Since the Government announced that the UK would be placed under lockdown on 23rd March 2020, the financial impact that this would have on thousands of businesses and individuals was, understandably, a cause of concern for everyone up and down the country.
However, since this announcement the Government have pledged to support businesses and have implemented new measures to help them cope and remain operational throughout the Coronavirus outbreak.
Here we provide you with a round-up of the support, which is available to SME’s, self-employed and most recently, start-up businesses:
Employee Costs
Statutory Sick Pay Relief Package
SMEs will be able to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
The eligibility period for the scheme began on 13th March and the refund will cover up to two-weeks’ SSP per eligible employee who are either ill or have been told to self-isolate because of Coronavirus.
Coronavirus Job Retention Scheme
If you are struggling to maintain your current level of workforce due to the negative effect the impact of Coronavirus has had on your business, then you can decide to “furlough” employees and apply for a Government grant which covers 80% of their usual monthly wage costs, up to a total of £2,500 a month.
This scheme was initially hoped to be a temporary measure, but it has since been announced by the Chancellor, Rishi Sunak, that this will be extended until the end of October. From August, employers currently using the scheme will have more flexibility to bring their furloughed employees back part-time.
Follow the link for further details on the scheme: https://www.gov.uk/guidance/cl…
Rates support and grants
Small Support Grant Funds
The Government is providing additional funding for local authorities to support businesses that pay either little or no business rates because of Small Business Rate Relief (SBRR), Rural Rate Relief (RRR) and Tapered Relief.
This will be a one-off grant to eligible businesses to help meet ongoing costs during Coronavirus. No application is necessary, the local authority will contact you if you are eligible.
Under the Small Business Grant Fund (SBGF) all eligible businesses in England in receipt of either Small Business Rates Relief (SBRR) or Rural Rates Relief (RRR) in the business rates system will be eligible for a payment of £10,000.
Under the Retail, Hospitality and Leisure Grant (RHLG) eligible businesses in England in receipt of the Expanded Retail Discount (which covers retail, hospitality and leisure) with a rateable value of less than £51,000 will be eligible for a cash grants of £10,000 or £25,000 per property.
Eligible businesses in these sectors with a property that has a rateable value of up to and including £15,000 will receive a grant of £10,000.
Eligible businesses in these sectors with a property that has a rateable value of over £15,000 and less than £51,000 will receive a grant of £25,000.
Businesses with a rateable value of £51,000 or over are not eligible for this scheme Businesses which are not ratepayers in the business rates system are not included in this scheme
Business Rates relief
Businesses in the retail, hospitality and leisure sectors in England will not have to pay business rates for the 2020 to 2021 tax year.
You are eligible if your property is a:
• shop
• restaurant, café, bar, or pub
• cinema or live music venue
• assembly or leisure property – for example, a sports club, a gym, or a spa
• hospitality property – for example, a hotel, a guest house, or self-catering accommodation
You do not need to take any action. Your local council will apply the discount automatically.
Bank and third-party finance
Small Business Bounce Back Loan
The Bounce Back loan scheme was launched on Monday 4th May and is aimed to help small and medium sized businesses borrow between £2,000 and £50,000.
The Government have announced that they will guarantee 100% of the loan with no fees, interest, or repayments during the first 12 months and is been provided through a network of accredited lenders.
Follow the link below for further details on how you can apply for the loan:
https://www.gov.uk/guidance/ap…
Coronavirus Business Interruption Loan Scheme (CBILS)
A temporary scheme which provides a wide range of business finance products such as term loans, overdrafts, invoice finance and asset finance facilities via the British Business Bank up to a value of £5m.
The Government have announced that they will cover the first 12 months of interest payments so smaller businesses will benefit from no upfront costs and lower initial repayments.
You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly and provide the finance needed in a timely manner.
Coronavirus Future Fund
The Future Fund will provide government loans to UK-based companies ranging from £125,000 to £5 million, subject to at least equal match funding from private investors.
These convertible loans may be a suitable option for businesses that rely on equity investment and are unable to access the Coronavirus Business Interruption Loan Scheme.
The scheme will be delivered in partnership with the British Business Bank.
You are eligible if your business:
• is based in the UK
• can attract the equivalent match funding from third-party private investors and institutions
• has previously raised at least £250,000 in equity investment from third-party investors in the last 5 years
Coronavirus Large Business Interruption Loan Scheme
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) supports large businesses, with an annual turnover of over £45 million.
All viable businesses with turnover of more than £45 million per year can apply for up to £25 million of finance.
The scheme is available through a series of accredited lenders, which are listed on the British Business Bank website. The government provides lenders with an 80% guarantee on individual loans. This gives banks the confidence to lend to many more businesses which are impacted by coronavirus. Facilities backed by a guarantee under CLBILS are offered at commercial rates of interest.
This scheme allows lenders to support businesses that were viable before the coronavirus outbreak but now face significant cash flow difficulties that would otherwise make their business unviable in the short term.
Payment holidays for loans and mortgages
Businesses with existing loans and mortgages should contact their lender(s) to explore the possibility of a payment / mortgage holiday.
Support with your tax liabilities
HMRC: Time to Pay
Any business which may find themselves in financial upset with outstanding tax liabilities may be eligible to arrange a “Time to Pay” agreement with HMRC. This would allow businesses and individuals to pay off their debt in instalments over an agreed period; each decision is made on a case by case basis.
A dedicated helpline has been set up for this on 0800 0159 559.
HMRC: VAT Payments Deferral
The VAT payment deferral scheme has been made available for all businesses regardless of nature or size. The scheme runs from 20th March 2020 to 30th June 2020 and enables the business to defer any VAT liabilities which fall due within this period to be deferred until the end of the 2020/21 tax year.
This is an automatic offer and no application is necessary, however, companies that usually pay their VAT liabilities are been advised to contact their bank to cancel the direct debit if they are unable to pay. This needs to be done in enough time so that HMRC do not attempt to automatically collect payment on receipt of your VAT return.
All VAT returns should be submitted by their due date, as normal protocol.
Support for the Self Employed
Self Employed Income Support Scheme
Like the Job Retention Scheme, self-employed people who are eligible can apply directly to HMRC for a grant worth 80% of their average monthly trading profits over the past three years. The grant is to be capped at £7,500 and is thought to be one of the most generous support schemes announced by the Government in response to Coronavirus.
Individuals are eligible if their business has been adversely affected by coronavirus, they traded in the tax year 2019 to 2020, intend to continue trading, and they:
• earn at least half of their income through self-employment
• have trading profits of no more than £50,000 per year
• traded in the tax year 2018 to 2019 and submitted their self-assessment tax return on or before 23 April 2020 for that year
HMRC calculate the amount to be paid to each eligible claimant based on an average of the tax returns for 2016/17, 2017/18 and 2018/19.
Follow the link below to check if you are eligible for the scheme and complete your application:
https://www.gov.uk/guidance/cl…
Universal Credit
Universal Credit is a monthly payment to help with your living costs. You may be able to get it if you are on a low income, out of work or you cannot work.
HMRC time to pay
If you owe less than £10,000 you might be able to arrange to pay in instalments online.
Because of coronavirus (COVID-19), you can delay making your second payment on account due in July 2020. If you choose to delay, you will have until 31 January 2021 to pay it.
Call the Self-Assessment helpline if you have missed your payment date or you cannot use the online service (0300 200 3835). You do not need to contact HMRC if you have set up a payment plan online.
Staying COVID-19 Secure
Below are links to guidance which you may find useful to ensure that, when the time is right, you can safely reopen your office environment in accordance with Government guidelines and manage the risks of COVID-19.
Working safely during COVID-19 in offices and contact centres:
https://assets.publishing.serv…
Staying COVID-19 secure in 2020: