COVID-19 NEWS BULLETIN 26th MARCH 2020

Chancellor of the Exchequer 17.10pm 26.03.2020 – for SELF EMPLOYED.

 

A taxable grant shall be offered to those who are self-employed and meet eligibility.


Based on 80% of annual trading profits, averaged over 3 years. To a maximum of £2,500 each month.

 

Eligibility for this taxable grant has been stated as;

  • Your trading profits must be below £50,000.

  • The majority of your income must come from self-employment.

  • You must already be within the self-assessment regime, i.e. already known to be self-employed.

     

If you missed the January deadline for self-assessment you will have 4 weeks from today to submit your return for the tax year 2018/19. The plan currently is for this scheme to run for 3 months. And HMRC will contact you if you meet the eligibility criteria.

 

At the time of this bulletin, we are awaiting further clarity on the above information as the information has just been released. We will update you via these bulletins as more information becomes available.

 

 

 

Europe awaits unemployment figures

 

EU struggles to find agreement on common debt instrument to battle coronavirus


EU countries are divided over "corona bonds," a controversial debt instrument aimed at tackling the economic impact of the coronavirus outbreak. CNBC's Silvia Amaro reports.

 

Source:BBC

 

UK AWAITS HELP FOR SELF -EMPLOYED

 

 

   

IR35 tax reforms have been delayed a year

 

Controversial reforms which will lead to tax bills going up for many self-employed people have been delayed a year as a result of coronavirus. Changes to IR35 'off payroll working' rules – anti-tax avoidance rules – will now come in in April 2021 instead.

 

The changes will mean every medium and large private sector business in the UK will become responsible

for setting the tax status of any contract worker. Currently the rules only apply to the public sector.


In simple terms this means self-employed people working for a company will pay more tax. And the fear

is that businesses will find the changes too complicated and use fewer self-employed people as a result.

 

However, while the delay comes as a respite for some, it's been made clear they will still definitely go ahead in April 2021.

 

Life insurance and income protection insurance should cover coronavirus – critical illness policies won't

 

Whether or not you're protected for claims relating to coronavirus depends on what kind of insurance you have:

  • Life insurance and income protection insurance SHOULD cover coronavirus. If you have a life insurance or income protection policy in place you should be covered for any claims related to coronavirus. This is because these policies are usually based on declaring any existing conditions – but if you have an existing policy, you couldn't have declared coronavirus as a condition before now so that won't be an issue.

It is still possible to take out a new policy to protect yourself. If you are looking at taking out a new policy – either life insurance or income protection – it is likely you'll be asked additional questions, such as whether you've already tested positive for Covid-19, have had symptoms or have been told to self- isolate. If you have, an exclusion may be applied.

  • Critical illness cover WON'T apply to coronavirus. If you have critical illness cover, you will not be covered for Covid-19 claims, as it isn't considered a critical illness. If, however you developed a seriousillness/condition as a result of coronavirus, that could be considered as a possible claim.

• Getting accident, sickness and unemployment cover is now tricky. For those seeking accident and sickness cover, it is still possible to get it but many insurers are no longer offering unemployment cover as an option, or no longer accepting new applications, or imposing additional exclusions (ie, claims may not be made unless you have been unemployed for at least a couple of months from the start date of your policy). Source: MSE

 

NHS and social care staff will get free car parking when working at hospitals for the duration of the coronavirus outbreak, Health Secretary Matt Hancock has announced.

  • NHS trusts are responsible for setting car parking charges but the Government says it's committed to providing the financial backing so they can abolish parking charges for NHS and social care staff.

  • The Government also says that some hospitals may require additional car parking capacity and that under new measures, critical key workers will be able to use council parking bays without time restriction or charge.

  • The changes will apply to all on-street parking and open, council-run car parks including pay and display, and will see charges suspended for health workers, social care workers and NHS volunteers. The way that people provide evidence for their jobs will be decided by individual councils.

  • The National Car Parks group also confirmed yesterday that it will provide free parking for NHS staff at all 150 of its car parks in England.

 

Barclays and Halifax Intermediaries cap mortgage lending amid coronavirus lockdown

 

 

 

Barclays and Halifax Intermediaries are among the first major lenders to restrict the size of new mortgage loans, as the impact of the coronavirus starts to spread to the housing market. 

 

Halifax Intermediaries, Scottish Widows Bank and BM Solutions – which are all part of Lloyds Banking Group – have taken the biggest step and temporarily pulled most deals above 60% loan-to-value (LTV) for both buyers and people remortgaging.

 

Meanwhile, Barclays has withdrawn the majority of its mortgage deals above 60% LTV for purchases for new buyers.

 

This means you'll need at least 40% equity in your home or a 40% deposit to get a remortgage or mortgage deal through Lloyds's intermediary brands. This won't apply though if you're going direct (ie, not through a broker) to Lloyds or Halifax for a mortgage or remortgage.

 

With Barclays, you'll now need a minimum deposit of 40% to get a mortgage through them if you're buying a home.

 

It comes as a number of smaller building societies have also capped their LTVs in the past few days at levels lower than they were pre-coronavirus.

 

What exactly are the new mortgage measures?

 

The main new measures Lloyds's intermediary brands and Barclays have introduced restrict new lending for purchases beyond 60% LTV, meaning you'll need at least a 40% deposit to get a mortgage.

 

But Lloyds's intermediary brands have gone even further, removing all of their remortgage products above 60% LTV.

 

The remortgaging restriction doesn't apply to Barclays though, with the bank still offering remortgage products up to 90% LTV.

Additionally, Lloyds Banking Group have said that product transfers remain unchanged.

 

Lending above 60% LTV threshold "tends to require a physical valuation of the property and, while the UK is in a state of lockdown, valuers are not being sent to carry these out".

 

A Barclays spokesperson said: "This action has been taken to support our colleagues in managing the flow of applications into our UK underwriting teams following the closure of our key offshore sites due to restrictions put in place by local government related to coronavirus.

 

"At the same time, it enables our colleagues to provide greater help to those customers requesting mortgage payment holiday arrangements for financial support."

 

What measures are other mortgage lenders taking?

 

A number of other smaller, more specialist lenders have also taken similar steps to reduce their level of LTV lending, while some lenders – including Vida and Pepper – have gone even further and stopped accepting new residential mortgage applications entirely.

 

In addition, some mortgage applications that have already been submitted are now being put on hold by lenders – including NatWest and Halifax – if they require a physical valuation which has not yet been carried out, according to Hollingworth.

 

We understand that part of the reason behind the scaling back among smaller lenders is reduced levels of staff, and lenders prioritising existing customers.

 

How can I find the best mortgage deal for me?

 

Before the coronavirus outbreak, many lenders allowed you to borrow up to 95% LTV, meaning many first-time buyers with a small 5% deposit could get onto the housing ladder (though the higher the LTV, the more expensive your mortgage rate).

 

Though this largely remains the same (for now at least), nobody can predict the future with a lot of uncertainty around. Source: MSE

 

The COVID-19 situation is fast moving and although we endeavour to bring you the latest information, the details enclosed are correct as far as we are aware, at the time of issue.

 

Should you have any concerns or questions, we are here for our clients and will happily arrange a telephone or video call appointment to provide guidance.

 

A good number of clients have taken the opportunity to use this downtime to review their financial planning, specifically analysing their current income and expenditure along with what income is expected to be in 6-12 weeks. This planning has been greatly received as it enables clients to prepare for what could be uncertainty for a prolonged period.

 

If you would like to take advantage of this review, please either call our practice mobile 07543 368 478 or email enquiries@money4dentists.com

 

We are here to help you through these challenging times, so please don’t be afraid to get in touch.

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