Expert guidance from Shipleys without compromising your beliefs

Charities

The governance of a modern day charity is laden with potential minefields for the ill-advised. Shipleys will provide you with expert guidance to ensure all your regulatory and stakeholder needs are met without compromising your beliefs.

Types of social enterprises

A charity is not the only form of social enterprise, and UK law recognises seven different structures, each with its own characteristics, needs and regulations:

  • Unincorporated club or association
  • Trusts (including charitable trusts)
  • Limited Companies
  • Community interest company (CIC)
  • Industrial and providence society (co-operative)
  • Industrial and providence society (community benefit society)
  • Charitable incorporated organisation (CIO)

Our experts will help you choose the structure that’s best for your new enterprise. For an existing one, whatever its constitution, we can help you review and plan for its future with more confidence.

Services

  • Legal structure for new social enterprise
  • Assistance with conversion process, e.g. unincorporated club to CIO
  • Independent Audit or Examination
  • Mergers
  • Process improvements, management controls and risk reviews
  • Gift Aid procedures and regulations
  • Statutory Accounts Preparation and advice on accounting policies
  • Advice on year end accounting and running the year end procedure
  • Advice on trading within a charity structure

Latest news & blogs…

New business support grants and more job scheme money announced

Charities Shipleys Tax Advisors

IN A NEW round of emergency economic support, the government has introduced further grants and lowered the contributions employers must make under the government’s coronavirus Job Support Scheme. At Shipleys Tax we look at the changes announced and how they affect you.

The support aims to help “open but struggling businesses” operating in areas under tier 1 and 2 coronavirus restrictions, with increased support to employers forced to close in tier 3 areas. 

The Jobs Support Scheme, which was initially announced last month, has been extended to include businesses which can open but have seen a fall in demand, by lowering the required hours employees have to work to qualify for the support from 33% of normal hours to 20%. 

In addition, businesses are now expected to cover just 5% cent of employee hours not worked, rather than the 33% as announced in last’s month Winter Economic Plan. 

It is expected the support scheme will apply to eligible businesses in all tier levels. 

The Jobs Support Scheme has been extended to include businesses which can open but have seen a fall in demand, by lowering the required hours employees have to work to qualify for the support from 33% of normal hours to 20%. 

The Chancellor also introduced a new grant scheme for businesses affected by a drop in demand, even if restrictions imposed do not require them to close. Funding would be available to pay every hospitality, leisure and accommodation business in tier 2 areas up to £2,100 for each month the restrictions apply. 

These grants will be paid to local authorities in these areas, which will then be expected to distribute the funds amongst local business. They will be backdated to August for areas under enhanced restrictions since that date.

The Chancellor also introduced a new grant scheme… funding would be available to pay every hospitality, leisure and accommodation business in tier 2 areas up to £2,100 for each month the restrictions apply. 

Changes to Job Support Scheme

The Job Support Scheme (JSS) was designed to replace the Coronavirus Job Retention Scheme (CJRS), which itself was set to end at the end October 2020. 

Initially the JSS was intended to cover funds for employees working part-time (at least 33%) in tier 1 and 2 areas and those businesses forced to close in tier 3 areas. Initially businesses were required to contribute 55% of wages to qualify for the government’s 22% top up. 

In tier 3 areas employers are only required to cover the cost of NICS and pension contributions however, with no obligation to contribute towards wages under the scheme. 

For a full rundown of the grants available and new Job Support Scheme see below.

Job Support Scheme (JSS)

When originally announced, the JSS – which will come into effect on 1 November – saw employers paying a third of their employees’ wages for hours not worked, and required employers to be working 33% of their normal hours.

The new announcement reduces the employer contribution to those unworked hours to just 5%, and reduces the minimum hours requirements to 20%, so those working just one day a week will be eligible. That means that if someone was being paid £587 for their unworked hours, the government would be contributing £543 and their employer only £44.

Employers will continue to receive the £1,000 Job Retention Bonus. The Job Support Scheme Closed for businesses legally required to close remains unchanged.

Self-employed grant

Today’s announcement increases the amount of profits covered by the two forthcoming self-employed grants from 20 per cent to 40 per cent, meaning the maximum grant will increase from £1,875 to £3,750.

This is a potential further £3.1 billion of support to the self-employed through November to January alone, with a further grant to follow covering February to April.

Business Grants for the hospitality sector

The Chancellor has also announced approved additional funding to support cash grants of up to £2,100 per month primarily for businesses in the hospitality, accommodation and leisure sector who may be adversely impacted by the restrictions in high-alert level areas. These grants will be available retrospectively for areas who have already been subject to restrictions, and come on top of higher levels of additional business support for Local Authorities moving into tier 3.

These grants are targeted mainly towards hotels, restaurants, B&Bs and many more who aren’t legally required to close but have been adversely affected by local restrictions nonetheless.

Job Support Scheme

  • The JSS starts to operate from 1 November and covers all Nations of the UK. For every hour not worked, the employee will be paid up to two-thirds of their usual salary.
  • The government will provide up to 61.67% of wages for hours not worked, up to £1541.75 per month (more than doubling the maximum payment of £697.92 under the previous rules). The cap is set above median earnings for employees in August at a reference salary of £3,125 per month.
  • Example: a typical full-time employee in the hospitality industry is paid an average of £1,100 per month. Under the Jobs Support Scheme for open businesses, they will still take home at least £807 a month. All the employer needs to pay is a total of £283 a month or just £70 a week; the government will pay the rest.
  • Employers using the scheme will also be able to claim the Job Retention Bonus (JRB) for each employee that meets the eligibility criteria of the JRB. This is worth £1,000 per employee. Taking JSS-Open and JRB together, an employer could receive over 95% of the total wage costs of their employees if they are retained until February.

Self Employed

  • The government will provide two taxable SEISS grants to support those experiencing reduced demand due to COVID-19 but are continuing to trade, or temporarily cannot trade.
  • It will be available to anyone who was previously eligible for the SEISS grant one and grant two, and meets the eligibility criteria.
  • Grants will be paid in two lump sum instalments each covering 3 months. The first grant will cover a three-month period from the start of November 2020 until the end of January 2021. The government will pay a taxable grant which is calculated based on 40% of three months’ average trading profits, paid out in a single instalment and capped at £3,750.
  • The second grant will cover a three-month period from the start of February until the end of April 2021. The government will review the level of the second grant and set this in due course.

Business Grants

  • The govt is also providing additional funding to allow Local Authorities (LAs) to support businesses in high-alert level areas which are not legally closed, but which are severely impacted by the restrictions on socialising. The funding LAs will receive will be based on the number of hospitality, hotel, B&B, and leisure businesses in their area.
  • LAs will receive a funding amount that will be the equivalent of:
  • For properties with a rateable value of £15,000 or under, grants of £934 per month.
  • For properties with a rateable value of between £15,000-£51,000, grants of £1,400 per month.
  • For properties with a rateable value of £51,000, grants of £2,100 per month.
  • This is equivalent to 70% of the grant amounts given to legally closed businesses (worth up to £3,000/month).
  • Local Authorities will also receive a 5% top up amount to these implied grant amounts to cover other businesses that might be affected by the local restrictions, but which do not neatly fit into these categories.
  • It will be up to Local Authorities to determine which businesses are eligible for grant funding in their local areas, and what precise funding to allocate to each business – the above levels are an approximate guide.
  • Businesses in Very High alert level areas will qualify for greater support whether closed (up to £3,000/month) or open. In the latter case support is being provided through business support packages provided to Local Authorities as they move into the alert level. The government is working with local leaders to ensure the Alert Level very high packages are fair and transparent.

If you are affected by any of the issues above and would like more information, please call 0114 272 4984 or email info@shipleystax.com.

Please note that we do not give free advice by email or telephone.

More than one home – which one qualifies for tax relief on sale?

Charities Shipleys Tax Advisors

IN THE CURRENT climate not many people are fortunate to have more than one property. For the ones that do, there are tax pitfalls to avoid if you are thinking of selling one of those properties.

With the post lockdown mini property boom those thinking of selling the house need to remember the main residence rules when selling. At Shipleys Tax we have our experts who can guide you around the tax traps and we have summarised them below.

Main residence tax relief

The “main residence” tax relief is called Private residence relief. It removes the charge to capital gains tax on the taxpayer’s only or main residence, i.e. there is no tax to pay on sale even if you sell for a large profit.

For the purposes of the relief, a taxpayer can generally only have one residence qualifying for the relief at any one time, subject to the final period exemption for properties which have been the only or main residence at some time, set at nine months from 6 April 2020 (unless the taxpayer goes into care, in which case the final 36 months count).

The “main residence” tax relief… removes the charge to capital gains tax on the taxpayer’s only or main residence, i.e. there is no tax to pay on sale even if you sell for a large profit.

Married couples and civil partners can only have one main residence between them.

More than one residence

Where a taxpayer has more than one residence, they can nominate which of them counts as the main residence for the capital gains tax purposes. However, to be nominated, the property must be lived in as a ‘residence’ – a property which is let out cannot be nominated.

The nomination must be made within two years of the date on which the particular combination of residences changes. If a nomination is not made, which property qualifies as the main residence for capital gains tax purposes will be determined in accordance with the facts.

Where a taxpayer has more than one residence, they can nominate which of them counts as the main residence for the capital gains tax purposes.

Example

Ahmad has lived in a cottage in Shropshire since December 2012. In October 2019 he starts a new job in London, buying a flat in January 2020 to live in during the week. He has until January 2022 to nominate which of his residences is his main residence for capital gains tax purposes.

Getting married

Where a couple marry or enter into a civil partnership and each partner owned a residence which the couple continue to use after the date of their marriage of civil partnership, they must nominate which residence is their joint main residence as married couples and civil partners can only have one main residence between them. The nomination must be made within two years of the date of their marriage or civil partnership.

However, unmarried couples can each have their own main residence.

If you are affected by any of the issues above and would like more information, please call 0114 272 4984 or email info@shipleystax.com.

Please note that we do not give free advice by email or telephone.

£20 million in grants for small businesses – here’s how to apply

Charities Shipleys Tax Advisors

Back in July the government announced a £20 million new funding to help businesses across England get back on track.

Small and medium sized businesses in England can access grants between £1,000 – £5,000 for new equipment and technology and accountancy advice.

But getting to the right location to apply is a bit of a kerfuffle. So here at Shipleys Tax we have done the legwork for you.

The The funding has been allocated to Growth Hubs within each Local Enterprise Partnerships (LEP). You can view it here: Growth Hub funding: allocations for each LEP area.

How to apply

Activities supported through the grant must be to directly respond to the impact of COVID-19 and can include:

  • help businesses access specialist professional advice e.g. human resources, accountants, legal, financial, IT / digital
  • purchase minor equipment to adapt or adopt new technology in order to continue to deliver business activity or diversify

The nature and value of grants awarded will be tailored to local circumstances, and will typically be up to £3,000. Under certain circumstances, and on a case-by-case basis, grants of up to £5,000 may be awarded.

To apply for the grant and find out more, please you can locate and contact your local area Growth Hub here.

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