Coronavirus update 1 July: MoT extensions ending, furlough scheme changes, buy-to-let opportunities
Good morning. As we reach July, there are two main stories that are likely to be of interest to our clients and readers of this blog. Firstly, the Coronavirus Job Retention Scheme (CJRS) changes today, giving employers more flexibility. Secondly, next month will see MoT extensions ending early. We also take a quick look at some research that suggests many buy-to-let landlords are preparing to expand their portfolios later in the year.
I’ll begin with the MoT story as it’s of direct concern to me at the moment. My car had its MoT extended from June to December. However, in the last week, it has begun to make an increasingly loud rumbling and whirring noise. I’m pretty sure it’s one of the rear wheel bearings, but whether I decide to fix it myself or get a garage to do it, I’m definitely going to put it through its MoT immediately afterwards. Even if your MoT has been extended, you still have to keep your car in a roadworthy condition – and I’m keen to make sure nothing else is wrong with mine.
MoT extensions ending early – what you need to know
At the beginning of lockdown, the government announced that the MoTs of cars that were due to be tested between 30 March 2020 and 29 March 2021 would be extended by six months. Basically, this meant your certificate would become valid for 18 months rather than the usual 12.
That has now changed. If your car is due to be tested on or after 1 August, then you will need to put it through its MoT as normal. The official guidance is available here.
Most garages are now open and you can even get mobile MoT testers to come to you. There is likely to be a much higher than normal demand for MoTs between August and January. So even if your car benefits from an extension, you might want to book in early – better to be safe than sorry!
Furlough scheme changes
It’s also worth noting that the Coronavirus Job Retention Scheme changes today. From now, you can take employees on and off furlough, as long as you have already furloughed them for a minimum of three weeks. Government will still pay 80% of wage costs for the hours worked, although the subsidy begins to drop each month from August. You can read full details of the scheme changes here.
While the furlough scheme changes give employers more flexibility, calculating CJRS claims will now be much more complex. You’ll also have to keep much more detailed records. It’s important to get your claims right, otherwise HMRC will recover any overpayments. If they believe any errors were deliberate, you can be hit with a penalty of 100% of the overpayment.
We would strongly advise asking your accountant at THP to handle your CJRS claims. However, if you do wish to handle the claims yourself, be sure to read our post on How to calculate CJRS claims.
Buy-to-let landlords building ‘war chests’
In a nutshell, research has shown that significant numbers of landlords are remortgaging their properties. They’re doing it to expand both their portfolios and their cash reserves.
Property prices are widely expected to drop before the end of the year, so now is a good time to review your portfolio. If you’d like to talk through your options, please get in touch with your account manager at THP.
About Ben Locker
Ben Locker is a copywriter who specialises in business-to-business marketing, writing about everything from software and accountancy to construction and power tools. He co-founded the Professional Copywriters’ Network, the UK’s association for commercial writers, and is named in Direct Marketing Association research as ‘one of the copywriters who copywriters rate’.