COVID-19

1st April – Update from Alok Sharma Business Secretary

The coronavirus is the biggest threat we have faced in decades. The Government do recognise the extreme disruption this has brought to lives, businesses, jobs and the nation’s economy.

The Business Secretary said he wanted to thank businesses too, because through their support for their workers, the community and the NHS they are making a difference. Thousands of businesses large and small have all worked with staff to ensure they are supported in the days, weeks and months ahead with Health and Safety measures, home working, furloughing and holiday arrangements. Thanks to all these businesses that are working to keep our Economy going and supporting our people. The Government wants to support our businesses and as you will be aware from today rates relief and grants have kicked in. Money has been given to local authorities and this MUST be given to businesses as soon as possible.

The High Street banks are working really hard to support the UK through this time with mortgage holidays, increase in credit facilities and loans to businesses are also being issued through the Coronavirus Business Interruption Loan Scheme since it came in to operation.

Banks have been urged to ensure that the benefits of the loan scheme are passed to businesses and consumers, it is completely unacceptable if any bank unfairly refuses funds to good businesses in financial difficulty. The Government will work with the banks to do everything they can to support the businesses and the people of the UK in their time of need and they are looking at ways these businesses can get the support they need.

Together we will pull through.

26th March – Update Coronavirus update from the Chancellor for help being offered to the self-employed

In the Chancellor’s speech he announced the next step in our economic fight against COVID–19?

The self-employed need not to be forgotten, need not to be left behind and we must all stand together. His action plan to beat the pandemic has now been further widened to cater for the self-employed and as such he introduced his New Self-employed Income Support Scheme.

In summary the New Self-employed Income Support Scheme will be generous, deliverable and fair

  • Provide a taxable grant of up to £2500 per individual per month
  • The grant will be based on 80% of the average profits for the last three tax years. If you do not have three years they will look at the average of what you have got but will not look at any cases where no 2019 self-assessment tax return has not been submitted.
  • The support will be targeted and hit those most in need.
  • It will be open to anyone whose majority income is from self-employment and whose trading profits are less than £50k
  • You will only be eligible if you have submitted a self-assessment tax return for 2019 so for those that have not done this yet the Chancellor has given four weeks from today to submit your SATR
  • The scheme will run for three months (at the moment) and will be back dated to 1 March 2020.
  • The self-employed can continue to work AND make this claim
  • Due to the complexities the scheme will not accessible until June 2020
  • If eligible HMRC will contact you directly, ask you to fill out a form to apply, HMRC will verify your claim and then pay out your grant (3 months (March, April and May) directly in to your bank account.

So what help is available now?

  • The self-employed can access the Coronavirus Business Interruption Loan Scheme
  • Defer payment of their second instalment of tax due in July to 31 January 2021
  • Make a Welfare System Claim – they can get an advance payment on their Universal Credit immediately after they have made their claim
  • Local authorities are helping those with most need with regards to their council tax.

Unprecedented measures for unprecedented times!

26th March – Update 

Estate Agents, Letting Agents and Bingo Halls to pay no business rates this coming financial year.

Estate Agents, Letting Agencies and Bingo Halls that have closed as a result of COVID-19 measures to restrict the spread of the virus will now be exempted from business rates in 2020-21.

Eligible businesses will be re-billed by their local authority and the new bill will give them a discount of 100%. Any payments made will also be refunded by the local authority.

25th March – Update for the Self-Employed

Statutory Self-Employment Pay

As part of the Coronavirus Bill being discussed in Parliament we have observed the following. Nothing has been released by the Government but it does look like something will be done to help the Self-Employed through the Coronavirus pandemic.

  • A scheme must be introduced for Statutory Self-Employment Pay
  • Provision to be made out of Public funds to individuals who are
    • Self-Employed
    • Freelancers
  • Payments to be set so that the net monthly earnings of an individual do not fall below
    • 80% of their monthly net earnings averaged over the last three years or
    • £2917

(Whichever is lower)

  • No payment will exceed £2917 per month

So please watch this space for a formal announcement of measures anticipated by the end of this week.

25th March – Update for Landlords and Tenants

For many rent is one of the most, if not the most significant outgoing. In the current climate some tenants may not have the funds to make a payment. With a quarterly rent payment now due this could have a significant impact.

In addition to the Government Assistance to businesses and individuals we thought we should highlight the options available to the landlord and the tenant to help create some practical suggestions for moving forward.

For landlords

  • Will your tenant be paying the rent on the due day?
  • If not, when will the tenant be able to pay?
  • Have you seen management accounts and future cashflow projections?
  • Can the tenant offer you any security?
  • Is your tenant eligible for Government Assistance and do they know about it?
  • Are you eligible for Government Assistance?
  • Have you considered offering a time to pay arrangement, payment holiday or rent reduction?

For Tenants

  • Bring your financial affairs up to date.
  • Do you have current management accounts and an up to date cashflow forecast?
  • Have you asked your landlord for a payment holiday or time to pay?
  • Have you asked your landlord for a rent reduction?
  • Are you eligible for Government Assistance and have you applied?

Communication and negotiation are key from all sides, with the inevitable downturn in the economy caused by Covid-19 businesses will fail and units will be left empty. Is having a tenant that covers the outgoings of a unit more preferable to having no tenant at all?

Do your sums and communicate with each other now, before it is too late. Whatever you agree now does not have to last forever.

23rd March – Update

Useful numbers to contact:

• 0300 200 3814 – Time to Pay – this helpline will allow you to set up a payment plan
• 0800 0159 559 – If the Coronavirus has affected you as a business

Or contact our Covid-19 helpline for more advice.

Coronavirus Business Interruption Loan Scheme

Coronavirus Business Interruption Loan Scheme (CBILS) will provide facilities up to £5m for smaller businesses across the UK who are experiencing lost or deferred revenues, leading to disruption to their cashflow.

CBILS supports a wide range of business finance products including term loans, overdrafts, invoice and asset finance. The scheme provides the lender with a government backed guarantee potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’. The borrower always remains 100% liable for the debt.

Up to £5m facility is the maximum provided under the scheme and will be available on repayment terms of up to six years for term loans and asses finance. For overdrafts and invoice finance facilities terms will be three years. There is no guarantee fee for SME’s to access the scheme for smaller businesses.

Interest and fees will be paid by the government for twelve months therefore no upfront costs and lower initial repayments.

At the discretion of the lender, the scheme may be used for unsecured lending for facilities of £250k and under. The borrower always remains 100% liable for the debt.

To be eligible for a facility under CBILS and SME must

  • Be UK based in its activity with an annual turnover of less than £45m.
  • Have a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable the business to trade out of any short to medium term difficulty

CIBLS is available through the British Business Banks forty accredited lenders. In the first instance businesses should approach their own provider – ideally via the lenders website. They may also consider approaching other lenders if they are unable to access the finance they need.

NOTE – If the accredited lender can offer finance on normal commercial terms without the need to use the scheme they will do so.

CBILS will initially run for six months.

Sole traders and freelancers are eligible as long as the business activity is operated through a business account.

We are expecting further announcements today on the CBILS and also further measures to help the self-employed.

20th March – Update

Update from the Chancellor on the help from the Government – 20 Mar 2020

The Prime Minister and the Chancellor stated that the Government – ‘Will stand by you.’

These times are unprecedented and the measures are comprehensive. It is a collective national effort with a role for people, businesses and the Government.

The Chancellor has already put forward a significant combination of measures and today he has added to those with arrangements to protect jobs and incomes, offering support where needed to help the employed and the self- employed. The Government is to help pay wages.

  • They have introduced the Coronavirus Job Retention Scheme and this is open to any employer.
  • A grant will be given to cover wages for those kept on the payroll. This grant will be 80% of the salary (up to £2500 per month) per employee for the retained workers.
  • To claim this grant you will need to contact HMRC
  • It will cover wages back dated to 1 March 2020 for 3 months initially or longer if necessary.
  • There is no limit to supporting as many jobs as necessary
  • HMRC are working day and night to get the scheme up and running and it is hoped they should be in a position to pay grants before the end of April 2020

Other measures have been updated

  • The Coronavirus Business Interruption Loan Scheme is now interest free for 12 months (not 6 months as previously stated) and these loans will be available from Monday (23 March 2020). These funds are unlimited.
  • To support cash flow for businesses HMRC has deferred the next VAT quarters payment (up to 30 June 2020) and businesses have until the end of the financial year to pay these.
  • Universal Credit Standard Allowance has been increased by £1000 per annum for the next 12 months
  • Working Tax Credit Basic Element has also been increased by £1000 per annum for the next 12 months
  • The minimum income floor has been suspended allowing the self-employed to access Universal Credit at the same rate as employees.
  • For the self- employed the next self-assessment payment has also been deferred until January 2021
  • To help ‘renters’ there will also be an increase in Housing Benefit and the Local Housing Allowance
  • If you are on a zero hour contract then you will be covered by the benefits if you are in a PAYE scheme but this will also be dependent on your particular circumstances
  • Charities have been supported by the above measures and the business rates assistance
  • Voluntary and Community Groups are being reviewed to see how help can be provided.

Lots more to consider and take on board. Do contact the Covid-19 helpline to find out more.

20th March – Individuals Update

Covid – 19 advice and guidance for individuals

INFORMATION FOR INDIVIDUALS

If you think you are entitled to Statutory Sick Pay (SSP), please read the following information:

You can get £94.25 per week Statutory Sick Pay (SSP) if you’re too ill to work. It’s paid by your employer for up to 28 weeks.

If you are self-isolating because of COVID-19:

From 13 March, you can now claim SSP. This includes individuals who are caring for people self-isolating in the same household and therefore have been advised to do a household quarantine. To check your sick pay entitlement, you should talk to your employer, and visit https://www.gov.uk/statutory-sick-pay for more information.

  • When does SSP apply? The government is legislating for SSP to be paid from day 1, rather than day 4, of your absence from work if you are absent from work due to sickness or need to self-isolate caused by COVID-19. Once the legislation has been passed, this will apply retrospectively from 13 March. You should talk to your employer if you are eligible for SSP and need to claim.
  • Do I need a sick note? From Friday 20 March onwards, those who have COVID-19 or are advised to self-isolate will be able to obtain an “isolation note” by visiting NHS 111 online and completing an online form, rather than visiting a doctor. For COVID-19 cases this replaces the usual need to provide a “fit note” after seven days of sickness absence. Isolation notes will also be accepted by Jobcentre Plus as evidence of your inability to attend.
  • What if I am self-employed or not eligible for SSP? If you are not eligible for SSP – for example if you are self-employed or earning below the Lower Earnings Limit of £118 per week – and you have COVID-19 or are advised to self-isolate, you can now more easily make a claim for Universal Credit (UC) or new style Employment and Support Allowance. For more information on how to claim, please visit https://www.gov.uk/universal-credit and https://www.gov.uk/guidance/new-style-employment-and-support-allowance.
  • What if I am self-employed and receiving Universal Credit? If you are self-employed and receiving Universal Credit and you have COVID-19 or are advised to self-isolate, the requirements of the Minimum Income Floor will be temporarily relaxed. This change took effect on 13 March and will last for the duration of the outbreak, to ensure that self-employed UC claimants will receive support. If you need to claim Universal Credit but have COVID-19 or are self-isolating, you will now be able to claim and to access advance payments upfront without needing to attend a Jobcentre Plus. Please visit https://www.gov.uk/universal-credit for more information. If you need to claim Universal Credit but have COVID-19 or are self-isolating, you will now be able to claim and to access advance payments upfront without needing to attend a Jobcentre Plus. Please visit https://www.gov.uk/universal-credit for more information.

If you are eligible for new style Employment and Support Allowance, it will now be payable from day 1 of sickness, rather than day 8, if you have COVID-19 or are advised to self-isolate.

 If you think you may need financial support from your Local Authority in England, you may be entitled to support from the £500 million Hardship Fund:

  • Most of this funding will be used to provide more Council Tax relief, either through existing Local Council Tax Support schemes, or through similar measures.
  • The Ministry for Housing, Communities and Local Government (MHCLG) will set out more detail on this funding, including allocations, shortly.
  • If you have any questions, please contact your Local Authority.

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 COVID19, 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.

20th March – Business Update

Covid – 19 Support for Businesses (update 19 March 2020)

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:

  • a Statutory Sick Pay relief package for SMEs
  • a 12-month business rates holiday for all retail, hospitality and leisure businesses in England
  • 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
  • the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
  • a new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
  • the HMRC Time To Pay Scheme

Support for businesses who are paying sick pay to employees

We will bring forward legislation to allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The eligibility criteria for the scheme will be as follows:

  • 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 – the size of an employer will be determined by the number of people they employed as of 28 February 2020
  • 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
  • eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force
  • the government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible

Eligibility

You are eligible for the scheme if:

  1. Your business is UK based.
  2. Your business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020.

How to access the scheme

A rebate scheme is being developed. Further details will be provided in due course once the legalisation has passed.

Support for businesses that pay business rates

Business rates holiday for retail, hospitality and leisure businesses

We 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.

Eligibility

You are eligible for the business rates holiday if:

  1. Your business is based in England.
  2. Your business is in the retail, hospitality and/or leisure sector.

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

How to access the scheme

There is no action for you. 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.

You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.

Further guidance for local authorities is available in the expanded retail discount guidance.

Cash grants for retail, hospitality and leisure businesses

A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.

Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.

Support for businesses that pay little or no business rates

The government will provide additional funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR). This will provide a one-off grant of £10,000 to businesses currently eligible for SBRR or rural rate relief, to help meet their ongoing business costs.

Eligibility

If your business is eligible for SBRR or rural rate relief, you will be contacted by your local authority. You do not need to apply.

How to access the scheme

Funding for the scheme will be provided to local authorities by government in early April. Guidance for local authorities on the scheme will be provided shortly.

Support for businesses through the 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.

Businesses can access the first 6 months of that finance interest free, as government will cover the first 6 months of interest payments.

Eligibility

You are eligible for the scheme if:

  1. Your business is UK based, with turnover of no more than £41 million per annum.
  2. Your business meets the other British Business Bank eligibility criteria.

How to access the scheme

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.

Support for larger firms through the COVID-19 Corporate Financing Facility

Under the new Covid-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies.

This will support your company if it has been affected by a short-term funding squeeze, and allow you to finance your short-term liabilities.

It will also support corporate finance markets overall and ease the supply of credit to all firms.

Eligibility

All UK businesses are eligible.

How to access the scheme

The scheme will be available early in week beginning 23 March 2020.

We will provide information on how to access the scheme here shortly.

More information is available from the Bank of England.

Support for businesses paying tax: 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.

Eligibility

You are eligible if your business:

  • pays tax to the UK government
  • 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.

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

18th March 2020 – update

In yesterday’s update the big news was the £350bn package to support businesses and the key points in that announcement were;

  • Contact your banks first, they have been instructed to work with businesses to support them through the crisis and will provide flexibility and understanding’

Business Interruption Loans

  • Small and medium businesses will now be able to apply for government backed loans up to £5m – full details will be available from 23 March 2020
  • There will be no interest due in the first six months.

Business Rates

  • Further help will be provided to the retail, hospitality and leisure industries
  • Businesses with a rateable value of less than £51k will not only have no rates to pay but will also be entitled to a cash grant of up to £25k for each business
  • All businesses in the retail, hospitality and leisure industries irrespective of rateable value will have no business rates to pay for one year

Cash Grants

  • These are available to very small businesses and have now been increased from the £3k announced in the Budget to £10k

Further announcements will be made and we will continue to update our website with the latest news and how it will impact you.

Contact HMRC’s new dedicated Covid – 19 helpline for advice and support – 0800 0159 559

In the meantime do contact your own bank to see what support they are offering and also do make other enquiries. Or if you want to discuss anything with us please contact us.

17th March 2020 – update

In the March 2020 Budget, the government announced a raft of measures to help businesses and individuals during the current Coronavirus crisis, many of which seemed complex, so we have summarised the key points below:

The UK Government has announced a package of measures to support SME businesses and Self-employed individuals affected by the Coronavirus outbreak.

These measures include

  • Business Rates Reliefs
  • Business Interruption Loan and Grant Schemes
  • An extension of statutory sick pay (SSP)
  • A dedicated helpline for businesses seeking a deferral of tax liabilities

Business Rates Reliefs

  • The Business Rates Discount Scheme has been extended from the 50% planned for 2020/21 to 100% for one year
  • The relief is available to leisure and hospitality sectors with a rateable value of less than £51k
  • Planned rates discount for pubs with a rateable value below £100k will be increased to £5k from the current £1k
  • Businesses that have already received the retail discount in 2019/20 will be rebilled by their local authority but those newly eligible will need to apply for the discount from their local authority
  • Small businesses that currently pay little or no business rates (because they receive small business or rural rate relief) will be entitled to a one off grant of £3k from their local authority to help meet their business costs

 Business Interruption Loan and Grant Schemes

  • A new temporary coronavirus Business Interruption Loan Scheme will be made available through the British Business Bank in the next few weeks
  • Loans up to £1.2m will be available to businesses
  • The Government will guarantee 80% of each loan at no charge to the business or bank (usually 2%)
  • Interest rates will be similar to existing bank lending

An extension of statutory sick pay (SSP)

  • SSP will now be available for eligible individuals diagnosed with Covid – 19 for those who are unable to work because they are self-isolating in line with Government advice.
  • SSP will be payable from day one instead of day four for infected individuals
  • Those not eligible for SSP, for example those who are self-employed or people earning below the lower earnings limit of £118 per week can now more easily make a claim for Universal Credit or Contributory Employment and Support Allowance;
    • People will be able to claim Universal Credit and access advance payments upfront without the current requirement to attend a jobcentre if they are advised to self-isolate
    • Contributory Employment and Support Allowance will be payable for eligible people affected by Covid – 19 or self-isolating from day one of sickness rather than day eight
  • Legislation will be brought forward to allow SME’s and employees to reclaim SSP. The eligibility criteria will be;
    • Refund (just under £200) will cover up to two weeks SSP per eligible employee who has been off work because of Covid – 19
    • Employers with fewer than 250 employees on 28 February 2020will be eligible
    • Employers will be able to reclaim expenditure for any employee who has claimed SSP as a result of Covid – 19
    • Employers should maintain records of staff absences, but employees will not need to provide a GP note

Dedicated helpline for businesses seeking a deferral on tax liabilities

  • All businesses and self-employed people in financial distress with outstanding tax liabilities may be able to agree additional time to settle their tax affairs through HMRC’s ‘Time to Pay’ scheme, for which a dedicated helpline has been set up.
  • These arrangements are agreed on a case-by-case basis and are tailored to individual’s circumstances and liabilities.
  • During the coronavirus outbreak the usual 3.5% annual interest on deferred tax payments will be waived

There is more information available on the HMRC’s new dedicated Covid – 19 helpline – 0800 0159 559.

If you want advice on how this will affect you and how to take advantage of the support contact us.