We are here to offer our support as required and outline here the government initiatives to help businesses through this difficult time.
We are adhering to government guidance on social distancing and working from home as far as possible. You can still phone the office number but it may be diverted to a mobile. The directors are likely to go into the office two or three times a week and therefore, should you wish to deliver records you should phone first and arrange this for one of the days when someone is in, call when you arrive and they will collect the records from the door. Correspondence will now be primarily by e-mail but please let us know if/when hard copy information is needed.
We are able to offer guidance and assistance on the various measures the government has put in place to help businesses. Full details are available from the gov.uk site under Financial support for businesses during coronavirus but the measures most likely to be of assistance to our clients are as follows:
1. Grants to businesses with premises
If your business is subject to business rates, even if you pay no rates due to small business rates relief, you should be eligible for a grant of £10,000 and you can apply for this now through your local authority. For example enter Barrow Borough Council coronavirus grants and this will take you to a page where you can apply now for a grant – you will need your business rates number and a scan of your recent bank statement.
The government have also announced that additional funds will be given to councils to assist businesses in the hospitality sector that pay council tax rather than rates – for example bed and breakfast establishments.
2. Coronavirus self-employment income support scheme
Google the above title and you will be directed to details for the support given for businesses affected by coronavirus or click on the following links:
It is available for people whose income was mostly from self-employment. It will be administered by HMRC and will give relief for three months based on average self-employed profits over the last three years. HMRC have said they will contact the people eligible, however you might find it useful to keep an eye open for when the scheme is up and running, as we will be doing.
3. Coronavirus business interruption loan scheme
This is administered through your existing bank and is available now. It can be a loan or increased overdraft facility. It is underwritten 80% by the government so reduces the risk for the lender. You should either call the bank or look for coronavirus business loans on the bank’s website. The banks may though require the last two years accounts and management accounts to date if there are more than 6 months from the year end and a cash flow forecast for the 12 months ahead. We can assist you on this.
3.b Bounce Bank Loan scheme announced
The Government has launched new Bounce Back Loans (4 May) aimed at small and medium-sized businesses affected by coronavirus (COVID-19) to access loans of up to £50,000 and which are much easier to access and generally better than the Coronavirus Business Interruption Loan Scheme.
• The government guarantees 100% of the loan and there won’t be any fees or interest to pay for the first 12 months.
• Loan terms will be up to 6 years. No repayments will be due during the first 12 months. The government will work with lenders to agree a low rate of interest for the remaining period of the loan.
• Apply for the loans from your bank
4. Coronavirus job retention scheme (Furlough)
If you have employees and they are unable to work due to the disruption of your business you can put them onto furlough leave. The minimum such period is three weeks. You should send them a letter confirming they have been put on furlough which they should acknowledge. The employer will then be able to claim 80% of their usual earnings including NI and standard pension. You may decide to reduce the salary to this 80% level or could choose to pay them their full wage and bear some of the cost yourself.
The government have advised that contractors working through personal service companies may use this scheme to claim 80% of their salary costs but nothing for their dividend income.
The first claims under this scheme have been open since the week commencing 20th April.
5. VAT payment deferral and self-assessment 2nd payment on account
These are simple reliefs and are automatic. On VAT you can opt to defer your payment due in the 23 March to 23 June 2020 period and it then becomes due by 31 March 2021. If, though, you normally pay by direct debit please remember to cancel this instruction as HMRC have confirmed they will collect the payment otherwise.
All self-employment taxpayers can choose not to pay their 2nd payment on account for 2019/20 due by 31 July 2020. No interest is charged and it becomes due by 31 January 2021. Do, please, note that this only applies if you are self-employed.
6. Mortgage deferral
The government has reached an arrangement with lenders that all customers can request a three month deferral on their mortgage payments. This should be a straightforward application on your lender’s website.
As advised the detailed guidance is on the government website and this is just a brief resume of the main reliefs we believe will help our clients. Please feel free to contact us for further guidance and assistance.