Coronavirus: Support for Businesses

Last updated 19 May 2020. 

 

At this time it is vital that every business knows the support available to it. That's why the Government has launched a tool that allows businesses to see the tailored support available for their circumstances which can be found at https://www.gov.uk/business-coronavirus-support-finder.

I would encourage all businesses across Burnley and Padiham to complete this and if there are any questions, or issues, please get in touch with me. 

 

As we manage our way through this period, the government has been clear that our overriding priority is to protect lives. But we also need to protect the economy, shielding it from this crisis as best we can and ensuring that once we get through this, we can grow once again. That’s why the government has announced such a significant package of financial support. It is on a scale never seen before.

This page sets out the support being offered by government to impacted businesses as at the date shown above. This includes measures announced at the Budget on 11th March 2020 and subsequent announcements. 

The package includes the following measures, which are set out in more detail below:

  • A Coronavirus Job Retention Scheme
  • Deferring VAT and Income Tax payments
  • A Statutory Sick Pay relief package for SMEs
  • A 12-month business rates holiday for all retail, hospitality and leisure businesses in England
  • A 12-month business rates holiday for nursery businesses that pay business rates
  • Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
  • Bounce Back Loan Scheme for small businesses providing up to £50,000 interest free for the first 12 months
  • 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, which are interest free for 12 months. 
  • The Coronavirus Large Business Interruption Loan Scheme, offering loans of up to £50m for large businesses with a turnover of more than £45m. 
  • 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

Coronavirus Job Retention Scheme

If you are an employer with a PAYE scheme, you should be able to access support to continue paying part of your employees’ salary instead of laying them off.

This applies to employees who have been asked to stop working because of Coronavirus, but are being kept on the payroll. They are known as ‘furloughed workers’. HMRC will pay 80% of their wages, up to £2,500 per month.

In order to access the scheme you will need to designate affected employees as "furloughed workers". ensuring you notify the individuals of this. Note that changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation. 

To check if you can claim for your employees wages, calculate how much the grant will be, and get further information please go to: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

VAT

If you’re a UK VAT registered business and have a VAT payment due between 20 March 2020 and 30 June 2020, you have the option to defer payment until 31 March 2021.

All UK businesses are eligible and no applications are required. Businesses will not need to make a VAT payment during this period. VAT refunds and reclaims will be paid by the government as normal.

Full information is available at: https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19

Self-Assessment Payments on Account

If you are due to pay a Self Assessment payment on account by 31 July 2020, you can defer payment up until January 2021. You will not be charged any interest or penalties during the deferral period.

You do not need to be self-employed to be eligible for the deferment.

The deferment is optional. If you are still able to pay your second payment on 31 July, you should do so.

This is an automatic offer. You do not need to apply for the deferral, or tell HMRC. If you normally pay by Direct Debit you should contact your bank to cancel your Direct Debit as soon as you can. You do not need to contact HMRC before doing this.

Statutory Sick Pay Relief

Employers can reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. This scheme will cover up to 2 weeks of SSP for every eligible employee.

Employers must maintain records of staff absences and payments for SSP. Employees will not have to provide a GP fit note.

You are eligible if your business meets both of the following requirements. Your business is:

  • UK based
  • small or medium-sized and employs fewer than 250 employees as of 28 February 2020

For full details, please visit: https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19.

Business Rates

Businesses in the retail, hospitality and leisure sectors in England will not have to pay business rates for the 2020 to 2021 tax year, with a 100% discount being applied.

You do not need to do anything and there is no maximum rateable value. If you are eligible, Burnley council will apply the discount automatically.

You’re eligible if your property is a:

  • shop
  • restaurant, café, bar or pub
  • cinema or live music venue
  • assembly or leisure property - for example, a sports club, a gym or a spa
  • hospitality property - for example, a hotel, a guest house or self-catering accommodation

Retail, Hospitality and Leisure Grant Fund

The Retail Hospitality Grant Scheme will provide businesses in the retail, hospitality and leisure sectors with a cash grant. The grant amount will be:

  • Businesses in these sectors with a rateable value of under £15,000: Grant of £10,000.
  • Businesses in these sectors with a rateable value of between £15,001 and £51,000: Grant of £25,000.

Businesses are eligible for this Scheme if they are in the UK and the business is in the retail, hospitality or leisure sector. This covers all shops, restaurants, cafes, pubs / bars, cinemas, live music venues, hotels, guest premises and leisure facilities.

This Scheme is administered by Burnley Council on behalf of Government locally and no action is needed. The Council will contact all eligible businesses. 

If you believe you are eligible and have not yet contacted Burnley Council to give them your payment details, please do so as soon as possible by going to https://www.burnley.gov.uk/business and clicking on "Coronavirus Business Support Grant". 

If you have completed the form and have not yet heard back, please contact me using the contact form on this website. 

For more information on the grants, please click here

Small Business Grant Funding

The Government will provide additional Small Business Grants to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

This Scheme is administered by Burnley Council on behalf of Government locally and no action is needed. The Council will contact all eligible businesses. 

If you believe you are eligible and have not yet contacted Burnley Council to give them your payment details, please do so as soon as possible by going to https://www.burnley.gov.uk/business and clicking on "Coronavirus Business Support Grant". 

If you have completed the form and have not yet heard back, please contact me using the contact form on this website. 

For more information on the grants, please click here

Support for nursery businesses that pay business rates

Nurseries in England do not have to pay business rates for the 2020 to 2021 tax year. Burnley Council will administer this automatically.

You’re eligible if your business is on Ofsted’s Early Years Register and provides care and education for children up to 5 years old (early years foundation stage).

Local authority-run nurseries are not eligible.

Bounce Back Loan Scheme

For small businesses a new micro loan, free from interest for the first 12 months, up to the value of 25 per cent of turnover, with a cap of £50,000, is now available.

These are not be subject to business liability tests or complex eligibility criteria, and are 100% backed by the Government.

You can apply for a loan if your business:

  • is based in the UK
  • was established before 1 March 2020
  • has been adversely impacted by the coronavirus

Businesses from any sector can apply, except:

  • banks, insurers and reinsurers (but not insurance brokers)
  • public-sector bodies
  • state-funded primary and secondary schools

You cannot apply if you’re already claiming under:

  • Coronavirus Business Interruption Loan Scheme (CBILS)
  • Coronavirus Large Business Interruption Loan Scheme (CLBILS)
  • COVID-19 Corporate Financing Facility

However if you’ve already received a loan of up to £50,000 under one of these schemes you can transfer it into the Bounce Back Loan scheme. You have until 4 November 2020 to arrange this with your lender.

For more information click here

Coronavirus Business Interruption Loan

If you are a small to medium-sized business (SME) you may be able to apply for a temporary loan, overdraft, invoice finance and asset finance of up to £5 million, for up to 6 years.

You may also be eligible for Business Interruption Payment to cover the first 12 months of interest payments and any lender fees. The government will give lenders 80% guarantee on each loan (subject to pre-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.

You may be eligible for this scheme if you meet all of the following criteria:

  • Your business is UK-based, with a turnover of no more than £45 million per year
  • You have a borrowing proposal which would be considered viable by the lender, if not for the current pandemic
  • You can self-certify that Coronavirus (COVID-19) has adversely impacted your business

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks offer the Scheme as do a number of smaller finance companies. 

If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

HMRC Time To Pay

All businesses 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 due to the volume of current calls. 

Coronavirus Large Business Interruption Loan Scheme

The Coronavirus Large Business Interruption Loan Scheme (CLBILS) will provide a government guarantee of 80% on each loan, to give banks further confidence in financing businesses impacted by Coronavirus.

It allows banks to make loans of:

  • Up to £25 million to businesses with an annual turnover of £45 million to £250 million
  • Up to £50 million to businesses with an annual turnover of over £250 million

You can apply for this loan if your business:

  • Is UK based
  • Has an annual turnover of at least £45 million
  • Meets the other British Business Bank eligibility requirements

The scheme will be delivered through commercial lenders, supported by the Government-backed British Business Bank. Facilities backed by a guarantee under CLBILS will be offered at commercial rates of interest.

For more information please visit: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/clbils/

Monetary Policy

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.

The facility will offer financing on terms comparable to those prevailing in markets in the period before the Covid-19 economic shock, and will be open to firms that can demonstrate they were in sound financial health prior to the shock. The facility will look through temporary impacts on firms’ balance sheets and cash flows by basing eligibility on firms’ credit ratings prior to the Covid-19 shock. Businesses do not need to have previously issued commercial paper in order to participate.

All UK businesses are eligible for this and it will become active in week commencing 23rd March 2020. 

Full details are available from the Bank of England

Insurance

Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17th March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim as long as all other terms and conditions are met. The Government also announced on Friday 20th March that all pubs, theatres etc must close. 

Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.

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