Practical Guidance Note for the rural and farming community #6
COVID-19: Practical guidance for our rural and farming clients #6
As the COVID-19 virus continues to spread throughout the UK and other countries, we are yet to fully understand what effect the international pandemic will have on British farming and rural businesses. The additional uncertainty surrounding future commodity prices, supply chains and our meat processing capability are just some additional factors to add to the recent upheaval of agricultural lending and adverse weather.
16th April 2020
Andrew Vickery See profile
However, there are opportunities to be found if you have the ability, flexibility and understanding of your business and the market. No matter what we believe the future holds, one thing we can’t argue with is that now is the most critical time to reduce your uncertainty, be proactive and forecast your businesses ability to maintain a viable enterprise. At Old Mill, we’ve made a commitment to give you the advice, tools and resources to get you set-up with best-practice financial management for your farm, rural diversification and family set-up.
We are delighted that our Head of Rural, Andrew Vickery, and expert tax adviser, Catherine Vickery, will be on hand and live to answer your questions on the implications of COVID-19 for the industry and your business.
In this virtual breakfast meeting, we will be discussing topics including grant relief, key financial strategies and the right financial decisions to make.
Join us at 9am on Friday 17 April. To join, click on the link below. Once you open the link, click ‘watch on the web instead’.
If you have any questions that you would like us to discuss, you can send these to us in advance by emailing firstname.lastname@example.org.
The eligibility date individuals had to be employed has been extended from 28 February to 19 March. Find out more on the government website here.
HMRC has also confirmed that an online service to allow businesses to make claims relating to the Coronavirus Job Retention Scheme will be open on Monday 20 April.
However, businesses will be required to set up an online payroll account first and this can take a number of days to process (some reporting 7-10 days). We advise that those looking to furlough their staff set up their account as soon as possible to avoid any delays.
It is expected that phone demand will increase substantially and so the service will be designed to be self-serve but will be accompanied by guidance.
For more information about the update to the Coronavirus Job Retention Scheme, read our up-to-date Insight article here.
A question was raised by a client recently about claiming tax relief on a significant amount of money they lent to a family member for their new business venture, however, the venture now has limited chance of success.
In this instance, they are able to claim a Capital Loss on the amount lost which can be carried forward indefinitely to set against a capital gain, potentially saving up to 28p in the pound if used against a residential property capital gain. However, this must be documented properly at the time. If documentation is not available, it’s often too late when claiming it on a tax return.
If you’re in the same situation, please do not hesitate to get in touch with us to discuss this further.
HMRC has issued new guidance to help the self-employed calculate how much support they will get. In summary, HMRC will assess your eligibility for the grant based on your total income and trading profits. They will use the figures on your tax returns for your total trading income (turnover), then deduct any allowable business expenses and capital expenditure.
If you’re a self-employed farmer claiming farmers’ averaging relief, HMRC will use the amount of profit before the impact of the averaging claims to work out:
- If you can claim the grant
- How much grant you will receive.
Full details and examples can be found here.
The online service to make a claim is not available yet but due to be announced and opened by mid May 2020 and will make payments by early June 2020. Further details can be found here.
For further advice please contact your Old Mill Adviser.
As part of our ongoing commitment, our clients now have free access to Figured until the end of June. Figured is a complete livestock, dairy and crop budgeting, production tracking, and forecasting tool that gives you accurate data in one place, in real time. They’ve taken the unprecedented action to provide our clients with their ‘scenario’ package, in addition to the existing Figured Lite functionality. This will equip you with the tools and resources you need to get yourself set-up with best-practice financial management for your farm.
If you use Xero, you can link your data with Figured software to produce:
- A long-term (5 years) view of where your farm business is currently heading including projected cash-flow, profitability and net worth.
- An adapted long-term view that matches personal and business goals.
- A detailed but adaptable annual plan for 2021 that lays out the financial plan in line with your long-term view.
We will cover the cost of your subscription until Tuesday 30 June and then you can decide whether to cancel or continue.
How do you get started?
If you’d like to familiarise yourself with Figured, have a read of their article on Building your farms plan.
If you would like to register your interest or have any questions, please email email@example.com and we will start the process.