Support for businesses
We have created this web page to act as an information point for all our clients – as measures are being regularly announced and details slowly start to become available, we hope this will help you to more easily keep up with developments and make sure you can access the support you need.
Job Support Scheme
This scheme has now been replaced by extension to the furlough scheme.
Coronavirus Job Retention Scheme
*Latest Update*: This scheme has now been extended to 31 March 2021. During this extension employers will be able to claim the full 80% paid to their furloughed workers (but will not be able to claim National Insurance or pension contributions) although this will be reviewed in January. Employees will be eligible if they were on the payroll and included in an RTI submission by 30 October 2020. Flexible furlough will continue to apply for the extension.
Read our factsheet on the extension.
If you have any queries on the furlough scheme, please contact us.
Job Retention Bonus
The bonus scheme has now been withdrawn due to the extension of the furlough scheme. A new incentive scheme will be announced in future.
Coronavirus Business Interruption Loan Scheme (CBILS)
*Latest update*: the Government guarantee period will be extended for up to 10 years to make it easier for lenders to extend repayment periods. The deadline for applying for all coronavirus related loans has been extended to 31 January 2021 and a successor loan scheme will be announced in the New Year.
Available from Monday 23 March, this scheme will be of fundamental importance for businesses. Many of the other measures announced will take time to set up and for repayments to be made – so this is an essential form of finance to keep business going in the meantime.
To qualify, businesses must have a turnover of less than £45m.
The scheme provides government-backed loans to enable such businesses to borrow more easily and at competitive interest rates.
Each business can borrow up to £5m on repayment terms of up to 6 years, and the loans are interest- and fee-free for the first 12 months.
Businesses should contact lenders directly, and a list of accredited lenders will be maintained on the British Business Bank website. A borrowing proposal will be required showing that the business would be considered viable were it not for the current pandemic.
Following reports of businesses struggling to obtain finance under the scheme, the Chancellor has taken the following action to maximise the support available:
- Confirmed that all businesses affected by Covid-19 can access the scheme, not just those who are unable to secure regular commercial financing;
- Stopped lenders from requesting personal guarantees for loans under £250,000 – guarantees for loans above this amount will be limited; and
- Made operational changes to speed up the approval process.
Coronavirus Bounce Back Loan Scheme
*Latest update*: repayment periods are now extendable from 6 to 10 years under the “Pay as you Grow” scheme. Business can choose to make repayments interest-only, and in cases of difficulty may be able to suspend repayment for up to six months without affecting credit scores. The application deadline has been extended to 31 January 2021.
Available from Monday 4 May, this scheme promises a faster access to loans of between £2-50k for small businesses.
There will be a simple online application process and the loans will be interest-free and repayment-free for the first 12 months.
A list of accredited lenders will be available from the British Business Bank in the same way as for CBILS.
Statutory Sick Pay (SSP)
Business with fewer than 250 employees (as at 28 February 2020) will be able to reclaim SSP from the government in relation to absences due to Covid-19 (illness or self-isolation) for up to 2 weeks per employee.
This will not be administered through the payroll, but a separate repayment mechanism will be set up.
Self-employed Income Support Scheme
*Latest update*: The scheme is being extended for a further six month period, covering 1 November 2020 to 30 April 2021. There will be two grants – the first three months representing 80% of average trading profits, capped at £7,500, and the second three months funding level to be announced. Claims for the first tranche will be able to be made from the end of November.
Self-employed people, including partners in a partnership, whose business profits have been adversely affected by the pandemic will receive taxable grants amounting to 80% of average monthly profits over the last three tax years, capped at £2,500 per month.
This was for a period of three months initially, but has now been extended for a further three months with a second round of applications to be available from August. For the second tranche, the grant is for 70% of average monthly profits over the last three tax years, capped at £2,190 per month and taxpayers must confirm they are adversely affected by the coronavirus on or after 14 July 2020.
If you have not yet claimed under the initial scheme you have until 13 July to do so.
Self-employed workers can continue to do business and remain eligible for grants. They must be trading at the point the application is made and intend to continue trading in 2020-21.
The scheme is targeted at those who need it the most. So, it will only apply if:
- Trading profits do not exceed £50,000;
- The majority of the taxpayer’s income is from self-employment; and
- The taxpayer reported self-employment income on their 2018/19 tax return.
The first two conditions can be with reference to 2018/19 alone, or on average across the three years 2016/17 – 2018/19.
For those taxpayers without a three-year history of profits, the average will be taken of the data that is available, i.e. potentially one or two years.
However, there is no support for those recently self-employed who started in business after 5 April 2019 because they have not yet filed any tax returns so no data is available in “the system”. Those traders will have to rely on the previously announced enhancements to the welfare system or loan schemes.
Self-employed people can also access Universal Credit at a rate equivalent to SSP.
Business rates and grants
All businesses in the retail, hospitality and leisure sector will pay no business rates for 2020-21.
Nursery businesses in England will also have a rates holiday for 2020-21.
Businesses in the retail, hospitality and leisure sector with a rateable value of between £15,000 and £51,000 will be eligible for a cash grant of up to £25,000.
All businesses which qualify for small business rates relief will be eligible for grants of £10,000 and should be contacted directly by their local authority (no need to apply for this).
We understand that the above measures will be automatically delivered by Local Authorities, with no need for businesses to formally claim them; however if you think you are eligible and have not heard anything do get in touch with them.
If you are not eligible for these grants, there are Discretionary Grants available from your local Council if you have been adversely affected by COVID19 and require additional support. A Kent and Medway COVID19 team has been set up and can be contacted directly on 03333 602300 to advise on the Discretionary Grants available in your area.
VAT, income tax and other tax payments
Update: VAT payments deferred to 31 March 2021 can now be spread over the financial year 2021/22 interest-free. To take advantage, businesses need to opt-in in the New Year. Self-assessment payments of tax due on 31 January 2021 will be eligible for a 12-month payment plan where the amount due is less than £30,000.
Any VAT payments due between 20 March and 30 June 2020 need not be made, and businesses will have until 31 March 2021 to repay the accumulated liabilities. No interest or penalties will be levied. This applies automatically to all UK businesses. If you pay your VAT by Direct Debit you will need to cancel this or the money will be automatically taken! Don’t forget to reinstate the instruction after the deferral period.
There is a temporary reduced-rating of VAT in place for the hospitality and tourism sectors until 31 March 2021.
Income tax payments on account due on 31 July 2020 are deferred until 31 January 2021 for all taxpayers. If you pay your tax by Direct Debit, you will need to cancel the instruction and then remember to reinstate it later.
We recommend that tax returns for 2019/20 are prepared as soon as possible after the tax year end so that future payments can be planned for, and any refunds due crystallised as soon as possible.
Finally, HMRC have a coronavirus helpline through which businesses can arrange extra time to pay any tax liabilities if they are in temporary financial distress as a result of the virus. Contact them before the liability becomes due on 0800 024 1222.
VAT filing deadlines are currently unchanged.
Companies House have automatically applied three-month extensions for accounts filing deadlines falling between 27 June 2020 to 5 April 2021 inclusive.