Friday March 20 2020

Financial support available to businesses impacted by COVID-19

Financial support available to businesses impacted by COVID-19

Details are emerging of the financial support the Government is making available to businesses impacted by COVID-19. These initially were announced in the Budget on 11 March 2020, with further announcements announced on 17 March 2020.

Below is an update of some of the key measures intended to help businesses compiled by chartered accountants and business advisors, Alexander & Co:

Coronavirus Business Interruption Loan Scheme (CBILS)

The British Business Bank will be delivering a Coronavirus Business Interruption Loan Scheme. Businesses with a turnover of up to £41m will be able to apply for up to a £5 million loan. This will have no fees and additionally, 80% of any losses will be covered by the Government. Finance in the first 6 months will be interest free, these initial interest payments being met by the Government.

This Loan Scheme will temporarily replace the British Business Bank’s Enterprise Finance Guarantee (EFG) scheme with an additional £1bn being made available on top of existing support offered through the programme. It will operate in a similar way to EFG, albeit on more attractive terms, both for lenders and businesses.

The new scheme is available in the coming, with further information on how to apply and eligibility to be announced.

HMRC Time to Pay Arrangements and HMRC Helpline

HMRC has set up a phone helpline to support businesses and self-employed people concerned about not being able to pay their tax due to COVID-19. 

Time to Pay arrangements (which allows spreading tax payments over a longer period of time than usual) for businesses and self-employed individuals in financial distress and with outstanding tax liabilities is available on a case-by-case basis.

The dedicated HMRC COVID-19 telephone helpline is 0800 0159 559.

Filing of company accounts

For any businesses impacted by COVID-19 requiring more time to file company accounts, this may be allowed on a case-by-case basis. Importantly, Companies House will need to be contacted before the filing date. Automatic penalties will still be imposed If an extension is not applied for in advance and your accounts were filed late.

Postponement of IR35 (Off-payroll working Rules) for the private sector

The proposed private sector IR35 reforms (off-payroll working rules) have been delayed by 12 months until 6 April 2021, these were previously due to come into effect in just a matter of weeks.

Additional Business Rates Relief

Additional Business rates relief was recently announced in the budget, and this is now being increased further. All retail, hospitality and leisure businesses in England are understood to be eligible to receive a 100% business rates holiday for the next 12 months. Nurseries will also be entitled to the 100% relief for the next year.

Guidance is due to be published on this by the Ministry of Housing, Communities and Local Government on 20 March 2020.

Changes to Statutory Sick Pay (SSP)

If you staff are self-isolating because of COVID-19, from 13 March, they can claim SSP. This includes individuals caring for people self-isolating in the same household and therefore have been advised to do a household quarantine.

The government is legislating for SSP to be paid from day 1, rather than day 4, if a person is absent from work due to sickness or need to self-isolate caused by COVID-19. Once legislated, this will apply retrospectively from 13 March.

Additionally, the cost of providing 14 days of statutory sick pay per employee will be refunded by the Government in full for businesses with less than 250 employees.

Further assistance for the retail, hospitality and leisure industry

£25,000 grants will be available to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000.

The Government has given confirmation that their advice to avoid pubs, clubs and theatres etc. is adequate for these to claim on their insurance where they have the appropriate business interruption cover for pandemics.

Planning regulations will be relaxed to allow pubs and restaurants to begin providing takeaways without a planning application.

Additional measures

The Government has also outlined the following measures:

Unlimited loans and guarantees to support businesses in managing their cashflows will be provided. Initially £330 billion of guarantees will be made available.

Support for liquidity amongst large businesses, with the Bank of England launching a new scheme to help these businesses to bridge COVID-19 disruption to their cash flows through loans.

A £10,000 cash grant (increased from the £3,000 cash grant announced in the Budget) will be available to 700,000 of the smallest businesses. This is to be delivered by Local Authorities and will apply to businesses currently eligible for Small Business Rates Relief (SBRR) or Rural Rate Relief.

In addition to the above measures, new legal powers will be introduced to allow the Government to offer whatever further financial support it believes necessary to businesses as the situation evolves.

The above information has been provided by Alexander & Co Chartered Accountants. Further information is available at www.alexander.co.uk

Alexander & Co can be contacted on 0161 832 4841 or email: info@alexander.co.uk


"HMRC has set up a phone helpline to support businesses and self-employed people concerned about not being able to pay their tax due to COVID-19. This is 0800 0159 559"
Alexander Co


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