Coronavirus Newletter

The Government have put together a website (https://www.businesssupport.gov.uk/coronavirus-business-support/) to help businesses find out how to access the support, who is eligible, when the schemes open and how to apply. I have summarised the information below which may be relevant to your business.

I update my Twitter feed as and when I find new information. You can find me at @RichardBownCo.


Self-Employed Help

The government will pay self-employed people, who have been adversely affected by the coronavirus, a taxable grant worth 80% of their average monthly profits over the last 3 years, up to £2,500 per month. You’ll be able to claim these grants and continue to do business.

It’s only open to those with trading profits up to £50,000, who make a majority of their income from self-employment. Only those already in self-employment, who have a tax return for 2019 can apply.

The government expect people to access it no later than the beginning of June, and this maybe back dated to March. If eligible, HMRC will contact you with an online form, then pay the grant straight to your bank account. So three months until you can receive this help, but you can access the business interruption loans.

The chancellor has said, "there is nothing we can do" for newly self-employed who haven't completed a 2019 Tax Return.



Business Interruption Loan

The temporary Coronavirus Business Interruption Loan Scheme supports small and medium-sized businesses with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to six years.

The Government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.

The scheme will be delivered through commercial lenders, backed by the Government-owned British Business Bank.

There are 40 accredited lenders able to offer the scheme, including all the major banks.

You should apply via your lender’s website or through one of the 40 accredited finance providers offering the scheme (and not the British Business Bank).

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website.

You are eligible for the scheme if your business is UK based, with turnover of no more than £45 million per year and your business meets the other British Business Bank eligibility criteria.

The scheme is now open for applications. All major banks are offering this scheme.


Time to Pay

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’ve missed, or are worried about missing, your next tax payment due to coronavirus, please contact HMRC. You can also call the HMRC helpline for advice on 0800 0159 559.


Income Tax Deferral for the Self-Employed

If you are self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.


VAT Deferral

VAT payments can be deferred for 3 months. The deferral will apply from 20 March 2020 until 30 June 2020.

This is an automatic offer with no applications required. UK Registered businesses will not need to make VAT payments normally due with VAT returns during this period. Taxpayers will be given until the end of the 2020-21 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.


Coronavirus Job Retention Scheme

Under the coronavirus Job Retention Scheme, all UK employers with a PAYE scheme will be able to access support to continue paying part of their employees’ salary for those that would otherwise have been laid off during this crisis. This applies to employees who have been asked to stop working, but who are being kept on the pay roll, otherwise described as ‘furloughed workers’. HMRC will reimburse 80% of their wages, up to £2,500 per month. This is to safeguard workers from being made redundant. The Coronavirus Job Retention Scheme will cover the cost of wages backdated to March 1st and is initially open for 3 months, but will be extended if necessary.

You will need to:

1. 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.

2. Once the new online portal is live, submit information to HMRC about the employees that have been furloughed and their earnings (HMRC will set out further details on the information required).


Business Rates Holiday for Retail, Hospitality and Leisure

Businesses in the retail, hospitality and leisure sectors in England will not have to pay business rates for the 2020-21 tax year. Businesses that received the retail discount in the 2019-20 tax year will be rebilled by their local authority as soon as possible.


Cash Grant for Retail, Hospitality and Leisure

If your business is in the retail, hospitality or leisure sector, you will receive a cash grant of up to £25,000 per property. Businesses in these sectors with a rateable value of under £15,000 will receive a grant of £10,000. Businesses with a rateable value of between £15,001 and £51,000 will receive a grant of £25,000.


Small Business Grant Funding

There is support for small businesses that already pay little or no business rates because of small business rate relief (SBRR). This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs. You can now apply for this grant online at your local authority.

North Tyneside

Newcastle Upon Tyne


Interest-Free Business Loans


If you’re facing cash flow issues, there are loans available for small or medium-sized businesses, with no interest to pay for 12 months.

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/accredited-lenders/


IR35 Reforms


Reforms to IR35 have been delayed by 12 months as part of the government’s Covid19's economic response package.

https://www.gov.uk/government/news/off-payroll-working-rules-reforms-postponed-until-2021



If you’re 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 stay at home, you can now make a claim for Universal Credit or new style Employment and Support Allowance.
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 stay at home.


Mortgage Holiday

The Government also announced that for those in difficulty due to coronavirus, mortgage lenders will offer at least a three month mortgage holiday. You will need to apply directly to your mortgage lender. Check with them first, if this will have an adverse effect on your credit rating.