Keep up to date with the key announcements made this past week.
Summer Economic Statement
In the long awaited summer statement, the Chancellor Rishi Sunak announced a plethora of new measures.
Included in these measures where the ‘Eat Out Help Out’ scheme. Customers with receive 50% off, up to £10 per head, on meals out Monday-Wednesday throughout August.
The VAT rate has been cut from 20% to 5% for the hospitality and tourism industries from July 15th-12st January 2021.
The Nil Rate Band for Stamp duty land tax has been raised from £125k to £500k until 31st March 2021.
Support aimed at getting the younger generation into work was also announced. This includes the Kickstart scheme, along with apprenticeship & trainee support packages for businesses taking on new trainees or apprentices.
A £1000 bonus for each individual a business returns from furlough and continuously employs until post January 2021 was also announced.
For a more in-depth update into the Summer Economic Statement announcements please see our article from earlier this week here
Coronavirus tests exempt as benefits in kind
A loop hole emerged in the guidance produced by HMRC, stating “Coronavirus (Covid-19) testing kits or tests carried out by a third party which have been purchased by you to provide to your employees, are treated as a taxable benefit in kind on the employee.” This would have meant that many front line workers who need to be tested regularly would be suffering a tax consequence of these tests.
Since this was brought to the attention of the Chancellor, Mr Sunak has acted swiftly and confirmed a U-turn. An exemption will be put in place where employers provide test kits for employees for the purposes of Covid-19. This exemption will stay in place for the remained of the 2020/21 tax year.
Personal protective Equipment (PPE) exempt from VAT
It was confirmed this week that the Zero rate of VAT for supplies of PPE will remain in-place until at least 31st October 2020.
Self-Employment Income Support Scheme Extension
An extension to the Self-Employment Income Support Scheme (SEISS), under s71 and s76 of the Coronavirus act 2020, has been announced. The extension will mean the scheme now continues until 19th October 2020.
As a result of the extension a second grant can be claimed from 17th August. This second claim will only be available to those who have been adversely affected by coronavirus on or after 14th July.
The grants will be paid in a single installment covering three months and are capped at a maximum of £6,570. The grants are for up to 70% of average monthly trading profits and are taxable.
Small Business Bounce Back Loans
On the eve of the Chancellor’s summer economic statement it was announced that the numbers of approved bounce bank loans for small firms had surpassed one million.
Small businesses across the country have been able to access loans of up to £50,000 in a bid to help them through the Covid-19 pandemic.
Source – Lexis Nexis via Tolley Guidance