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Government salary assist scheme

Can self employed who pay them self and a partner via their limited company also get the 80% help?

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Can self employed who pay them self and a partner via their limited company also get the 80% help?

So clients who have a limited company but pay them self a salary each month and their spouse or mother

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By SXGuy
20th Mar 2020 18:50

Firstly they are not self employed if they have a Ltd company paying a salary.

Secondly, the actual detail hasn't been published yet given that it's only just been announced.

But I would guess that if your directors are on a paye salary being paid by the company then they would be entitled to exactly the same as anyone else on paye.

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Replying to SXGuy:
Psycho
By Wilson Philips
20th Mar 2020 19:26

SXGuy wrote:
Firstly they are not self employed if they have a Ltd company paying a salary.

Tell that to the mortgage lenders!

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Replying to Wilson Philips:
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By SXGuy
20th Mar 2020 22:45

Luckly it isn't them we'll have to deal with on this occasion.

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By mikeyban
20th Mar 2020 18:58

Yes... probably can... what about dividends and the £719 salary company’s???

Will dividends be excluded??

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Replying to mikeyban:
blue sheep
By Nigel Henshaw
20th Mar 2020 19:08

Yes exactly, and is this time to increase the March salary, a raft of questions.

I expect a cold towel around the head in the morning and a long day ahead, but for now a large beverage would be in order (at home of course)

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Psycho
By Wilson Philips
20th Mar 2020 19:12

We need to wait for the details but I would not be surprised if directors were to be excluded. And, as I understand it, the support is intended only to cover the costs of paying workers who are laid up (although if that is the case I’m not sure how that would be policed).

In any event, I would be mightily surprised if dividends were to be taken into account. And quite rightly, too, IMO.

I would also expect measures to prevent salary costs being artificially increased.

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Replying to Wilson Philips:
Slim
By Slim
20th Mar 2020 19:11

I wouldn't be surprised either, otherwise you will have a lot of directors paying themselves £2,500.

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Replying to Slim:
ALISK
By atleastisoundknowledgable...
20th Mar 2020 19:12

Slim wrote:

I wouldn't be surprised either, otherwise you will have a lot of directors paying themselves £2,500.

Not £3,125? (80% being the £2,500)

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Replying to atleastisoundknowledgable...:
Slim
By Slim
20th Mar 2020 19:23

atleastisoundknowledgable... wrote:

Slim wrote:

I wouldn't be surprised either, otherwise you will have a lot of directors paying themselves £2,500.

Not £3,125? (80% being the £2,500)

Ah could be

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Replying to Wilson Philips:
ALISK
By atleastisoundknowledgable...
20th Mar 2020 19:14

Wilson Philips wrote:

We need to wait for the details but I would not be surprised if directors were to be excluded.

I can see a lot of TM01s in the next week. Mrs ALISK included.

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Replying to atleastisoundknowledgable...:
Psycho
By Wilson Philips
20th Mar 2020 19:16

Are you laying her off?

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Replying to Wilson Philips:
ALISK
By atleastisoundknowledgable...
20th Mar 2020 20:44

Wilson Philips wrote:

Are you laying her off?

Yes. She’s the marketing director. I can’t afford to advertise at the moment. (70% of my income is from the F&B and events industries)

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Replying to Wilson Philips:
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By Trevbets
26th Mar 2020 10:46

Wilson Philips wrote:

We need to wait for the details but I would not be surprised if directors were to be excluded. And, as I understand it, the support is intended only to cover the costs of paying workers who are laid up (although if that is the case I’m not sure how that would be policed).

In any event, I would be mightily surprised if dividends were to be taken into account. And quite rightly, too, IMO.

I would also expect measures to prevent salary costs being artificially increased.

I can't agree with your line on dividends because it potentially creates a situation where a secretary would get more than the managing director (assuming he took the £719 per month in PAYE and the rest in dividends. Why should directors be penalised for being tax efficient?

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Replying to Trevbets:
ALISK
By atleastisoundknowledgable...
26th Mar 2020 13:00

Trevbets wrote:

I can't agree with your line on dividends because it potentially creates a situation where a secretary would get more than the managing director (assuming he took the £719 per month in PAYE and the rest in dividends. Why should directors be penalised for being tax efficient?

No, your MD has a salary of £8,632pa end of. Shareholders receiving dividends has nothing to do with this measure.

Believe me, I would love to furlough Mrs ALISK on her full salary & dividend and TBH I will if I'm allowed to, but I don't think I should be allowed to.

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Replying to atleastisoundknowledgable...:
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By Trevbets
26th Mar 2020 16:18

I'm sure in pure tax terms you're correct - but I'm a one-man band...director, owner, chief cook and bottle washer. There are millions of people in the same boat - we pay ourselves £719 per month because we were advised to do that. But obviously most people can't live on that...hence I take monthly dividends. Can't be right that that isn't taken into consideration.

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boxfile
By spilly
20th Mar 2020 19:30

There was mention in a follow up interview that it would be employees that were on the payroll as at 29th Feb.

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Replying to spilly:
ALISK
By atleastisoundknowledgable...
20th Mar 2020 20:45

spilly wrote:

There was mention in a follow up interview that it would be employees that were on the payroll as at 29th Feb.

Daily Mail are saying that it’s only for people that have already been laid off. I don’t believe them - it would be outrageous if that was the case, especially after BoJo told us all not to lay anyone off.

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Replying to atleastisoundknowledgable...:
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By leicsred
20th Mar 2020 20:55

I read that as meaning it would ALSO apply to people already laid off if the companies continued to employ them.

I wonder if the directors will have to sign to say the people have been laid off, at the risk of prosecution if they are investigated and found to have lied,?

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Replying to atleastisoundknowledgable...:
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By gavinbrown1984
20th Mar 2020 21:11

The guidance does refer to ‘furloughed‘ employees so could be some truth in it.

Unfortunately

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Replying to gavinbrown1984:
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By leicsred
20th Mar 2020 21:22

It looks like you have to notify the employee as furloughed (probably via negotiation) and then inform HMRC.

Seems quite sensible?

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Giraffe
By Luke
20th Mar 2020 20:46

I hope so. I have been speaking today to a client who has to shut down the business due to self isolation. He and his wife will genuinely have no income. They currently pay £719pcm each but even 80% of that would make a massive difference to them.

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Replying to Luke:
boxfile
By spilly
20th Mar 2020 21:26

Redundees are supposed to contact their former employer who should then pay over any amounts they receive for them. Ok if they are still on speaking terms I suppose.

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By insolventnl
20th Mar 2020 22:29

I would have thought like most accounting rules directors and their close connections would be excluded from this, purely as these can always be set at not arms length.

You would hardly see Buisness’s which pay above average to external staff or give them benefits which seem obscure.

But it’s amazing the amount of limited company directors asking me this question.

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By SXGuy
20th Mar 2020 22:59

If directors are excluded then other than a grant for those who fall under sbrr I can't see how the government have helped them in any other way apart from claiming universal credit upto the ssp equivalent.

What if a company cannot afford to pay its director a salary as a result of all this but has been doing so up to now? Isn't that the same as any other business laying off its staff?

If wouldn't be hard to pay an average of the last 3 months directors salary to make it fair. After all they'll only get 2.5k max anyway. Granted its abit harder to work out on those who record a one off payment via payroll but it could be prorata'd.

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By gazzo5000
21st Mar 2020 08:11

I've already got clients in particular hairdressers, who want to reduce their employees to probably 2 days a week because of a lack of trade. Are they shooting themselves in the foot by trying to keep them partially in work or will they be able to claim the 80% for the three days they aren't being paid?

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Replying to gazzo5000:
ALISK
By atleastisoundknowledgable...
21st Mar 2020 08:35

gazzo5000 wrote:

I've already got clients in particular hairdressers, who want to reduce their employees to probably 2 days a week because of a lack of trade. Are they shooting themselves in the foot by trying to keep them partially in work or will they be able to claim the 80% for the three days they aren't being paid?

My understanding is that the person needs to be not working, black & white. Your client should put some staff on furlough, retain the others to do all of the shifts.

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Replying to atleastisoundknowledgable...:
the sea otter
By memyself-eye
21st Mar 2020 09:46

So the staff on furlough are paid 100% for staying at home (of which 80% is reimbursed to the employer by HMRC) while the remainder are expected to turn up as usual to work (and get paid as usual).
That's really going to foster good employee relations.
Wed have a large pub client for whom even paying (effectively) 20% of their previous wage bill will be impossible.
Or have I got this wrong?

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Replying to memyself-eye:
ALISK
By atleastisoundknowledgable...
21st Mar 2020 10:59

No, they get paid 80%. The E’er has the option to pay the rest.

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Replying to gazzo5000:
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By JB17
21st Mar 2020 11:04

This is a great question and I’ve asked the same in a different thread.
We are presently opening our retail outlet with all staff working reduced hours as we’ve got less people on the shop floor and reduced opening hours. We are still presently Paying people Full pay even though they are averaging 15 hours per week versus 40 hours per contract. If I’ve read it correctly I believe we need to furlough say 75% of staff and keep 25% working full time to make this work?
I’m also unclear whether we would qualify at all as the shop is still open. This would seem extremely harsh?

Anyone see this from a different angle?
KR
James

gazzo5000 wrote:

I've already got clients in particular hairdressers, who want to reduce their employees to probably 2 days a week because of a lack of trade. Are they shooting themselves in the foot by trying to keep them partially in work or will they be able to claim the 80% for the three days they aren't being paid?

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ALISK
By atleastisoundknowledgable...
21st Mar 2020 09:32

All the talk was of ‘paying staff wages’, HMRC website states it’ll be for ‘wage costs’. Do we know yet if it’s net pay, gross salary or total cost (E’ers NICs & pension)?

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By colinwain
22nd Mar 2020 09:47

What about accountancy firms?

If you run an accountancy practice in London, where people are being encouraged not to travel to, and you have most employees now set up to be working from home. BUT a few employees are now saying that they will run out of work to do soon, and also employees with young children who say that they will have difficulty working from home once the kids are off school.

Is the accountancy practice better off now laying off all the staff for the time being, on the basis that these staff will be unable to work, so that a claim can be made for their salaries?

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Replying to colinwain:
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By gavinbrown1984
22nd Mar 2020 10:05

Does redundancy pay come into effect in these circumstances.

Or the fact they are furloughed (stupid word) , redundancy Pay is not An issue

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Replying to gavinbrown1984:
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By leicsred
22nd Mar 2020 13:45

I think if you furlough redundancy payments aren't in issue as that is the point of the policy, but you will probably have to get their permission (depending on contracts) I don't know what that entails.

To my mind as long as they genuinely aren't working I can't see how it isn't a valid claim.

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