Covid-19: A guide to government help.
Coronavirus is all consuming right now. It’s consuming our businesses and the way we run our lives. Day-to-day we hear new advice as uncertainty looms and for businesses across the UK, including our own, could this be our darkest hour? In response to the turbulent economic landscape, the BBC reported yesterday 19 March 2020 that the Governor of Bank of England, Andrew Bailey, took the decision to cut interests rates for a second time in just over a week, bringing them down to 0.1% from 0.25%. Interest rates are now at their lowest ever in the Bank’s 325-year history. This decision coincided with additional measures announced by Chancellor Rishi Sunak in the Budget to help businesses survive this crisis. Even today, 20 March, Rishi Sunak is to announce an employment and wage subsidy package to help protect millions of jobs.
With so much noise in the media, it’s difficult to know exactly how your business will be looked after. However, our Non Exec Director Ian Traynor from Luminate Ventures shares the advice he received from the Chambers of Commerce.
Contact HMRC and request to defer your tax payments (including VAT) for 2 months. In effect this is free credit to help with potential cash flow issues.
Banks and Loans
Banks are also increasing credit lines and overdrafts and in some cases they may even offer repayment holidays. Businesses should be encouraged to contact ALL of their credit suppliers to ask about relaxing payments.
Coronavirus help for self-employed
For the self-employed not eligible for SSP, contributory Employment and Support Allowance will be payable, at a rate of £73.10 a week if you are over 25, for eligible people affected by coronavirus or self-isolating in line with advice from day one of sickness, rather than day eight.
For more information about coronavirus government statutory sick pay, go to the Department for Work & Pensions website here.
Covering Sick Pay
For businesses with fewer than 250 employees, the cost of providing 14 days of statutory sick pay per employee will be refunded by the government in full. This will provide 2 million businesses with up to £2 billion to cover the costs of large-scale sick leave. Coronavirus statutory sick pay is expected to be in the form of a refund. The Treasury says that it is “working with employers over the coming months to set up a repayment mechanism as soon as possible for employers reclaiming statutory sick pay”.
Do you get Small Business Rates Relief?
There is also a £3,000 cash grant being made available to 700,000 of our smallest businesses, which will be delivered by Local Authorities, and worth a total of £2 billion. Your local council will have further information on this as the scheme is rolled out. You can find your local authority here .
A Coronavirus Business Interruption Loan Scheme has been introduced. Businesses with a turnover of less than £41 million can apply for a loan of up to £1.2 million, with the government covering up to 80% of any losses with no fees. The Coronavirus Business Interruption Loan Scheme (CBILS) temporarily replaces the Enterprise Finance Guarantee Scheme and will be provided by the British Business Bank through accredited lenders. To apply visit this website and follow the information provided.
A helpline has also been set up to help businesses and self-employed individuals with outstanding tax liabilities receive support with their tax affairs. Through this, businesses may be able to agree a bespoke ‘time to pay’ arrangement. If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s helpline on 0800 0159 559. We would also like to point you to GOV.UK for extra guidance and support from our government. Click here for more information.