We wanted to provide you with a summary of the measures that the Chancellor has announced, to support businesses having difficulties because of COVID-19. Obviously the landscape is changing quickly, and we don’t yet have the details on a number of these measures, but nevertheless the Chancellor has announced:
- The Coronavirus Business Interruption Loan Scheme provides a loan of upto £5m with an interest waiver for the first 12 months. This will start from 23rd March. Businesses with a turnover of under £45million can apply, but your business must meet other British Business Bank eligibility criteria. Further information on the Scheme can be found here. To access the Scheme speak to your bank or finance provider (not the British Business Bank).
- £10,000 one-off grant to businesses that pay little or no business rates due to small business rent relief or rural rate relief. Central Government will provide the money to the local authorities in April. Your local authority will contact you – you don’t need to do anything.
- Statutory Sick Pay relief package for employers with less than 250 employees – this will cover upto two weeks per employee off work due to COVID-19. How the rebate scheme will work is still to be announced. In the meantime keep records of any absences and payments of SSP
- There is support for larger firms through the COVID-19 Corporate Financing Facility. More information is available from the Bank of England.
- All businesses and self-employed people with outstanding HMRC liabilities may be eligible to receive support with their tax affairs through a Time to Pay arrangement. If you have missed a tax payment or you might miss your next payment due to COVID-19, call HMRC’s dedicated helpline: 0800 024 1222 (Monday-Friday 8am-4pm). HMRC has also deferred the next VAT payment, so no VAT will now have to be paid until the end of June 2020, with businesses being given until the end of the financial year to settle all VAT payments. This is an automatic offer, with no applications required. If you have a VAT direct debit, and you want to defer your next VAT payment, we suggest you ask your bank to suspend the payment.
- The next self-assessment payments have now been deferred until January 2021.
- All businesses and organisations are encouraged to retain their employees; and will be able to apply in the next few weeks for Government grants to cover 80% (up to £2,500 per month) of each individual employees’ salaries, who are not working – and have been furloughed, back-dated from 1st March. Find out more about this scheme here.
- Self-employed people with profits up to £50K per annum, who have seen a fall in income due to COVID-19 will receive 80% of their average (over the last three years) monthly profits upto £2,500 per month. The payment will be for three months, but will be given as one payment and as a taxable grant. Find out more about this scheme here.
- Commercial tenants who cannot pay their rent because of COVID-19 will be protected from eviction up until 30 June 2020. This is not a payment holiday though.
In addition for businesses in retail, hospitality and leisure:
- For businesses in retail, hospitality and leisure, rates will be waived for 12 months for 2020/21. You don’t need to do anything to receive this – it will be set out in your next Rates Bill in April 2020.
- Further £25,000 grants for retail, hospitality, and leisure businesses operating from smaller business premises defined as those within a rateable value between £15,000 and £51,000. To access this contact your local authority.
- Pubs and restaurants can provide a takeaway service without a planning application
Furthermore – Nursery businesses in England will also receive a business rates holiday for the 2020/21 tax year. Properties will be eligible that are occupied by providers on Ofsted’s Early Years Register, and wholly or mainly used for the provision of the Early Years Foundation Stage. These businesses do not need to do anything to receive this – it will be set out in your next Rates Bill in April 2020.
This information is correct as of 6pm 26th March 2020.
Please be cautious googling for advice on any of these elements. For example the term “furloughing” is generally used in the USA. Therefore much of the online advice around furloughing, is American!
If you are concerned and unsure what you are eligible for, please contact Jackie or Andrew for guidance and advice.