Key changes for Employers for both the new 2020/21 tax year

I thought it would be useful to give a summary of the key changes and updates for Employers for both the new 2020/21 tax year and coronavirus support from HMRC, so have summarised the key points below:

  • From 1st April 2020 the National Minimum Wage will increase to £8.72 for workers aged 25 and over, £8.20 for 21 to 24 year olds, £6.45 for 18 to 20 year olds, £4.55 for under 18s and £4.15 per hour for apprentices.
  • The maximum Employment Allowance available to small business has been increased by £1,000 to £4,000 from April 2020. This means eligible businesses and charities will be able to claim a greater reduction on their Secondary Class 1 (Employer’s) National Insurance Contributions liability.
  • For businesses with fewer than 250 employees, the cost of providing 2 weeks of COVID-19 related statutory sick pay per employee (from day 1) will be refunded by the government in full. HMRC will provide further details in due course on how employers can access the rebate.
    A dedicated helpline has been set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities receive support with their tax affairs. Through this, businesses may be able to agree a bespoke Time to Pay arrangement. If you are concerned about being able to pay your tax, VAT or PAYE due to COVID-19, call HMRC’s dedicated helpline on 0800 0159 559.
  • The grants offered to businesses entitled to small business rates relief or rural rate relief to help pay overheads such as rent have been increased from £3,000 to £10,000. The local authority will contact those businesses who are eligible in early April, you don’t need to apply. I have not seen any detailed guidance yet as to what businesses will be entitled to the grant but am assuming it will only be those who rent business premises.
  • A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.
    There is also a 12-month business rates holiday for all retail, hospitality and leisure businesses in England.
  • Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday will be published by 20th March so I wouldn’t expect them to have the answers before then!
  • A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch next week to support long-term viable businesses to access bank lending and overdrafts. Businesses can access the first 6 months of that finance interest free, as government will cover the first 6 months of interest payments.

Please feel free to contact me if you have any queries on the above, although please bear with me as I may not have all the answers yet and it is very busy here, especially as Sarah has had to start her maternity leave early and I am in the process of setting up a new office!

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