Covid-19 update for businesses and employees

Covid-19 update for businesses and employees

Friday evening saw Prime Minister Boris Johnson and Chancellor Rishi Sunak announce new measures and provide further detail on the support the Government is offering during the Coronavirus outbreak to both businesses and their employees.

The Chancellor’s statement can be found at GOV.UK.

Updated guidance for employers, businesses and employees is available at:

In summary measures include;

  • “Coronavirus job retention scheme” available to all UK employers to pay up to 80% of all notified “furloughed” workers pay up to a cap of £2,500 per month. An online portal is being set up to access this funding. This scheme will run for at least 3 months from 1 March 2020, but will be extended as necessary.
  • A temporary business interruption loan scheme delivered by the British Business Bank will be available early next week with the Government providing the banks with 80% guarantee on loans of up to £5m to provide much needed cashflow finance to SME’s . To meet borrowing criteria businesses must be UK based with turnover up to £45m.
    • Talk to your finance provider and discuss your business  plan with them either for additional funds or a payment holiday on existing loans. If you need help with preparing the plan and approaching your bank please contact your Partner at Barlow Andrews.
  • The Government will also buy short term debt from (ie monies owed to) larger companies to assist with working capital requirements of the business. All UK businesses are eligible for this, there are however a number of lending restrictions, and may be accessed for up to 12 months via Bank of England. Details will be available from Monday on Bank of England’s website and the funding will be similar to that available through invoice discounters .
  • VAT – VAT payments are to be deferred for 3 months up to 30 June. No application is necessary and taxpayers will be given until 5 April 2021 to catch up with this period’s liability. Vat refunds will be repaid as normal.
  • Time to pay – UK cash stressed businesses will be eligible for support through “Time To pay service” to receive support with outstanding tax liabilities. This will be agreed on a case by case business. If you need help with approaching HMRC please contact your usual Partner. Furthermore those already in time to pay agreements may also be entitled to repayment holidays.
  • If you are self employed your tax payment due in July 2020 is deferred until, and will be added to your payment due in, January 2021. Again no application is required.
  • Statutory sick pay (SSP) – The Government will refund SSP on eligible employees off with coronavirus for a period of up to 2 weeks. The Government are in the process of setting the scheme up.
  • Business rates holiday has been announced until the end of the 2020/2021 tax year for all businesses in the retail, hospitality and leisure sectors. This will be applied to your next council tax bill in April 2020.
  • Retail, hospitality and leisure businesses based in England are also eligible for cash grants of up to £25,000 per property. Your local authority will write to you shortly if you are eligible for this grant.
    • A grant of £10,000 is also to be provided to small businesses who pay little or not rates under small business rate relief, rural rate relief and tapered relief.
  • Insurance – Those businesses in the leisure sector with pandemic and Government ordered closure cover will be able to claim on their policies.

If you have queries on any of the above or require assistance/guidance on how to go about gaining access to the various funds and schemes mentioned please do contact us on 01204 527451.