With COVID-19 continuing to impact on the operations of business we have seen several statements from the Government on the support that they are providing to businesses and individuals. CK are committed to updating our clients with all the latest information and have therefore summarised the various announcements below. We will update this page once further details are known.


Support for businesses

Coronavirus Job Retention Scheme

  • Available to any size of business in any sector.
  • This will be a grant to cover 80% of wages (up to £2,500 per month) for employees who are not working due to the impact of Coronavirus but are retained on the payroll.
  • Should businesses wish to top up the salaries they can.
  • This will be backdated to 1st March 2020 and will be open initially for a three month period.
  • There is no limit on funding available to the scheme.
  • To claim the grant businesses should contact HMRC and per the Chancellor the aim is for the first grants to be paid before the end of April.
  • Businesses will need to designate affected employees as ‘furloughed workers’ and notify employees of this change.
  • Information about the ‘furloughed workers’ and their earnings should be submitted to HMRC through a new online portal.
  • HMRC are working urgently to set up a system for reimbursement as existing systems are not set up to facilitate payments to employers.

Coronavirus Business Interruption Loan Scheme

  • Through British Business Bank (BBB) and is temporarily replacing the Enterprise Finance Guarantee.
  • The Government will provide lenders with a guarantee of 80% on each loan.
  • At the Budget it was announced that this would support loans of up to £1.2m this has subsequently been extended to £5m with no interest due for the first 12 months as the government will cover he first 12 months of interest payments.
  • Loans supported by the guarantee will be provided by commercial lenders in the usual way and the BBB has a list of lenders on the website.
  • To be eligible for the scheme the business:
    • Must be UK based with turnover of no more than £45m per year;
    • Meet the other BBB eligibility criteria which can be found on the website.
  • This will be available from Monday 23rd March.

Support for larger firms

  • Will be able to access a lending facility through the Bank of England providing ‘low cost, easily accessible commercial loans.’ Further details can be found on the Bank of England website.

Statutory sick pay

  • Refund for SME’s paying SSP for COVID-19 related absence.
  • Criteria
    • Employ less than 250 people as of 28th February 2020
    • Refund is for 14 days per employee
    • Employers should maintain records of staff absences, but employees will not need to provide a GP fit note.
  • The government will work with employers over the coming months to set up a repayment mechanism for employers as soon as possible as the existing systems are not designed to facilitate employer refunds for SSP.

Business Rates

  • The government is introducing a business rates holiday for retail, hospitality and leisure businesses in England for the 2020/21 tax year.
  • Any enquiries should be directed to the relevant local authority with guidance for local authorities being published by 20 March.

Grants

  • For businesses which qualify for small business rate relief or rural rate relief will receive a £10,000 cash grant. They will be contacted by the local authority and there is no need to apply.
  • A grant of £25,000 will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.

Tax liabilities

  • A dedicated helpline has been set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities. Through this businesses may be able to agree a bespoke Time to Pay arrangement. Dedicated helpline number 0800 0159 559.

VAT

  • VAT payments will be deferred for 3 months and this will apply from 20 March 2020 until 30 June 2020.
  • This is automatic and no application for this support is required.
  • During this period businesses will not need to make a VAT payment.
  • Businesses will be given until the end of the 2020/21 tax year to pay any liabilities that accumulate during the deferral period.
  • VAT refunds and reclaims will be paid by the government as normal.

Support for individuals

Statutory Sick Pay (SSP)

  • SSP to be paid from first day of sickness for those with COVID-19 or self-isolating. This also covers individuals who are caring for those with COVID-19 or self-isolating.

Hardship fund

  • A new £500m Hardship Fund has been announced so that Local Authorities can support economically vulnerable people and households. More detail on this funding will be announced shortly.

Mortgage payment holidays

  • The Chancellor confirmed that mortgage lenders will offer a three month mortgage holiday. UK Finance, the collective voice for the banking and finance industry, gave a statement about this and further details can be found on their website (link below).

Income tax for self-employed

  • Income tax self-assessment payments due on 31 July 2020 will be deferred until 31 January 2021.
  • No penalties or interest for late payment will be charged in the deferral period.
  • This is automatic support and no application is required.

Useful links

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