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Support for businesses through the Coronavirus Job Retention Scheme

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salaries for those employees that would otherwise have been laid off during this crisis.

What it means:

  • HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.
  • HMRC is working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.
  • The scheme, lasting for an initial period of three months, will be extended “if necessary”.
  • The employer can choose whether to top-up the remaining 20% of employees’ pay.
  • The wage subsidy will apply to workers who have already been laid off since 1st March, due to the pandemic, provided the employer brings them back onto the payroll.
  • The scheme is to help employers keep their staff on the books, rather than lay them off. It isn’t targeted at the self-employed.

You will need to:

  1.  Designate affected employees as ‘furloughed workers,’ and notify your employees of this change. To ‘furlough a worker’ means that you have laid them off due to no work, but you have not yet made them redundant. Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.
  1. Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required).

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VAT and Income Tax Payments

VAT

  • Businesses will be supported by deferring VAT payments for 3 months.
  • The deferral will apply from 20 March 2020 until 30 June 2020.
  • All UK businesses are eligible.
  • This is an automatic offer with no applications required.
  • Businesses will not need to make a VAT payment during this period.
  • Taxpayers will be given until the end of the 2020/2021 tax year to pay any liabilities that have accumulated during the period.
  • VAT refunds and reclaims will be paid by the government as normal.

Income Tax

  • If you’re self-employed, Income Tax payments due on 31 July 2020 under the Self-Assessment system will be deferred until 31 January 2021.
  • If you are self-employed you are eligible.
  • This is an automatic offer with no applications required.
  • No penalties or interest for late payment will be charged in the deferral period.

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Business Interruption Loans

Support for businesses through the Coronavirus Business Interruption Loan Scheme (CBILS)

The new Coronavirus Business Interruption Loan Scheme supports SMEs with access to working capital (including loans, overdrafts, invoice finance and asset finance) of up to £5 million in value and for up to 6 years.

The government will pay to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will not face any upfront costs and will benefit from lower initial repayments.

The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs.

This scheme is being delivered through commercial lenders, backed by the British Business Bank.

Eligibility

You are eligible for the scheme if:

  • your business is UK based, with turnover of no more than £45 million per year, and;
  • your business meets the other British Business Bank eligibility criteria.

How to access the scheme

The scheme is now open for applications. To apply, you should talk to your bank or one of the 40 accredited finance providers (not the British Business Bank) as soon as possible, to discuss your business plan. You can find out the latest on the best ways to contact them via their websites.

All major banks are offering this scheme. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

The full rules of the scheme and the list of accredited lenders are available on the British Business Bank website.

The loan scheme provides the bank with a Government-backed guarantee which will enable your business manager to approve it, whereas, without that guarantee, your request for a loan may have been declined.

Please note: It’s important that you are aware that you, the borrower, will always remain 100% liable for the debt. The CIBLS guarantee is to the lender, not you, the SME.

Business photo created by katemangostar – www.freepik.com

Business Interruption Insurance

Does standard business interruption insurance provide cover for businesses who are not able to operate due to the effects of Covid-19?

Business insurance policies are designed to cover standard risks and are therefore unlikely to provide cover for the effects of global pandemics like Covid-19. This includes forced closure by the authorities. Businesses may have chosen to purchase cover that will specifically provide for business interruption arising from notifiable or infectious diseases. For certain notifiable disease extensions, cover may apply if other policy conditions are met. However, this type of extension is not commonly included as standard. Furthermore, the likely costs to businesses of cover that includes more unusual risks – such as those posed by new diseases – would be prohibitive. Businesses who are concerned about the impacts of Covid-19 should check the scope of their cover with the insurance company or broker.

Does a ‘notifiable disease’ extension cover my business for Covid-19?

Most notifiable disease extensions tend to cover specific diseases that will be named in the cover. If Covid-19 is not specified, then cover may not apply. Some notifiable disease extensions are more general and do not specify certain diseases. In these cases, business interruption cover for Covid-19 may apply if it is present in the business. If you are unsure about what your policy covers, check with your broker or the insurer if you purchased it directly.

Are there any other extensions to business interruption that may provide cover?

Some coverage may exist if the business has purchased a ‘non-damage, denial of access’ extension to a business interruption policy. Again, purchase of these extensions tends to be rare and this is not generally covered under standard business interruption policies. Generally, ‘denial of access’ cover applies to cordoned off areas and loss of trade resulting from a denial of access to premises. If a business is forced to close or is told to close by an appropriate authority or is cordoned off, this could trigger a claim under a ‘non-damage, denial of access’ business interruption extension if the infectious disease cover is unspecified or if it includes Covid-19.

Here is some advice from HICS

Most businesses are unlikely to be covered, as standard policies are dependent on damage to property and will generally exclude pandemics. However, we strongly recommend businesses check to see if cover applies for Covid-19 and if so, the specific terms and conditions that apply. Insurance policies can differ significantly, so we’d encourage you to contact your broker or insurer who will be able to help.

If you do have insurance that covers Covid-19, your insurance company is likely to use a Loss Adjuster to represent them. We would strongly advise businesses who have cover in place, to access specialist advice in helping them to prepare, present and negotiate claims. At HICS, we can help with the claims process and can arrange access to a Loss Adjusting service, should you need independent advice regarding  complex, major or difficult claims.

To find out more about this specialist service, contact Scott Robinson our Commercial Director via s.robinson@qasss.co.uk

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An Interview with Mass Foam Systems Limited

Recently we talked to HICS member, Mass Foam Systems Limited, about all things insulation. We found out their biggest achievement to date, what trends they have noticed regarding insulation and their predictions for the year ahead.

Introduce yourself – who is your company and what do you do?

We are Roy Dunn & Brian Massow, Directors of Mass Foam Systems. Mass Foam Systems is one of the UK’s largest installers of Icynene Spray Foam.

You’ve been a HICS member since August 2019, what made you join HICS?

We joined HICS to improve our customers’ confidence when having our market-leading insulation products installed.

So, Icynene spray foam insulation, what got you into it? Why spray foam?

We chose spray foam as we enjoy being able to sell a product that we have faith in that would really benefit UK homeowners by making their homes more energy efficient which in turn helps the environment and global warming.

Tell us an interesting fact why consumers should be considering Icynene spray foam insulation in their homes and/or insulation in general.

Customers can save up to 50% on heating and cooling costs every year. Icynene provides air sealing which prevents heat loss, therefore, saving you money.

What is your greatest company achievement to date?

We have been honoured to be able to assist Chessington Zoo with the insulation of their giraffe enclosure with Icynene Spray Foam. They wanted to insulate to increase warmth and comfort for their giraffes. We used an open-cell foam to insulate as it has no harmful chemicals, so it was safe to apply without harming the animals. We even got to meet the giraffes which was an experience we will never forget!

Have you noticed any trends regarding insulation recently?

UK homeowners are being driven to look at the insulation of their properties and EPC levels with a view to making their homes more energy efficient. Some are wanting an A-rated insulation product which will make their homes’ energy efficient whilst helping the environment and global warming.

What is your 2020 prediction for insulation?

We have seen massive growth in the first quarter of 2020 as open cell spray foam gains more popularity. We are expecting Mass Foam Systems to see one of our busiest years ever with our quality installs and our open-cell breathable products.

And last but not least, if you could invite any 3 people in the world to a dinner party – who would you invite?

  1. Prince Charles of Wales because of his passion for a sustainable future with regards to the environment and our future King of England.
  2. Greta Thunberg as she is our future generation with a passion for the environment and climate change.
  3. Kevin McCloud MBE for his knowledge of quality sustainable property design.

Photo from left to right: Roy Dunn and Brian Massow (Mass Foam).

Coronavirus Contingency Plan

We are sending special thoughts to all our installers and consumers out there that may be experiencing a negative impact due to the coronavirus. This is a difficult time and we’re here to support you where we can.

We are currently operating remotely as normal so that we can all stay safe AND it will be business as usual to continue to support you and your customers.

General Operations

All our people are working remotely from home, including remote access for all emails and website contact emails.

Telephone Lines

Our telephone lines have been diverted so that all calls and enquires whether for our service delivery team, customer service or our ADR and complaints team, can be covered by our people remotely.

Non-Urgent Business

To ensure we continue to deliver our services to installers and customers, non-urgent business will continue to be reviewed, including the suspension of group meetings, business travel and attendance of exhibitions and events.

Inspections and Remedial Works

We have spoken with our inspection providers about their contingency plans and how their inspection and remedial services may be affected. All our suppliers have their own processes in place should the worst happen. All are currently operating as normal until advised otherwise. Should the situation worsen, our suppliers will be providing guidelines and information on their contingency plans which we will then share more widely.

Consumers

Consumers that use our installer network can rest assured our contingency plans mean that it will be business as usual. Our team can fully work remotely from home, meaning that they will have access to all emails and can take all phone calls as usual to deal with any complaints, disputes and/or support as usual.

For now, please keep safe and stay up to date with the advice from the NHS https://www.nhs.uk/conditions/coronavirus-covid-19/

Double Winners at the UK Complaint Handling Awards 2020

QA Scheme Support Services (QASSS) took home two awards at the UK Complaint Handling Awards 2020, including a silver award for Best Complaint Handling and a bronze award for Best Complaint Handling Team of the Year – Initiative.

QASSS operates three consumer protection schemes across home improvement, including HIES, HICS, and DGCOS*. The company entered their Resolution Revolution project into the complaint handling awards, a project led by their dispute resolution team the ‘ADR superheroes’. As finalists for the two awards, QASSS presented their initiatives to an expert panel of independent judges followed by the awards ceremony in London.

The QASSS Resolution Revolution project saw QASSS reach an average dispute resolution time of just 2 days whilst still delivering high satisfaction rates to their customers. All the while the industry average sits at 80 days (CTSI Report, 2018).

Ciarán Harkin, Managing Director of QASSS, commented, “It’s great to be recognised by these prestigious awards in both categories. Our dispute resolution team work extremely hard to resolve customer complaints quickly and fairly. We have had some record-breaking statistics recently, reaching an average resolution time of just 2 days, which is amazing. We’re looking forward to implementing further initiatives as we continually look at ways of improving our services.”

*DGCOS is the Double Glazing & Conservatory Ombudsman Scheme, HIES is the Home Insulation and Energy Systems Scheme and HICS is the Home Improvement Consumer Protection Scheme.

Photo from left to right: Adrian Simpson (QASSS) and Ciarán Harkin (QASSS).

Who is the Office for Product Safety and Standards?

Office for Product Safety and Standards

The Office for Product Safety and Standards (OPSS) was established in January 2018 and forms part of the Department for Business, Energy and Industrial Strategy (BEIS).

What does the Office for Product Safety and Standards do?

OPSS oversees the regulatory system for product safety and standards in the UK. They aim to improve regulatory protections and support compliant businesses by working at the front line with businesses, local and national regulators and consumers.

How do they do this?

For consumers, the Office for Product Safety and Standards provides advice and information which will help them to avoid unsafe products. For businesses, they help them to comply with product safety regulations.

Publicly Available Specification (PAS 7100) “Supporting Better Product Recalls”

The Office for Product Safety and Standards sponsored PAS 7100, a linked code to assist businesses to monitor the safety of products and put a plan in place. PAS 7100 is designed to help businesses plan to deal with any potential product safety issues that might arise with products they have placed on the market or distributed. Recent campaigns from PAS 7100 have been around washing machine recalls and the safety of e-cigarette batteries.

What HICS think

“Consumer safety is incredibly important and it’s encouraging to see that this was recognised by the Government as a priority area for consumers. It’s a large area for businesses to navigate and consumers’ lives and health and safety could be at risk due to unsafe products so to have an agency to support and oversee product safety is very positive” comments Adrian Simpson, Director of Policy and Regulatory Affairs at HICS.

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Giving to Charity and What it Means for Tax

Often, businesses hold workplace activities to raise money for a charity close to their heart. This can be anything from marathons to bake offs to dress down days. But, as a company, do you know what giving to charity means regarding tax?

What is the tax relief?

If you’re a limited company and you give a monetary donation to charity, you will pay less corporation tax by deducting the value of your donations from your business profits. The most you can deduct is the amount that reduces your company’s profits to zero. You will need to keep records of this.

Exemptions

There are some important exemptions where payment won’t qualify if:

  • It’s in the form of a loan that will be repaid by the charity; or
  • The payment is on the condition that the charity buys property from your company or anyone connected to it; or
  • The payment is a distribution of company profits.

Also, if you, your company or anyone connected to your company receive any benefits in return for your donation (for example, tickets to a dinner event) there are limits imposed on the value of such rewards.

Donations by individuals, sole traders or partnerships

Donations can be made by individuals to charity or to community amateur sports clubs (CASCs). The tax goes to you or the charity. How this works depends on whether you donate:

  • through Gift Aid
  • straight from your wages or pension
  • through a Payroll Giving scheme
  • as land, property or shares
  • or in your will

This also applies to sole traders and partnerships.

So, in summary, if you’re a limited UK company and you donate to a registered charity with no direct benefit to the donor, then a corporation tax deduction will usually be permitted. For further reading on this, we recommend the gov.uk website.

Business photo created by snowing – www.freepik.com

Grants Available for Home Improvement Companies

As an established home improvement business, have you ever thought about which grants are available to you? Government grants are great for small businesses, as that extra bit of cash can really help to help to grow your business.

What are business grants?

A business government grant is money that is given to a business that doesn’t need to be repaid, unless in the form of a loan grant.

Types of government grants:

  • Equity finance grants

These grants offer reductions on income tax and investments to start-up and young businesses (less than 2 years old and have fewer than 25 employees).

  • Soft loan grants

These grants are often government-backed and can offer repayment terms and conditions that are softer than those you would receive through banks and building societies. Your business could receive longer repayment terms or lower interest rates.

  • Direct grants

These grants are typically for start-ups as they cover start-up essentials such as equipment and staff training.

Which business grants are available to small businesses?

There are many business grants available to small installation businesses. If you are interested in applying for any of the grants, we advise you to do further research before beginning the application process to be sure that your business is eligible. Here are just 4 examples of grants available and where else you can look for relevant grants.

  • Government grants

As of 12th February 2020, the UK government have 75 grants that are available to small businesses. To view all of these grants, please go over to the Gov.Uk website. These grants range from offering free business development support to equipment to cash.

  • Apprenticeship grants

Apprenticeship grants are designed to support companies employing those aged 16-24 who are on an apprenticeship programme. If you don’t pay the apprenticeship levy, then funding could cover 95% of the cost of training and assessing apprentices.

  • Energy entrepreneurs fund

The energy entrepreneurs fund is a grant funding scheme to support the advancement and development of technologies, products and processes in energy efficiency, power generation and storage. Phase 6 has recently been launched and is over £10,000,000.

  • New Anglia small grants scheme

Applicable to specific parts of Norfolk and Suffolk, this grant is set up and ran by the New Anglia Local Enterprise Partnership in order to support businesses wanting to grow, build services or gain greater efficiencies.

Are small business grants taxable?

In general, yes. Grants are typically taxable income. However, schemes that help with no cash reward aren’t usually liable to tax. We would always advise you to check with your accountant or the grant provider themselves.

Final thoughts – What to keep in mind?

Applying for business grants can be a long, and sometimes stressful, process. Before beginning the process ask yourself:

  • Do I have enough time and resource to dedicate to the application and process of applying for a grant?
  • Is this the right grant for me?
  • Do I meet the eligibility criteria?
  • Do I know what I want this grant for and is it suitable for my business objectives?
  • Can I cover the rest of the financials that the grant won’t cover?

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