With the ongoing and rapidly changing pandemic, we thought it may be useful to quickly and concisely list down the support available to SMEs
The following link is the main source of up to date government information;
CORONOVIRUS BUSINESS SUPPORT
The following advice has been made available and we will continue to update it as more information about accessing the funding becomes available:
Coronavirus Job Retention Scheme
- Designate affected employees as ‘furloughed workers’ and inform HMRC.
- HMRC will reimburse 80% of furloughed workers wage costs up to £2,500 per month.
- This is aimed at employees who otherwise would have been made redundant and ‘furloughed workers’ cannot work during this time.
- You will have to inform HMRC of each ‘furloughed workers’ earnings through the portal once it is live.
- Systems are currently being set up to facilitate this reimbursement.
VAT Payments
- Have until the end of the 2020/2021 tax year to pay any liabilities, the payment can be spread out over this time.
- If you have a direct debit set up this can be cancelled.
- Automatically deferred from 20/03/2020 until 30/06/2020
Income Tax Payments
- Income tax self-assessment payments due on 31/07/2020 will be deferred until 31/01/2021.
- Eligible if self-employed.
- Applies automatically.
Statutory Sick Pay
- Paid to employees from day one.
- Reclaim SSP from the government if employees are off due to Covid-19.
- Covers up to 2 weeks SSP.
- Eligible to companies with fewer than 250 employees at 28/02/2020.
- Repayment mechanism will be set up in the coming months.
Retail, Hospitality and Leisure business support.
- Business rates holidays for retail, hospitality and leisure businesses for 2020 – 2021 tax year.
- Grants are available between £10k - £25k depending upon rateable value.
- This will be done automatically via the local authority.
Small Business Grant funding
- £10k grant is available for any business that claim Small Business Rates Relief or Rural Rates Relief.
- Your local authority will contact you.
Coronavirus Business Interruption Loan Scheme (CBILS)
- Interest free loans for the first 12 months.
- Up to £5m available on repayment terms up to 6 years for term loans and asset finance and up to 3 years for overdrafts and invoice finance facilities.
- Loans are 80% guaranteed by the government.
- SME’s will benefit from no upfront fees and lower initial reapyments.
- Turnover must be below £45m per annum, the business must generate more than 50% of turnover from trading activity and it must be used to support primarily trading in the UK.
- The borrower will always remain 100% liable for the debt.
- Accessed through approved lenders on BBB behalf – use below link to obtain details.
Bank of England lending facility
- Bank of England will buy short term debt of a minimum of £1m nominal from larger UK companies for at least 12 months, with a 6 month notice of withdrawal for the facility.
- To be eligible the company must be non-financial UK incorporated company. The company's revenue, UK customer base and number of UK sites will be taken into account. The company must have been in good financial health prior to 01/03/2020.
- Contact your bank to find out what support is available for you.
HMRC Time to Pay Scheme
- If you have outstanding tax liabilities you may be eligible to receive support with arrangements made on a case by case basis.
- Call HMRC’s dedicated line on 0800 0159 559 to discuss tax payment deferral.
Filing Accounts on Companies House
- If you require additional time to file your accounts you must apply for more time.
- If you are late filing accounts and have not submitted an application to extend the deadline than a penalty charge will apply.
- Link for filing the application can be found below.
Protection from eviction
- Commercial tenants who cannot pay rent due to Coronavirus will be protected from eviction.
- Resulting in no business automatically forfeiting their lease and being forced out of the premises if they miss payment up until 30th June 2020.
- This is not a rental holiday and all commercial tenants remain liable for the rent.
- No action is required and the change will come in to force once the Coronavirus Bill receives Royal Assent.
Useful links include:
- https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses
- https://www.cbi.org.uk/events/daily-coronavirus-webinar-1/
- https://www.gov.uk/guidance/apply-for-more-time-to-file-your-companys-accounts
It is important to contact your bank to see what support they can provide and also to check your insurance documentation to see if it covers business disruption due to pandemics and government-ordered closures.
We are aware that the CBILS is not suitable for pre-revenue, early stage and low revenue generating start-ups however industry leaders including the UKBAA are working to gain the governments support for alternative finance/ tax mechanisms. This will help to leverage the government support and equity in order to provide a robust funding platform for our SME’s and boost the market. This is especially important since the CBILS does not limit SME’s ability to access EIS and SEIS funding.
