Changes to accounts and audit deadlines for 2020
The Government has published regulations extending accounts and audit deadlines in England for 2020. The Regulations do not apply to Wales although we expect separate regulations.
The period during which public rights of inspection may be exercised is now a period of 30 days commencing no later than Tuesday 1 September 2020. The rule that the period must include the first ten working days in July is disapplied. This in turn means that sections 1 and 2 of the unaudited AGAR must be approved and published on a freely accessible website, along with a notice advertising public rights, no later than Monday 31 August 2020. External auditors will provide templates as they have in previous years. Councils can of course approve and publish, and advertise public rights, at an earlier date.
There is no change to the procedure for approval and signature of sections 1 and 2 of the AGAR, so there must still be a Full Council meeting (which could perhaps be held remotely if the council has procedures in place for this and the regulations permitting this are still in force). There is no change to the rules where ‘under£25,000’ councils in England may declare themselves (again at a Full Council meeting) exempt from external audit.
There has been no change to the publication requirements and deadlines under the Transparency Code for Smaller Authorities (applying to councils in England where neither gross receipts nor gross payments for the year exceed £25,000). Councils should use their best endeavours to comply with the Code, if applicable, but the risk of challenge is low.
Click here to view the advice note on Coronavirus and Local Council Money.
Changes to the Furlough Scheme
The furlough scheme is being used by a small number of local councils where posts are not funded by the precept.
From 1 July, employers can bring back to work employees that have previously been furloughed for any amount of time and any shift pattern, while still being able to claim the Coronavirus Job Retention Scheme grant for their normal hours not worked. When claiming the grant for furloughed hours employers will need to report and claim for a minimum period of a week. Until 1st July a claim must cover a minimum 3 week period and no work can be undertaken.
The scheme will close to new entrants from 30 June. From this point onwards, employers will only be able to furlough employees that they have furloughed for a full 3 week period prior to 30 June.
This means that the final date by which an employer needs to agree with their employee and ensure they place them on furlough is 10 June. Employers will have until 31 July to make any claims in respect of the period to 30 June.
From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back part time. This is a month earlier than previously announced to help support people back to work. Individual employers will decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach for them – and will be responsible for paying their wages while in work.
From August 2020, the level of government grant provided through the job retention scheme will be slowly tapered to reflect that people will be returning to work. That means that for June and July the government will continue to pay 80% of people’s salaries. In the following months, businesses will be asked to contribute, but crucially individuals will continue to receive that 80% of salary covering the time they are unable to work.
The scheme updates mean that the following will apply for the period people are furloughed:
- June and July: The government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
- August: The government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions.
- September: The government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500.
- October: The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.
An employer can still chose to make wages up to 100%.
Claim for wages through the Coronavirus Job Retention Scheme
Claim for some of your employee’s wages if you have put them on furlough or flexible furlough because of coronavirus (COVID-19).
Emergency funding for local councils
On 28 April 2020, MHCLG released the figures relating to emergency funding for local councils. The SLCC is seeking clarification as to whether any of these funds will be cascaded through to town and parish councils and will update members with information as soon as it is available. Click here to access this information.
HMRC guidance on expenses and benefits provided to employees during coronavirus
HMRC have published guidance on the tax treatment of certain expenses and benefits provided to employees (including employees of local councils) during the current emergency. The guidance largely reflects existing law and practice but there are a few concessions. Click here to view the guidance.
There is also guidance on the tax treatment of expenses reimbursed to employees who work from home. This again largely reflects existing law and practice. This guidance can be found here.