We are currently in very uncertain times... the most uncertain in most of our lifetimes.
This comes from both a personal and business perspective, with new announcements
and measures being announced daily in order to combat the impact of Covid-19 and in
order to keep as many of us healthy and safe, as possible.
For most of us, there is great uncertainly with regards to our employment or our
businesses - how will we get paid if we're not able to work? How will we pay the bills?
Covid-19 support announced in the budget
As you may have seen in the budget last week and in the announcements yesterday, the Chancellor, Rishi Sunak has put together a support package to help businesses and individuals through this difficult time. Last week, he announced a £30 billion stimulus package to support the economy through coronavirus and pledged to give the NHS whatever extra resources are needed to cope.
Particular support for businesses and individuals included the following:
Statutory Sick Pay (SSP)
Following the news that the Bank of England had reduced interest rates to 0.25%, in an emergency response to the coronavirus, Mr Sunak put further measures in place. These include Statutory Sick Pay (SSP) for employees who are advised to self-isolate from day 1 (previously day 4), even if they are displaying no symptoms, this will temporarily extend SSP to cover:
The government will support small and medium-sized businesses and employers to cope with the extra costs of paying COVID-19 related SSP by refunding eligible SSP costs. The eligibility criteria for the scheme include:
In addition, business rates for shops, cinemas, restaurants and music venues in England with a rateable value below £51,000 were announced to be suspended for a year. This tax holiday will be worth up to £25,000 to thousands of businesses across the retail, leisure and hospitality sectors.
The government previously committed to introducing a £1,000 business rates discount for pubs with a rateable value below £100,000 in England for one year from 1 April 2020. To further support pubs, in response to COVID-19 the discount for pubs was increased to £5,000.
Self employed and those not eligible for SSP
Self-employed people and employees earning below the National Insurance Lower Earnings Limit are not entitled to SSP and therefore, the Chancellor confirmed he would offer financial support to these individuals through a ‘new style’ Employment and Support Allowance and Universal Credit.
The Employment Allowance provides businesses and charities with relief from their employer NICs bill. Regulations have been issued to restrict the Employment Allowance, from 6 April 2020, to those employers whose employer NICs bill was below £100,000 in the previous tax year. Employers who are connected to other employers (such as companies within a group) will need to add together all of their employer Class 1 NICs liabilities incurred in the tax year prior to the year of claim to determine eligibility.
The maximum Employment Allowance will be increased from £3,000 to £4,000 with effect from 6 April 2020.
Time to Pay
The government will ensure that businesses and self-employed individuals in financial distress and with outstanding tax liabilities receive support with their tax affairs.
HMRC has set up a dedicated COVID-19 helpline to help those in need, and they may be able to agree a bespoke Time to Pay arrangement. Time to Pay gives businesses a time-limited deferral period on HMRC liabilities owed and a pre-agreed time period to pay these back.
The helpline can assist with:
The number of the helpline is 0800 0159 559. Opening hours are Monday to Friday 8am to 8pm, and Saturday 8am to 4pm.
Yesterday, the Chancellor's announcement increased the support for businesses beyond the budget with an additional £330bn package, which included the following….
Business Interruption Loan Scheme
A new Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will enable businesses to apply for a loan of up to £5 million, with the government covering up to 80% of any losses with no fees. Businesses can access the first 6 months of that finance interest free, as the government will cover the first 6 months of interest payments.
I do not know yet, how this will be accessed, but will update you as soon as I know, as this may be needed by some businesses.
Grants for smaller businesses
There will be a £10,000 cash grant to the smallest businesses, delivered by local authorities. Small businesses that pay little or no business rates and are eligible for small business rate relief (SBBR) or rural rate relief will be contacted by their local authority - they do not need to apply. The funding will be provided to local authorities in early April. Guidance for local authorities on the scheme will be provided shortly.
Additional business rates relief
The government is introducing a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
A £25,000 grant will also be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.
Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday will be published by 20 March.
The Chancellor, also confirmed that if more was needed, he would go further…..
Links to government websites for further guidance and support:
Dated: 18th March 2020
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