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. Please see up to date details here.
The package includes:
Coronavirus Job Retention Scheme/Furlough Scheme
- To try and avoid mass redundancies the government has pledged to cover up to 80% of workers’ wages up to £2,500 a month (backdated to 1st March 2020) for all UK businesses. Employers will need to designate affected employees as furloughed workers and notify those employees of this change. Information about those furloughed will need to be submitted through a new online portal. To find out if your business is eligible and how to access the scheme please click here
- Find out if you’re eligible and how much you can claim to cover wages for employees on temporary leave (“furlough”) due to Coronavirus (COVID-19) here
- We also found this article from the FT useful: What employers need to know about Sunak’s workers rescue plan
- You should look at the latest treasury guidance (click here) and consider whether the recent developments around employees having to use holiday during furlough are helpful
- UPDATE: it was announced on 12th May 2020 that the furlough scheme will be extended to the end of October 2020 with new flexibility being introduced from August to get employees back to work (see more details here) – this will likely also see a reduction in the 80% being reimbursed by the government. If this means you’ll need to make redundancies, make sure you’ve considered your other legal obligations (particularly if any redundancies means you’ll have made 20 or more dismissals since March)
Deferring VAT and Income Tax payments
- These will apply from 20 March 2020 until 30 June 2020, and no application is required. Businesses will not need to make a VAT payment during this period. Businesses 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. For more info click here
Statutory Sick Pay Relief Packages for SMEs
- This includes up to 2 weeks of SSP for employers with less than 250 employees. For more info click here
12-Month Business Rates Holiday for all retail, hospitality and leisure businesses in England. For more info click here
Small Business Grant Funding of £10,000 for all business in receipt of small business rate relief or rural rate relief. For more info click here
Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
- The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website
- For more info click here
HMRC Time To Pay Scheme
- This is operated on a case by case basis and you should contact HMRC to apply for this. For more info click here
Convertible Loans/The Future Fund
- The Government has announced a new scheme to issue Convertible Loans of £125k to £5m to innovative companies which are facing financing difficulties due to the Coronavirus outbreak: the Future Fund (from May 2020). More detailed guidance is available on the British Business Bank website.
- Eligibility includes (1) must be UK company (2) must get match-funding from private investors (3) must have previously raised equity investment of at least £500k in last 5 years
- The £500 million Future Fund has been designed to ensure high-growth companies across the UK receive the investment they need to continue during the crisis (click here for more detail).
- Click here for the application form
On 20th May the government introduced the Corporate Insolvency and Governance Bill in Parliament, putting in place a series of measures to amend insolvency and company law to support business and to address the challenges resulting from the impact of Coronavirus.
The Bill consists of 6 insolvency measures and 2 corporate governance measures. These changes hope to give businesses some breathing space especially those facing cash flow issues. Find out how the bill can help your business here. More information is available also here: https://www.gov.uk/government/news/changes-to-insolvency-legislation-enacted
Companies House has announced they will be supporting businesses affected by the Coronavirus outbreak by temporarily pausing the strike off process to prevent companies being dissolved. This will give businesses the time they need to update their records and help them avoid being struck off the register. In addition, companies issued with a late filing penalty due to COVID-19 will have appeals treated sympathetically. You can see full details here.
Please click here for more details on how you can access government financial support if you or your business has been affected by COVID-19.