have been laid off during this crisis. All UK businesses are eligible and it can be backdated to 1 March 2020. Businesses that have already made employees redundant since this date can access the support if they re-hire the affected individuals. In order to access this support, employers will need to: � designate affected employees as ‘furloughed workers’, and notify their 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. � submit information to HMRC about

to £9,500, in a move that will save employees up to £104 per year. The self-employed Class 4 threshold has also increased to the same figure. � The level of income at which pension annual allowance begins to taper away has been increased from £110,000 to £200,000, in a move principally aimed at the medical profession. However for those with income over £300,000, the maximum amount they can contribute has been cut from £10,000 to just £4,000. Further financial measures The weeks since the Budget have seen the announcement of numerous changes aimed at helping individuals and businesses to come through the disruption caused by COVID-19. The threat to jobs and livelihoods was significant and immediate, and the government have moved quickly to try to help businesses avoid making significant redundancies and individuals to remain financially stable. These are the key measures introduced so far. All have a limited time span to begin with (typically around three months) but the government is keeping all these measures under review so it can react to how long the crisis continues, extending the schemes if necessary.

are not set up to facilitate payments to employers. The mechanism is hoped to be in place to make payments by the end of April 2020. Employers can make up some or all of the salary shortfall if they wish, but are not obliged to do so. Throughout a furlough period, it is important that the individual carries out no work for their employer, or eligibility will cease. The furlough period must last at least three weeks and can then be reviewed and extended if required. A company director can be furloughed under the government scheme and the following documentation will need to be in place: 1. The decision to furlough should be formally adopted by the board and therefore minuted accordingly and retained with the company records. 2. There should be a written letter to the Office holder, much as you would for any other employee. It is also important that the director carry out no work of a kind that would generate commercial revenue or provide services to or on behalf of their company. Support for the self-employed Under a similar scheme, those who are self-employed or members of a partnership or LLP are eligible for support of up to £2,500 per month. Key features

the employees that have been furloughed and their earnings through a new online portal.

HMRC will reimburse 80% of furloughed workers’ wage costs, including employer NIC and minimum auto- enrolment pension contributions, up to a maximum gross wages figure of £2,500 per month per employee. HMRC are working urgently to set up a system for reimbursement, as existing systems

randall-payne .co.uk 5

Made with FlippingBook Ebook Creator