Key Contingency Considerations and how we can help Cashflow · this, so perhaps you can help your own customers with an element of their post CV planning. o Considering tax reliefs

Key Contingency Considerations and how we can help

In times of uncertainty not seen for generations, it is vital not to panic, and instead take logical action to give you and your business the best chance of making it through the disruption. We appreciate that is easier said than done when the whole business world has faced such upheaval, so we have created the guide below to point you in the right direction.

The government have made announcements to help businesses and employees over the past few days and we expect more to be made as the situation develops.

We appreciate that each business has its own unique circumstances so once you have read through this, feel free to contact one of our highly skilled business advisors for further guidance on the next steps for you and your business:

Cashflow Cash is king, more than ever in the current climate, key things to consider helping preserve cash include:

o To start with, every business should be working towards a weekly cashflow forecast at this point, itsyour go to tool to understand where you are and where you are heading - We can help assist you in building a bespoke cashflow forecast for your business or critiquing your own cash flow forecast thatyou are able to build using the templates included in our pack.

o One of the next important things to consider is getting your books and records up to date – In light ofthe need for funding and to have better control of your business this is more essential than ever

o Looking at ways your business can pivot in the short term – Thinking about whether there is any wayyou can offer your services remotely, either packaging them up online/virtually or looking at a way touse your expertise to provide offsite consultancy. One thing is for sure, people will be raring to go afterthis, so perhaps you can help your own customers with an element of their post CV planning.

o Considering tax reliefs such as research and development, one of the most misunderstood and underutilised tax reliefs, which actually has a potential cash repayment possible – we can send details of qualifying criteria

o Speaking to your customers - chasing for payment and having a clear credit control process is more important than ever and you need to understand whether you are likely to experience significantdelays to projects and your receivables so you can forecast as accurately as possible

o Speaking to selected suppliers to reduce rates or agree a payment holiday – Being open and honest, alot of them will be going through the same thing, and therefore will understand where you are coming from when asking for payment holidays and reductions in rates

o Speaking to your landlord to agree a payment holiday

o Loans and other lending facilities - Explore options around payment holidays around your currentbusiness and personal loans and mortgages, below is a table illustrating what current lenders are doingin light of the virus.

o Hedging your foreign exchange exposure given high fluctuation

o Insurance – Although most businesses are unlikely to be covered, as standard business interruptioninsurance policies are dependent on damage to property and will exclude pandemics. Insurance policies differ significantly, so we encourage you to check the terms and conditions of your specificpolicy and contact their providers. Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim.

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o Working from home – Ensuring you and your team are set up and able to work from home whereverpossible. Make the most of apps and software such as zoom which offer free use for a limited timeperiod

o And finally planning aheadWe will come out of this, and given most businesses have experienced a drop in output and willcontinue to do so, this gives you the time you have probably been desperate for, to work on yourbusiness to ensure you are well placed and fighting fit to be ready to spring out the other side

Our strategic team are perfectly placed to have these post CV exit conversations with you, on topicsuch as:

Critically Evaluating your business model and related product and service offerings

Assessing your cost base going forward – What this has done is given businesses the push tostringently assess every cost in their business which will gear them to come out of this leanerand will lead to more profit

Creating your post CV marketing drive, who, what, where why and how are you targeting, italso allows you the time to review and analyse any data you have been collecting and haven’thad time to do anything with

Looking at your personal goals – This is a time where everyone has probably appreciated that health and family come before everything else, so this time will enable everyone toproperly look at why they are in business and what they want to achieve both in the mediumand longer term, which will act as the target point for future planning

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Cashflow – Support from the Government

o Utilising HMRC’s time to pay initiative – HMRC have made it clear that they are willing to work with and supportbusinesses in this time, so we can assist with payment arrangements based on your unique circumstances.

HMRC have also deferred VAT liabilities for the period 20 March 2020-30 June 2020 until March 2021

Self Assessment payments on account for self-employed people until January 2021, to enable businesses to keep more cash in their accounts in the short term.

o Government grants on business ratesThe government will be issuing grants of £10,000 to businesses who are eligible and registered for either smallbusiness rate relief (SBBR) or rural rate relief.

The government have been liaising with local authorities, with the first grants expected to be distribute in earlyApril.

There is also further support for businesses in the retail, hospitality and leisure sector:

o A £25,000 grant for those businesses in the above sector with a rateable value between £15,001 and £51,000

o Business rates holiday for the 2020 and 2021 tax years

Nursery businesses paying business rates are also eligible for the business rates holiday.

For all the grants, local authorities will contact you directly, rather than you having to apply yourself, however we are recommending to proactively contact local councils to gauge a timeframe from the council specific to you.

If you are unsure which council your business is classified under, use, https://www.gov.uk/find-local-council

o Coronavirus Job Retention Scheme

The government have pledged to cover 80% of wages for those workers who were to be laid off due to thecoronavirus crisis. This is backdated to 1st March 2020 so any employees who have already been laid off from thisdate can be re-instated.

You need to designate such employees as ‘furloughed employees’ and notify your employees of this change. Yourpayroll company will then submit information about the furloughed employees and their earnings direct toHMRC through a new online portal.

The government are quickly working on setting up the new portal so re-imbursements can flow through back tothe employers, with further details expected imminently.

For the immediate term, if you use or would like to use Nordens for your payroll needs, please provide us details of those employees you have chosen to ‘furlough’ so we have the details on file and can submit the information as soon as the portal is up and running.

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o Business interruption loan schemeThe government have introduced a scheme to support primarily small and medium-sized businesses toaccess bank lending and overdrafts.

The scheme is not a loan itself but is a loan guarantee whereby if a certain criteria is met, thegovernment may help secure up to 80% of the loan, in an effort to give lenders further confidence in providing finance to SME’s. What this means in simple terms is:

You would apply for a debt facility as normal and the lenders would assess the affordability ofthe application

If this does not work out to be an affordable/commercially viable application, then the debtfinance would most likely be rejected.

If this does work out to be an affordable/commercially viable application, then the lenderswould look to provide finance but would also look for a form of security to protectthemselves.

If you are able to provide sufficient security, then the application and debt facility will mostlikely be successful and processed.

If you are unable to provide sufficient security, then, if you meet certain eligibility criteria, thelenders will now look to the government to provide up to 80% of this security.

It is still not a guarantee that the government would provide this security, but if they do, then the debt facility will be under the business interruption loan scheme and will have a lot more favourable terms i.e. interest rates and even a 6 month interest free period.

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o Self employed workers

Self-employed people will be able to apply for a grant worth 80% of their average monthly profits overthe last three years, up to £2,500 a month.

At least half their income needs to have come from self-employment as registered on the 2018-19 taxreturn filed in January - anyone who missed the filing deadline has four weeks from now to get it doneand still qualify.

The scheme is open to those who earn under £50,000 a year - up to 3.8 million of the 5 million people registered as self-employed.

Unlike the employee scheme, the self-employed can continue to work as they receive support.

The money, backdated to March, will arrive directly into people's banks accounts from HMRC, but notuntil June.

The grants will be taxable, and will need to be declared on tax returns by January 2022.

Company owners who pay themselves a dividend are not covered.

Use nordens grant calculator to check your eligibility

In the meantime self employed people are urged to

o Explore opportunities around the coronavirus business interruption loan schemeo Explore the options with your local authority to receive a payment holiday for your

council tax billo Explore your eligibility for universal credit, advanced claims upon applications can

be given within a matter of days – see below for details

Apply via - https://www.gov.uk/apply-universal-credit

Self-assessment and VAT deferral as mentioned above will apply to self employed people

UNIVERSAL CREDIT STANDARD ALLOWANCE

Your circumstances Monthly standard allowance

Single and under 25 £342.72

Single and 25 or over £409.89

In a couple and you’re both under 25 £488.59

In a couple and either of you are 25 or over

£594.04

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o Property and Landlords

Emergency legislation to suspend new evictions from social or private rented accommodation whilethis national emergency is taking place

No new possession proceedings through applications to the court to start during the crisis

Landlords will also be protected as 3 month mortgage payment holiday is extended to Buy to Letmortgages

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Team management

It is vital you are communicating effectively with your team. Honesty is the best policy. As per the most recent guidance, wages still need to be paid, and the impact is likely to result in significant job cuts, however there are options for your business:

• Step 1 - Working contingencies - Does your team have the scope and ability to work from home, while this willnot be possible for all businesses/industries, for those where it is and you need support getting this set up, speakto us.

• Step 2 - Get together with all employees to explain what is happening and ask for ideas as to how the business can deal with the current situation. This could be reducing to a 4 day week with the possibility of reducingfurther if needed. Most people would rather reduce their hours and pay than face the possibility of redundancyin the current market. By having open discussions and explaining what the business is doing to reduce overheads, employees should feel that everyone is working together to get through this.

• Step 3 - Assess those employees with less than 2 years’ service and if appropriate explain the situation to themand dismiss them. For these employees, they don’t have statutory protection against unfair dismissal, as thisoccurs after 2 years of continuous employment service and there won’t be a redundancy package.

• Step 4 - As a response to a lack of work and as an alternative to making redundancies, an employer can lay off an employee for at least one working day. There is a statutory scheme for lay-off, but the appropriate clause needsto be in the employment contract in order to implement this. If this were implemented, then an employee can be laid off for up to five workless days in any three month period and would be paid £29 per day, so would lose five days salary and receive £145 instead. If you can provide us with a copy of your Terms of Employment, ourHR team would be able to clarify whether a lay off is a viable option.

• Step 5 - Depending on the outcomes of the meetings outlined in step 2, you may need further guidance on the ways to terminate employee’s employments.

Our HR team can review your contracts and consult with you on the best way forward for your business

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List of lenders helping their mortgage and loan customers

Lender Offering deferred payments Offering reduced payments Waiving fees for missed payments

Bank of Scotland Yes - Yes

Santander Yes Yes No

Halifax Yes - Yes

HSBC Yes Yes No

First Direct Yes for loans only No No

Lloyds Yes - Yes

Nationwide Only for mortgages - -

NatWest Yes, for up to 3mths No No

RBS Yes, for up to 3mths No No

List of lenders helping credit card customers

Lender Offering payment holidays Offering credit limit increases Waiving fees for missed payments

HSBC Yes Yes Yes

Bank of Scotland Yes No Yes

First DirectYes – tailored to individual

needYes No

Halifax Yes No Yes

Lloyds Yes No Yes

Nationwide No Yes only for those in Financial difficulty

NatWest No Yes No

RBS No Yes (temporarily) Yes

Barclays No Yes No

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VAT – FAQ’s This is the latest update as at the morning of 23rd March 2020, if there are any additions or changes will update you as we go along.

Who is eligible to defer their VAT payment? All businesses, there is no certain criteria

Do you still need to submit the VAT return(s) to HMRC? Yes, this is mandatory

When does the return(s) need to be paid by? By 31 March 2021 it must be paid in full. Smaller voluntary payments can be made leading up to March 2021 to make this easier for cash flow.

Does this cover old VAT debts? No, it will cover the payments that are due to HMRC by the 7th of April until 7th of July which means the VAT returns that are covering the VAT quarters ending February, March, April & May.

What will happen with old debts? HMRC have announced a helpline that is dedicated for businesses and self-employed individuals who have difficulty with paying their tax due to COVID-19.

The number is 0800 0159 559.

The helpline can assist with: -Setting up a time to pay arrangement-Suspending debt collection proceedings, and-Cancelling late payment penalties and (unusually) interest

Will HMRC publish or send out any further formal announcements? Currently nothing has been confirmed

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Payroll and PAYE FAQ’s

Who will pay my wages? If you are still employed but do not currently have work, the plan is that you will still get your wages.

Your employer will be able to access grants, by the end of April, from the UK's tax authority to allow them to keep paying you.

The typical worker is paid £585 a week, on a median average (which is the middle point of all workers), according to the Office for National Statistics (ONS). That is about £2,340 a month.

The government says 80% of gross wages in the private sector, up to £2,500 a month, for those not working and who would otherwise have been laid off will be covered by these grants from HM Revenue and Customs (HMRC).

These will be backdated to March and the scheme will last three months at least. The idea is to prevent mass unemployment.

What if I'm working from home? Everyone who can work from home should do so. Working hours can still be clearly defined, and staff should receive their normal pay.

However, this puts various new responsibilities on an employer - for example, they are responsible for equipment they supply, and must say what it should be used for.

The question of who covers the running costs should ideally be outlined as soon as possible, as should how any extra expenses should be covered.

An employer has a duty of care for staff, even if they are working at home.

The requirements of the health and safety legislation apply to homeworkers too, according to the employment conciliation service Acas, which has set out guidance for employers and employees.

Will I get paid if I need to look after my children? When your children's school is closed, or if you have a relative who is ill, your employer must give you time off to look after them.

But your employer is not forced to pay you unless your contract requires it.

However, many employers are allowing parents to work flexibly, to try to manage both work and childcare.

Key workers, who have been defined by the government, can still send children to school or nursery.

Will I get paid if I have to self-isolate? You may do through sick pay which varies from company to company.

Many employees will have contracts that allow them their normal pay while they are unable to work because they are sick.

Even where people do not get their fully paid sick leave, or if they work in jobs where they do not have contractual sick leave, there may be minimum payments they can rely on, known as statutory sick pay.

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What is statutory sick pay? Statutory sick pay (SSP) is money paid by employers, so self-employed workers are not eligible, but casual or agency workers are.

Chancellor Rishi Sunak said that SSP would be paid to people who need to be off as they or their family have symptoms. People should be able to obtain a sick note from the NHS 111 service rather than getting one from a GP.

The rules were also changed so that those people would be eligible for SSP on their first day away from work, instead of having to wait until the fourth day as used to be the case.

He also announced that businesses with fewer than 250 employees would be able to claim back from the government two weeks of SSP paid to staff affected by coronavirus.

How much is statutory sick pay? It is set at £94.25 a week, although of course employers could pay more if they want to.

To get SSP people need to be earning at least £118 a week. Many people such as those on zero-hours contracts - who work variable hours every week - may earn less than this. The Trades Union Congress (TUC) has calculated that there are two million workers who are not eligible for SSP.

We asked the Office for National Statistics to check this figure and they estimated that there were 1,766,000 jobs done by adults in the UK that paid less than £118 a week.

The number of people involved is likely to be somewhat lower than this because one person could have more than one of these jobs. And indeed, if somebody has more than one of these jobs it could take them above the £118 a week needed to qualify.

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