COVID-19: Update to Government Support

27 Mar, 2020

COVID-19 continues to be a huge concern for businesses as the Government imposes tighter measures in the fight against the virus.  Many businesses have now been forced to either work from home or close completely and more are facing that prospect in the coming weeks, if not days.  We had previously wrote about what the Government was doing to support businesses during these uncertain times but with the situation constantly evolving, this is already outdated.

Here we provide the latest support for set out by the Government and how you can apply for it.  This covers support for all businesses, SMEs, the self-employed, corporate businesses and those within the retail, hospitality and leisure sectors.

The Financial Support Package

After pledging £12bn in the Budget to help the economy through the coronavirus, Chancellor Rishi Sunak has since announced a £350bn financial support package for businesses which includes £330bn in loans, £20bn in other aid, a business rates holiday, VAT deferral and grants for specific sectors.

Full details can be found here.

ALL BUSINESSES

Job Retention Scheme – all UK employers are able to access support to continue paying part of their employees’ salary for those who may have been laid off during the crisis.

You will need to designate affected employees as ‘furloughed workers’ and submit information about them to the HMRC.  They will then reimburse 80% of their wage costs, to a cap of £2,500 per month.

The HMRC are working urgently to get this system set up and expect the first grants to be paid within the next few weeks.  If you need short term cash flow, you may be eligible for the Coronavirus Business Interruption Loan (see below).

Full details can be found here.

VAT Payment Deferral – VAT payments will be deferred for 3 months for all businesses from 20th March until 30th June.

This is automatic with no applications required.  Tax payers will be given until the end of the 2020-2021 tax year to pay any liabilities that have accumulated during the deferral period.

If you pay by direct debit, this should be cancelled with your bank if you’re unable to pay. 

Full details can be found here.

Time to Pay – all businesses and the self-employed in financial distress with outstanding tax liabilities may be eligible to receive support through the HMRC’s Time to Pay service.

If you’re worried about future tax payments or have already missed one, call HMRC’s dedicated helpline on 0800 0159 559.

Businesses Trading Internationally – the Department of International Trade have set up a dedicated team to support UK businesses facing disruption due to COVID-19.  Find out more here.

SMEs

Statutory Sick Pay – if you are a UK SME with fewer than 250 employees as of 28 February 2020, you can reclaim Statutory Sick Pay (SSP) paid for absence due to COVID-19.

A rebate scheme is currently being developed and further details will be provided by the Government once the legislation has passed.

Full details can be found here.

Small Business Rates Relief – if you are based in England and already pay little or no business rates because of Small Business Rates Relief or Rural Rate Relief, the Government will provide a one-off grant of £10,00 to help you meet your ongoing business costs.

You do not need to do anything; your Local Authority will write to you if you are eligible.

Full details can be found here.

Coronavirus Business Interruption Scheme – this is a temporary scheme for SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.

The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and fees so smaller businesses can benefit from no upfront costs and lower initial repayments.

The Government will also provide lenders with a guarantee of 80% of each loan to help build lender confidence in providing finances to SMEs.

To be eligible, you must be based in the UK with a turnover of less than £45 million and meet the British Business Banking eligibility criteria.

This scheme is now open for applications.  To apply, talk to your bank or one of the 40 accredited finance providers as soon as possible.

Small Business Loans – some private lenders, to include Lloyds Banking Group and Natwest are also making additional funds available to businesses.

THE SELF-EMPLOYED

Self-Assessment Income Tax – Tax Assessment payments due on 31st July 2020 will be deferred until 31st January 20201.

This is automatic with no applications required.  No penalties or interest for late payments will be charged in the deferral period.

If you pay by direct debit, this should be cancelled with your bank if you’re unable to pay. 

If you are in temporary financial distress as a result of COVID-19 and have outstanding tax liabilities, take a look at the Time to Pay offer above.

Full details can be found here.

Cash Grant – the self-employed facing financial difficulties will be able to apply for a grant to cover 80% of their wages, up to £2,500 per month.  This will be calculated using average monthly profits over the last three financial years.

This money will be paid in a single lump sum from the start of June at the earliest.

Full details can be found here.

CORPORATE BUSINESSES

COVID-19 Corporate Financing Facility – the Bank of England will buy short-term debt to support you in the short-term.

All non-financial companies that meet the criteria set out on the Bank of England’s website are eligible.

This scheme is now open for applications.  To apply, see the Bank of England’s website.

THE RETAIL, HOSPITALITY AND LEISURE TRADE

If you’re based in England and operate in the retail, hospitality and/or leisure sector, you may be eligible for the following:

Business Rates Holiday – a business rates holiday will be introduced for the 2020 to 2021 tax year.  Those that received the retail discount in 2019-2020 will be rebilled by their local authority as soon as possible.

This will automatically apply on your next council tax bill in April 2020.

Cash Grants – a cash grant of up to £25,000 per property, subject to the Rateable Value of your property.

You do not need to do anything; your Local Authority will write to you if you are eligible.

Full details of both schemes can be found here.

ISO Quality Services Ltd are proud to specialise in the implementation and certification of the Internationally recognised ISO and BS EN Management Standards.

Do you want to get ahead of your competition? Win more tenders or save time and money on reoccurring issues? Contact us today on 0330 058 5551 or email info@isoqsltd.com.

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