The rapidly changing nature of the COVID-19 outbreak means that information and advice from Government can change quickly. For the latest Government information on COVID-19, please visit the UK Government website, the Scottish Government website, the Welsh Government website or the Northern Irish Government website. Please be sure to check the COVID-19: guidance for employers and businesses from the Government for the latest updates.

 
 

Scottish Enterprise Coronavirus Helpline

0300 303 0660

Invest Northern Ireland phone number is

 0800 181 4422

Business Wales Helpline is

0300 060 3000

The UK Government’s Department for Business, Energy and Industrial Strategy

0300 456 3565

HMRC’s dedicated tax helpline on

0800 0159 559

What you need to know – support available and guidance from government (updated 27th March)

The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19. He has also just announced support for self-employed.

This includes a package of measures to support businesses including:

  • direct cash grant of 80% of their profits, up to £2,500 per month for self employed
  • a Coronavirus Job Retention Scheme
  • a Statutory Sick Pay relief package for small and medium sized businesses (SMEs)
  • deferring VAT and Income Tax payment
  • a 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
  • small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
  • 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
  • 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

Visit the new government website  to access information on all support available.

80% cash grant of profits

Support package for self-employed

  • The government will pay the self-employed a taxable grant worth 80% of their average monthly profits over the last three years up to £2500 per month
  • This will be available for three months. Will be extended if necessary
  • People can claim these grants and continue to do business
  • Covers self-employed same as those furlong

To ensure the funds reaches the people most in need:

  • Open to anyone of trading profits of up to £50,000
  • Available to people who i) make the majority of their income being self-employed, ii) Have a self-employed tax return for 2019

How to access

  • HMRC will contact you directly and you’ll have to fill out a form
  • HMRC will pay the grant directly to bank accounts.
  • Aim is to pay at the beginning of June (3 months backdated). Hoping to be quicker than that but recognition HMRC are now having to design two new systems
  • Anyone who missed the Jan filing deadline has an extra 4 weeks from today to submit their tax return

Further Details can be found at – https://www.gov.uk/government/news/chancellor-gives-support-to-millions-of-self-employed-individuals

The government has just announced a support package for self-employed.

 
 

Deferring VAT and Income Tax Payment

The government will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.

VAT

For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.

Eligibility

All UK businesses are eligible.

How to access the scheme

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 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.

Customers who normally pay by direct debit should cancel their direct debit with their bank if they are unable to pay. Please do so in sufficient time so that HMRC do not attempt to automatically collect on receipt of your VAT return.

Income Tax

For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.

Eligibility

If you are self-employed you are eligible.

HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities.

The government will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.

 
 

12 month Business Rates Holiday

The government will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.

Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.

  • months)
  • Deferring the next quarter of VAT through to the end of June (those payments can now be paid at the end of the financial year)
  • Universal Credit – standard allowance to rise over the next 12 months by £1,000

Business Rates and Cash Grants

In England

  • Expanding the 100% business rates holiday for the next 12 months to cover all retail, hospitality and leisure businesses in England – not just those up to £51k Rateable Value.

In Scotland

  • 12 months 100% relief rates holiday for businesses in hospitality, leisure and retail. Grants will also available for Scottish companies in this sector
  • All non-domestic properties will get 1.6% relief, reversing the poundage change.
  • You can find additional detail on the Scottish Government’s package of reliefs and grants at https://www.mygov.scot/non-domestic-rates-coronavirus/

In Northern Ireland

  • 3 month rates holiday for all businesses, which effectively means a further 25% discount off your bill
  • The issuing of rates bills will be deferred from April until June

In Wales

How to access the scheme

There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator on the www.gov.uk website

Further guidance for local authorities is available in the expanded retail discount guidance of the government website

The government will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.

 
 

Grant Funding

Cash grants for retail, hospitality and leisure businesses

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

In England

  • Providing a £25,000 cash grant to retail, hospitality and leisure businesses in smaller premises, with a Rateable Value below £51k.
  • Increasing the proposed £3,000 cash grant to 700,000 small businesses (those eligible for Small Business Rate Relief) to a £10,000 cash grant. We think this will also apply for those eligible for rural rates relief.

In Scotland

  • Providing a £25,000 grant for businesses in hospitality, leisure and retail with a rateable value between £18,000 and £51,000.
  • Small firms receiving the small business bonus or rural relief will be eligible for a £10,000 grant. Businesses will be also be able to request to defer all payment.
  • All non-domestic properties will get 1.6% relief, reversing the poundage change.
  • You can find additional detail on the Scottish Government’s package of reliefs and grants at https://www.mygov.scot/non-domestic-rates-coronavirus/

In Northern Ireland

  • Providing a £25,000 grant to companies in the hospitality, tourism and retail sectors with a rateable value from £15,000 to £51,000.

In Wales

  • £25,000 grant for retail, leisure and hospitality businesses with a rateable value of between £12,001 and £51,000
  • Small firms eligible for Small Business Rates relief with a rateable value of £12,000 or less will receive a £10,000 grant.
  • You can find additional details on the Business Wales website – https://businesswales.gov.wales/coronavirus-advice

This document provides guidance to authorities about the operation and delivery of the policy: Expanded Retail Discount 2020/21: Coronavirus Response – Local Authority Guidance

The government will provide additional Small Business Grant Scheme funding for local authorities 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.

Small Business Grant Scheme

Additional Small Business Grant Scheme funding for local authorities 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 has been made available. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

Eligible businesses are those based in England already receiving SBBR and/or RRR occupying property (including those with a Rateable Value between £12,000 and £15,000 which receive tapered relief).

You do not need to do anything to claim this grant, your local authority will contact you if you are eligible for this grant. Any queries should be addressed to your local authority. However, I have read quite a bit that says actually it probably is best to follow this up with your local council and be proactive.

Cash grants for retail, hospitality and leisure businesses and small business grant funding

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property. Additional Small Business Grant Scheme funding for local authorities 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 has been made available.

 
 

Business Interruption Loan Scheme

The temporary Coronavirus Business Interruption Loan Scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 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 government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. 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.

Eligibility

You are eligible for the scheme if:

 

The temporary Coronavirus Business Interruption Loan Scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.

 
 

Universal Credit

On 20 March 20 the Chancellor announced the suspension of the minimum income floor for the self-employed and that the standard allowance was to rise over the next 12 months by £1,000. This means that self-employed people can now access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay for employees.

You can find out more about Universal Credit and apply on line at – https://www.gov.uk/universal-credit

 

On 20 March 20 the Chancellor announced the suspension of the minimum income floor for the self-employed and that the standard allowance was to rise over the next 12 months by £1,000. This means that self-employed people can now access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay for employees.

 
 

Finance Options

In addition to considering new overdraft facilities, banks and finance providers should also be lenient on things like loan repayments. We hope also that they will agree to mortgage holidays for commercial as well as residential premises. You’ll have seen the Bank of England cut interest rates from 0.75% to 0.25%.

 
 

Cashflow and Lending

  • Supporting liquidity amongst large firms, so they can pay their small suppliers, salaries and rents
  • Supporting SMEs via banks to underwrite loans of up to £5m (formerly this was up to £1.2m); and with the first 6 months of that finance interest free (i.e. that the Government will pay for)
  • The Development Bank of Wales has loan and equity funding available immediately to Welsh businesses. The Welsh Government is working closely with the Development Bank of Wales to consider additional support to help businesses through the Covid-19 impact.
  • Confirming with lenders to provide mortgage payment holidays of at least 3 months for those facing finance issues as a result of coronavirus (there was later confirmation of future help for those that rent; but that remains unclear)

Timing-wise, the Government promises this will be available from Monday 23 March 2020

 
 

Employment Allowance Help

Small employers with a National Insurance bill of £100,000 or less will continue to qualify for the Employment Allowance.

This will be expanded from April to £4,000 per small business, enough, for example, to fund the National Insurance employer contributions in total for four employees on the National Living Wage.

 
 

Insurance

Think about how your business insurance will work if your business closes due to an outbreak of the virus. 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.

Firstly, you need to check your policy, or confer with your broker to see if you have Business Interruption cover in your commercial insurance policy. Business Interruption insurance covers the income that you lose after a disaster, and often comes up when discussing terrorism cover (for example, after the London Bridge attack, local businesses that were forced to close for a period of time would have been able to claim for revenue lost under this clause).

Once you have confirmed that you have Business Interruption cover, you will need to check whether you have an extension for “notifiable diseases”. If you have this in your policy wording, you will need to reach out to your broker/insurer to confirm whether coronavirus is covered. The UK Government has declared COVID-19 a notifiable disease. Holyrood has declared coronavirus a notifiable disease in Scotland.

If you are part of the SightCare Insurance scheme, the broker does note that Insurers have stated they are still reviewing the policy wordings as this type of unprecedented event isn’t generally covered under policies. The core Business Interruption cover provided by policies inherently responds to physical property damage at the insured premises resulting in the business being unable to trade. Cover for Pandemics or Government ordered national shut downs do not themselves trigger cover under policies available. However the broker believes there is an argument for potential cover under the following:

 Page 49.

11. Prevention of access – non damage

your financial losses and other items specified in the schedule, resulting solely and directly from

an interruption to your business caused by an incident within a one mile radius of your

premises which results in a denial of access or hindrance in access to your premises during the

period of insurance, imposed by any civil or statutory authority or by order of the government or

any public authority, for more than 24 hours.

If you would like David to pursue a claim, he has asked that SightCare members formerly send him an email to david.morgan@besso.co.uk with the following noted in the subject line:

Name of Insured and Besso ‘BT’ reference.

Within the body of the email please provide:

  • Has the Business closed?
  • When did the Business close?
  • If Closed, why has the business closed, Employee has the Coronavirus so business has had to close for a deep clean / insured is sole trader and has Coronavirus so cannot trade/ so much loss of foot fall insured does not see why they should stay open / Government instructions
  • Is the business due to re-open.
  • Any idea of percentage of loss, if due to footfall.

Think about how your business insurance will work if your business closes due to an outbreak of the virus. 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. More Information on SightCare Insurance Policy

 
 

Other Measures

Hardship Funds

£500m has been allocated for local authorities to help vulnerable people, we hope to make sure this includes help for the self-employed in distress, as well as small firms.

This is likely to be the focus of help for local businesses, but no details are yet available.

Rent Holiday

We hope that landlords will take a generous approach to their small business tenants, many of whom have already seen trading and footfall dip. This is particularly important in areas of high rent, such as high streets or urban centres (including London).

Jobcentre Plus and Benefits for Self-Employed

The Government has suspended the ‘minimum income floor’ from Universal Credit (UC) for the self-employed, so if you are in the system due to low income there is no longer an assumption you earn the equivalent of the living wage (which from next month this is £8.72 an hour, so for 35 hours a week that’s £305.20). UC is administered through Jobcentre Plus, which like the NHS is likely to switch to online/phone for consultations.

If you do not currently receive Universal Credit you can apply to do so. If you need income fast, you can apply for an advance on your first scheduled universal credit payment. You can apply for universal credit even if you are working – it is designed for people who are either out of work or on a low income. This includes someone who is self-employed and whose income has dropped as a result of this disruption.

If you are self-employed and claiming Employment Support Allowance (ESA), and test positive for coronavirus or are in self-isolation, you will be able to claim from day one of a claim instead of waiting the usual seven days. You will also be able to apply for ESA if you have a disability or health condition that affects how much you can work.

Hardship funds, rent holidays and Jobcentre Plus.