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keep you updated on the government's latest announcements and advice for business. 

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27 April 2020 - Bounce Back Loan Scheme

Chancellor Rishi Sunak announced a new micro-loan scheme called Bounce Back Loans, which offers loans of 25% of a business’s turnover, up to a maximum of £50,000, with the Government paying 100% of the interest for the first twelve months.

Sunak promised there will be “no forward-looking tests of business viability; no complex eligibility criteria; just a simple, quick, standard form for businesses to fill in”, and said the loans should arrive within 24 hours of approval for most firms.

The scheme is due to open from 9am on 4 May 2020.

Measures have also been put in place to protect high street businesses against aggressive debt recovery actions. These include a temporary ban on the use of statutory demands made between 1 March 2020 and 30 June 2020, and on winding-up petitions presented from 27 April 2020 to 30 June 2020.

24 April 2020 -Business support finder

To find out what financial support is available to employers and the self employed affected by the coronavirus outbreak, the government has launched an online tool where you can check your eligibility for loans, tax relief and cash grants.

21 April 2020: Self-employment Income Support Scheme Update

HMRC has released further guidance on how to claim the Coronavirus (COVID-19) Self-employment Income Support Scheme. Please note the online service you will use to claim is not available yet. HMRC is aiming to contact claimants by mid May 2020 and will make payments by early June 2020.

20 April 2020: Job Retention Scheme Portal Now Open and Future Fund Announced for Startups

Today, 20 April 2020, the coronavirus job retention scheme (CJRS) portal opened, receiving 67,000 applications for furlough payments in the first ten minutes. It can be accessed via the gov.uk website. For more information about the scheme and how to claim please see our guidance.

CJRS was extended last week, up to the end of June. The cut-off date was also changed so it covers people on payroll on or before 19 March, instead of 28 February as originally announced.

A new scheme to support startups, called the Future Fund, was announced by Chancellor Rishi Sunak yesterday, 19 April. The £1.25 billion fund is designed to help firms not eligible for funding through existing coronavirus support schemes. It will provide loans to UK-based companies, from £125,000 to £5 million, as long as they’ve found at least equal funding from private investors. Further detail is expected soon but applications are expected to open in May. Your business may be eligible if:

  • it is based in the UK
  • has appropriate funding from private investors and institutions
  • has previously raised at least £250,000 in equity investment in the past 5 years.

Finally, in the past week councils have urged businesses notified of their eligibility for business support grants to complete their applications. Although at the time the grant schemes were announced businesses were told they would need to take no action, it is necessary to complete an application to receive this funding.

This video from Giles Mooney (tax commentator and provider of Morris Crocker's continued staff training) summarises the latest government measures as at 19 April 2020. 

3 April 2020: Business Interruption Loan Scheme

The coronavirus business interruption loan scheme for struggling businesses has been revamped.

In addition to the previous offering, it will offer state-backed loans of up to £25 million for larger firms with turnover of between £45m and £500m.

UK Finance said more than 130,000 loan enquiries had been made since the scheme opened, but less than 1,000 had been approved by banks.

In response, the Government will underwrite 80% of these loans to nudge banks into speeding up the provision of these emergency funds.

Banks will also be banned from asking company owners to underwrite loans of up to £250,000 with their own assets, such as property or savings.

2 April 2020: Job Retention Scheme - Contingent Workers

The coronavirus job retention scheme now applies to off-payroll contractors working for public-sector organisations.

Furlough can be offered to all public-sector workers, including those paid under PAYE, through an umbrella or their own personal service company.

1 April 2020: Making Tax Digital Deferral

The second phase of Making Tax Digital for VAT, which introduces more complex technology and stringent rules, has been deferred for 12 months.

New rules around the way digital firms link their MTD software and how they upload their VAT returns will now kick in on 1 April 2021.

27 March 2020: Job Retention Scheme Update

Full guidance has now been published setting out how businesses can claim through the coronavirus job retention scheme. Some key details are as follows:

  • Only employers that created and started a PAYE payroll scheme on or before 28 February 2020 are eligible.
  • The scheme covers full-time employees, part-time employees, employees on agency contracts and employees on flexible or zero-hour contracts.
  • Employees made redundant after 28 February 2020 but rehired by their employer can be furloughed.
  • Employees hired after 28 February cannot be furloughed.
  • To make a claim, employers will need to provide:
  1. ePAYE reference number
  2. number of employees being furloughed
  3. the claim period
  4. amount claimed
  5. bank account number and sort code
  6. contact name and number.

26 March 2020: Support for Self-Employed People, at last

Having been under pressure for the past week, Chancellor Rishi Sunak has announced measures to support self-employed people whose earnings have been affected by the coronavirus outbreak.

Self-employed income support scheme (SEISS)

  • Those who are already self-employed and facing financial difficulties are asked to apply.
  • The scheme will cover up to 80% of average profits over the past three years, up to £2,500 per month, for at least three months.
  • Those with average trading profits of more than £50,000 are not eligible.
  • Eligibility is determined with reference to earnings in 2018/19 as reported on tax returns filed this year.

What next? Application will be to HMRC via an online platform, yet to launch. The grants probably won’t be available until June 2020, backdated to 1 March. In the meantime, self-employed people who can’t work are expected to claim universal credit, access to which was broadened in the Spring Budget.

Updates from Wednesday 25 March 2020

Further to the news below that Companies House would automatically be giving those who need it a two-month extension on filing their accounts, the Government has now confirmed an automatic three-month extension for businesses that need it:

As part of the agreed measures, while companies will still have to apply for the 3-month extension to be granted, those citing issues around COVID-19 will be automatically and immediately granted an extension. Applications can be made through a fast-tracked online system which will take just 15 minutes to complete.

A new note has been added to the guidance on deferral of VAT payments reminding businesses that pay by direct debit to cancel if they want to defer payment:

Customers who normally pay by direct debit should cancel their direct debit with their bank if they are unable to pay. Please do so in sufficient time so that HMRC do not attempt to automatically collect on receipt of your VAT return.

Updates from Tuesday 24 March 2020

Fuller detail of the retail, hospitality and leisure grant (RHLG) fund has been published by the Department of Business, Energy and Industrial Strategy (BEIS). The guidance document, intended to help local authorities administer the scheme, is available on the Government website.

  • Payments will be made to the person listed in local authority’s records as the ratepayer for the business premises on 11 March 2020.
  • There is a strong warning against fraudulent claims with a promise of prosecution and clawback for any such payments.
  • Certain premises are excluded on the grounds of private use, such as private stables and beach huts. Car parks and parking spaces are also ineligible.
  • Businesses in liquidation or dissolved as of 11 March aren’t eligible either.

The Coronavirus Bill currently before Parliament now includes an amendment calling for support for the self-employed and freelancers in line with that being provided for employees under PAYE via the coronavirus job protection scheme. It was passed by the House of Commons last night and will now go to the House of Lords for scrutiny. 

Updates from Monday 23 March 2020

The Prime Minister addressed the nation at 20:30 announcing, to all intents and purposes, a total lockdown of the UK. Movements are to be restricted and non-essential shops are to close.

This means expected clarifications on how businesses can access support are likely to be delayed until later in the week.

As scheduled, however, the British Business Bank has published comprehensive details of how the coronavirus business interruption loan scheme (CBILS) can be accessed:

  • Eligibility: an SME must be UK-based with annual turnover of less than £45m and have a proposal which would be considered viable by the lender under normal circumstances.
  • Types of finance available: Term loans, overdrafts, asset finance, invoice finance.
  • How to apply: via one of the accredited lenders on this list. In the first instance, the British Business Bank is urging businesses to apply online and asking those who don’t need emergency finance to ‘consider the urgency of your need’. More detail is available here.

In other news, Companies House has confirmed that, in line with it’s existing rules, firms that were unable to file accounts on time can apply for a deadline extension, with an automatic two-month extension for those in isolation.

Summary of Government Support for Business (as of Friday 20 March 2020)

Between Spring Budget 2020 on 11 March and Friday 20 March the Government announced a series of measures designed to counter the threat posed to the UK economy by the outbreak of the coronavirus that causes the respiratory disease COVID-19.

On the evening of 20.03.2020 the Prime Minister announced further restrictions on the compulsory closure of bars, cafes, pubs and restaurants.

Alongside these new measures, the Chancellor announced a further package of support for businesses facing the prospect of having to reduce staff numbers.

Coronavirus job retention scheme

  • Grants of up to £2,500 per employee where those employees are unable to work (are ‘furloughed’) because of coronavirus, covering 80% of salary costs.
  • Intended to run for three months in the first instance with the first payments expected in early April and the scheme fully up and running by the end of that month.
  • The grants will be paid via HMRC.
  • All UK employers will be eligible.

What next? At present, no information has been provided on how to apply. Though it is generally understood to mean ‘stood down but still employed’, there is as yet no official definition of ‘furloughed’. It is unclear whether employers will be expected to make up the remaining 20% of salary.

Extension of the Coronavirus business interruption loan scheme (CBIL)

  • Maximum turnover for eligible businesses was previously set at £41 million per year; it has now been increased to £45m.
  • The interest-free period has been increased from six months to twelve.
  • The scheme is being managed by the British Business Bank but businesses will access them via one of 40 accredited lending providers, including most major banks.
  • The maximum value of a facility provided under the scheme will be £5 million – higher than the £1.2m announced initially.

What next? Discuss business plans with existing lending providers. Loans will be available from Monday 23 March 2020.

Deferral of tax and VAT payments currently due

  • VAT payments from UK-based VAT registered businesses due between 20 March and 30 June 2020 won’t need to be paid to the usual deadlines, with payment deferred until the end of the tax year.
  • Self-assessment income tax payments for the self employed which were due on 31 July 2020 can now be deferred until 31 January 2021.

What next? Both deferral schemes apply automatically with no application required.

Access to welfare for the self-employed

  • The minimum income floor for access to universal credit has been suspended for self-employed people affected by the economic impact of Coronavirus.

 

Latest news...

27/04/2020

Local authority grants for small businesses

According to recent news reports local councils still have funds to distribute to small businesses affected by the coronavirus outbreak and are trying all they can to make sure eligible businesses apply. Here is a

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REF: MC/NL/1.2