CORONAVIRUS (COVID-19) SUPPORT FOR BUSINESSES

The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19. This includes a package of measures to support businesses including:

• Coronavirus Job Retention Scheme
• Deferring VAT and Income Tax payments
• Statutory Sick Pay relief package for SMEs
• 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England & Wales
• Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
• Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
• Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
• HMRC Time To Pay Scheme

CORONAVIRUS JOB RETENTION SCHEME:

All UK businesses are eligible and 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. Employers can pay the additional 20% but do not have to. HMRC are working urgently to set up a system for reimbursement.

The scheme will cover the cost of wages backdated to 1st March 2020, even for those workers already laid off, (if they are re-employed) and will be open for 3 months initially, although this may be extended.

We are also still waiting on guidance as to how things will work in practice, especially as employers will be required to pay the staff first and then claim back the 80% from HMRC.

DEFERRING VAT PAYMENTS:

All UK businesses are eligible and the deferral will apply from 20 March 2020 until 30 June 2020.

This is an automatic offer and businesses do not have to apply for it – as far as we know at the moment, businesses would still be required to submit their VAT returns as normal, with refunds continuing to be paid.

Businesses will be given until the end of the 2020/21 tax year to pay any accumulated liabilities.

DEFERRING INCOME TAX PAYMENTS:

All Self Employed people are eligible and allows you to defer your July 2020 payment on account until 31 January 2021.

This is an automatic offer and you do not have to apply for it. The offer may be extended to other Income Tax payers but no guidance has been issued yet.

SUPPORT FOR SICK PAY:

All small or medium sized UK Businesses are eligible, and a rebate scheme is currently being developed. Further information will be provided as soon as we can.

Employees can now claim SSP from Day 1 rather than Day 3 and are eligible for this even they do not have symptoms, e.g. if they chose to Self Isolate or live with someone who has symptoms.

Employers with less than 250 employees (as of 28 Feb 2020) will be eligible to reclaim expenditure for any employee who has claimed SSP as a result of COVID-19, which will cover up to 2 weeks SSP per eligible employee.

Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website.

RETAIL, HOSPITALITY AND LEISURE BUSINESSES WHO PAY RATES – 2020/21 HOLIDAY:

There will be a business rates holiday for retail, hospitality and leisure businesses in England & Wales for the 2020/21 tax year.

If you have recently received your 2020/21 rates bill then rest assured that it will be reissued as soon as possible. Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

• 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 is an automatic relief and will apply to your next rates bill in April 2020.

RETAIL, HOSPITALITY AND LEISURE BUSINESSES WHO PAY RATES – GRANTS:

Grants will be available for retail, hospitality and leisure businesses in England & Wales.

• If your rateable value is under £15,000 then you will receive a grant of £10,000
• If your rateable value is between £15,001 and £51,000 then you will receive a grant of £25,000

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

• 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 is an automatic relief and your local authority will write to you if eligible. The initial guidance indicated that these grants would start coming through in April but any queries regarding eligibility etc should be directed to your local authority

OTHER BUSINESSES WHO PAY LITTLE OR NO RATES – GRANTS:

Small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief are eligible for a one-off grant of £10,000.

This is an automatic relief and your local authority will write to you if eligible. The initial guidance indicated that these grants would start coming through in April but any queries regarding eligibility etc should be directed to your local authority.

CORONAVIRUS BUSINESS INTERRUPTION LOAN SCHEME:

A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to 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.

The scheme will be available from early next week commencing 23 March.

HMRC TIME TO PAY SERVICE:

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.

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.

If you’re worried about a future payment, please call them nearer the time.

HMRC TIME TO PAY SERVICE:

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.

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.

If you’re worried about a future payment, please call them nearer the time.

SELF EMPLOYED WORKERS:

So far, the only guidance which has been issued for Self Employed workers has been to claim benefits (where eligible) although there may be further support packages announced as time goes on.

The requirements of the Minimum Income Floor have been temporarily relaxed and you can now claim online without having to visit a JobCentre Plus. Please visit https://www.gov.uk/universal-credit for more information.

OTHER INFORMATION IF YOU ARE EXPERIENCING FINANCIAL DIFFICULTIES:

If you are experiencing financial difficulties meeting your mortgage repayments because of COVID-19, you may be entitled to a mortgage or rental holiday for 3 months. This includes if you are a landlord whose tenants are experiencing financial difficulties because of COVID-19. If you are a tenant experiencing financial difficulties because of COVID-19, the government will ensure you do not face the threat of eviction for at least 3 months:

• the government has agreed with mortgage lenders that they will offer repayment holidays of 3 months to households in financial difficulty due to COVID-19
• this will also apply to landlords whose tenants are experiencing financial difficulties because of COVID-19
• the offer of a payment holiday can be made available to customers who are up to date with payments and not already in arrears
• customers who are concerned about their current financial situation should contact their lender at the earliest possible opportunity to discuss if this is a suitable option for them
• emergency legislation will be taken forward so that landlords will not be able to start proceedings to evict tenants for at least a 3 month period. This applies to private and social renters
• at the end of this period, landlords and tenants will be expected to work together to establish an affordable repayment plan, taking into account tenants’ individual circumstances

If you are experiencing difficulties paying back personal loans or credit card bills as a result of COVID-19, you should read the following information:

• the Financial Conduct Authority (FCA) called on lenders to use flexibility built into their rules to support consumers, taking into account customers’ individual circumstances. Many major lenders have already made statements to this effect
• if you are experiencing difficulties paying back loans or credit card bills because of COVID-19, you should talk to your lender
• if you agree a payment holiday with your lender, they should record these in such a way that will not impact on your credit score

WHERE TO GO FOR UPDATES:

The Government and HMRC are working together to keep us all updated as much as possible and have urged that we visit their dedicated support page throughout the coming weeks as this will be updated on a daily basis.

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses#support-for-businesses-through-the-coronavirus-job-retention-scheme