Business support package in England COVID-19
What the Government has put in place:
- £350 billion support package announced across the UK. (£330 billion as loans)
- Increased support available through tax credits and universal credits. At 14th April there had been 1.4 million new claims. Seven times the normal level.
Retail, hospitality and leisure Grant Fund (RHLGF) – qualification date 11th March 2020
For businesses in receipt of retail relief:
- £10k for businesses with a rateable value of <£15k
- £25k for businesses with a rateable value of between £15-51k
Small Business Grant Fund (SBGF)
£10k grant all businesses eligible for SBRR and RRR at 11th March 2020 eligible.
If businesses haven’t applied yet they need to go to: https://www.n-somerset.gov.uk/my-business/business-rates-payments/covid-19-business-grants/covid-19-grants/
North Somerset Council (Liberata) are making payments at a run-rate of 300 applications a day with all 3,500 eligible businesses due to be paid within the next week or so.
Liberata’s help desk: 01934 888143 should be contacted if businesses have any issues.
Coronavirus Job Retention Scheme (Furlough) – (qualification date now 19th March 2020)
- All UK businesses eligible and employees do not now have to confirm acceptance
- Government will pay up to 80% of the cost of a person’s salary up to £2,500 per month, plus Employer’s NIC and minimum employer’s pension contribution. Records must be kept
- Scheme covers cost of wages backdated to 1/3/20 and runs until 30/6/20
- Eligible for employees on any type of contract if paid through PAYE including zero hours, flexible, agency or temporary contracts and includes foreign nationals
- Employees who left due to redundancy or to start a new job which didn’t transpire because of COVID-19 can be rehired to be furloughed
- Someone who has more than one employer can be furloughed by one employer and continue to work for another, or can be furloughed by both employers
- Employees can be furloughed for a minimum of 3 consecutive weeks; can be removed from furlough to work and then re-furloughed again as long as the scheme is still operating
- Apprentices can be furloughed and can continue to train whilst furloughed
- Employees who are shielding in line with Government guidelines or can’t work because they have to provide child care can be furloughed
- Employees on sick leave or self-isolating should get SSP but can be furloughed after this
- Staff cannot be furloughed if their employer has gone into administration, unless it is likely a buyer will be found
- Directors who are paid via the PAYE system can be furloughed
- HMRC portal for businesses to register their furloughed staff opened 20th April.
Self-employment Income Support Scheme (SEISS)
Scheme to support self-employed individuals (inc. members of partnerships) who have lost income due to COVID-19
- Claim a taxable grant worth 80% of trading profits up to a maximum of £2,500 per month for 3 months (March to May – may be extended)
- Grant not a loan i.e. doesn’t have to be paid back but it will count towards taxable income next year
- You can continue to work whilst claiming SEISS and may be able to claim Coronavirus Job Retention Scheme or Universal Credit as well
- Self-employed profits must be less than £50k per year and they must make up more than half of total self-employed income
- Tax returns for the last 3 years will be used to see if they’re eligible
- Tax return for tax year 2018-19 needs to be submitted by today if you haven’t already done so
- Need to have earned self-employed income in the tax year 2019-20
- HMRC will calculate profits based on any tax returns over the last 3 years and they will make 1 payment to cover the whole length of the scheme some time in June
- HMRC will contact you by mid-May if you are eligible and invite you to apply online.
Business Rates Relief (BRR)
100% BRR for all retail, hospitality and leisure properties (inc. estate agents, letting agencies and bingo halls) for a 12 month period from April 2020. Automatic, no action needed.
New 100% government Bounce Back Loans scheme for small business
- businesses will be able to borrow between £2,000 and £50,000 and access the cash within days
- loans will be interest free for the first 12 months, and businesses can apply online through a short and simple form
- The scheme will launch for applications from Monday 4th May at https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan
Coronavirus Business Interruption Loan Scheme (CBILS and CLBILS)
- Available through participating lenders to businesses that are viable but who have short-term cash flow issues
- Loan will help them through the COVID-19 period with the Government providing lenders with a guarantee of 80% on each loan
- Government will also make a Business Interruption Payment to cover the first 12 months of interest payment and any lender-levied fees, so no upfront costs and lower initial repayment benefits to businesses
- £500m investment fund for high-growth UK companies in innovative and research intensive business sector
- Government loan ranging from £125k to £5m, subject to at least equal match funding from private investors
- Eligibility: business must be an unlisted UK registered company that has previously raised £250k in equity investment from third party investors in the last 5 years
- To be launched in May 2020 and will initially run until end September 2020
Support with tax payments
- Time to Pay – help with tax liabilities and HMRC will waive late payment penalties and interest if a business is struggling
- VAT deferral – No business will pay VAT up until mid-June and will have until the end of the financial year (April 2021) to repay VAT bills. Have to cancel Direct Debit with bank though, otherwise payment will be taken.
- Defer income tax payments due in July 2020 under self-assessment system until January 2021
Extra protection for businesses unable to pay rent due to COVID-19
Commercial tenants who are unable to pay their rent on time because of COVID-19 will be protected from eviction until 30 June 2020 – they remain liable for any rent due.
Coronavirus Statutory Sick Pay (SSP) Rebate Scheme
This scheme will repay employers with less than 250 employees, the current rate of SSP that they have paid to employees for period of sickness up to 2 weeks, starting on or after 13 March 2020.
Tax Relief for working from home
Employees working from home during the COVID-19 lockdown, can claim tax relief on £6 per week or employers can pay them £6 per week tax-free from 6th April. (Previously £4 per week)
Other forms of support
There are many other forms of personal support during the COVID-19 period eg:
- 3 month mortgage holidays. These have to be agreed with lender
- Loan and credit card holidays. You can apply up to 14th July
- Interest free overdraft facilities up to £500 from 14th April
- Some lenders doing automatically and going further, some you need to ask
- Good advice available on all the above at https://www.moneysavingexpert.com
There are many organisations offering funding during the COVID-19 period:
- Arts Council England – £160m Covid-19 Emergency Fund – deadline 30 April https://www.artscouncil.org.uk/covid19
- Quartet Community Foundation – Coronavirus Response Fund – available to charities and community groups supporting vulnerable and disadvantaged groups https://quartetcf.org.uk/grant-programmes/coronavirus-response-fund/
- National Lottery Heritage Emergency Fund – open 15 April – 30 June 2020 https://www.heritagefund.org.uk
- CAF Coronavirus Emergency Fund – funding for charities and social sector organisations – have paused fund but hoping to expand funding soon – https://www.cafonline.org/about-us/covid-19
- Charities Bank – https://charitybank.org/news/covid-19-resource-hub
- In North Somerset – https://innorthsomerset.co.uk
- Business West – https://www.businesswest.co.uk/trading-through-coronavirus
- Gov.UK – https://www.gov.uk/coronavirus/business-support
- HMRC – https://www.gov.uk/contact-hmrc
- Growth Hub – https://www.wearegrowth.co.uk
- BT Skills for tomorrow. Help with all kinds of on line skills training from BT, Google etc https://www.bt.com/skillsfortomorrow/business