COVID-19 Businesses and Finances

Please find outlined below the measures to help business in the current situation.  HMRC are constantly updating their guidance and when I receive further updates from their team I will update this page to ensure we are all informed. Further measures for the self employed will be announced in the coming days.  I will keep you updated once we know more.   

JOB RETENTION

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

All UK businesses are eligible.

You will need to designate affected employees as ‘furloughed workers,’ and notify your employees of this change - changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.

Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.

VAT

HMRC will support businesses by deferring Valued Added Tax (VAT) payments for 3 months.

For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.

All UK businesses are eligible.

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.

SELF EMPLOYED

If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.   If you are self-employed you are eligible.

On the 26th March the Chancellor of the Exchequer announced self-employed people will be able to claim a grant from the Government worth 80% of the average monthly profits, up to £2,500 a month. These measures will remain in place for atleast three months and is amongst the most comprehensive packages in the world. 

SSP

Small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. this refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19

Employers with fewer than 250 employees will be eligible

Employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19

Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note.

The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible

You are eligible for the scheme if your business is UK based and your business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020

BUSINESS RATES

HMRC will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.

You are eligible for the business rates holiday if: your business is based in England and your business is in the retail, hospitality and/or leisure sector (such as shops, restaurants, cafes, drinking establishments, cinemas and live music venues for assembly and leisure, as hotels, guest & boarding premises and self-catering accommodation)

This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

HMRC will introduce a business rates holiday for nurseries in England for the 2020 to 2021 tax year.

You are eligible for the business rates holiday if: your business is based in England. Properties that will benefit from the relief will be hereditaments: occupied by providers on Ofsted’s Early Years Register / wholly or mainly used for the provision of the Early Years Foundation Stage

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

On 25th March the Government announced further measures regarding businesses in the hospitality and leisure sectors and to include Estate Agents: https://www.gov.uk/government/news/covid-19-estate-agents-lettings-agencies-and-bingo-halls-to-pay-no-business-rates-this-coming-financial-year 

GRANTS

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property. For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000. For businesses in these sectors with a rateable value of between £15,001 and £51,000, they will receive a grant of £25,000.

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs. You are eligible if your business is based in England, you are a small business and already receive SBBR and/or RRR and you are a business that occupies property

You do not need to do anything. Your local authority will write to you if you are eligible for these grants. Guidance for local authorities on the scheme will be provided shortly.

BUSINESS LOAN INTERUPTION SCHEME

A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will support primarily small and medium-sized businesses to access bank lending and overdrafts.

The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value.

You are eligible for the scheme if: your business is UK based, with turnover of no more than £45 million per year. your business meets the other British Business Bank eligibility criteria

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks will offer the Scheme once it has launched. There are 40 accredited providers in all.

You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

TAX – TIME TO PAY:

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

You are eligible if your business:. pays tax to the UK government AND has outstanding tax liabilities

How to access the scheme: If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.