Update – Can I go Limited To Access the 80% Staff Retention Scheme?
Following the Governments announcement that it will assist businesses affected by Covid-19 with 80% of staff wages, we received an interesting question.
Our client as a sole trader has lost all source of income, and as yet the only advice we’re seeing is for sole traders to apply for benefits. The client asked if he could incorporate as a Limited Company and then pay himself a salary which would in theory be covered by the staff retention scheme?
Unfortunately this is not possible, but why?
To be eligible for the staff retention scheme, you would need to have been employed on PAYE since 28th February 2020.
The VAT deferral will apply from 20 March 2020 until 30 June 2020.
VAT refunds and reclaims will be paid by the government as normal.
Companies House Filing
According to the Companies House website, if, immediately before the filing deadline, it becomes apparent that accounts will not be filed on time due to the company being affected by coronavirus, the company may make an application to extend the period allowed for filing.
The law presently gives a three-month extension, but normally it is Companies House policy to not allow extensions unless there are extreme circumstances.
The Financial Reporting Council (FRC) has indicated in its coronavirus updates that that Companies House has changed its policy to automatically allow for a two-month extension and then another month after that if companies can demonstrate extreme circumstances.
The link to our comprehensive guide is below, with information changing all the time, we will keep you as updated as possible.
If you need help understanding what this advice means for you, please pop a question on our social media pages, call Avanti 01473 558866, and follow us for further advice.
*Correct as of 23rd March 2020, subject to change as information is released by the Government.