The Coronavirus – Small Business & Self-Employed Support Guide

covid

The coronavirus has had a devastating impact on peoples lives & livelihoods. With the governments plans to deal with the pandemic by the closure of all but essential business & businesses being ran remotely there has also is also now a huge financial burden.

Whether you are a business, an employee or self-employed we are all having to adapt to the situation, to aid the financial anxiety of many the government have introduced several schemes to ‘tide over’ those effected.

So if you are self-isolating due to your health, been instructed to stay away from work, working from home or you work has simply dried up here are the support schemes the government has made available to you.

Small Businesses

The government announced a new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, launched on 23rd March 2020  to support primarily small and medium-sized businesses to access bank lending and overdrafts.

The scheme is for businesses with viable borrowing proposals, up to £5 million in value, that the COVID-19 outbreak has ‘interrupted’. Businesses can access the first 12 months of that finance interest-free, as the government will cover the first 12 months of interest payments. Businesses are eligible for the scheme if they:

  • are UK based, with a turnover of no more than £45 million per year
  • meet the other British Business Bank eligibility criteria.

How do I get this support?

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website:  https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

The scheme will be available from 23rd March 2020.

More time to pay Corporation Tax

As of 25 March 2020, if your business is registered with Companies House, you can apply for a three-month extension to the deadline for filing your accounts. Businesses granted this extension won’t get the usual late payment penalty.

How do I get this support?

You need to apply for the extension using the fast-tracked application system. It takes 15 minutes, and any business giving Covid-19 (coronavirus) as the reason will get an automatic and immediate extension, according to the government website.

Business relief for tax year 2020-21

The government is temporarily cutting business rates to 0 for all retail, leisure and hospitality businesses, in response to the Covid-19 outbreak. This reduction applies in England for tax year 2020-21 for properties below £51,000 rateable value.

How do I get this support?

You don’t need to do anything to get this support – it’ll be applied to your April 2020 Council Tax bill. Your local authority may need to reissue your bill to remove the business rate charge. They’ll do this automatically, as soon as possible.

To benefit from this support, your business property needs to be completely or mainly used:

  • as a shop, restaurant, cafe, drinking establishment, cinema or live music venue
  • for assembly or leisure
  • as a hotel, guest and boarding premises or self-catering accommodation

You can use the government’s business rates calculator to find out the amount you’ll no longer have to pay this year.

Employers

Job Retention Scheme

Under the Coronavirus Job Retention Scheme, all UK employers with a PAYE scheme that was created and started on or before 28 February 2020, will be able to access support to continue paying part of their employees’ salary for those that would otherwise have been laid off during this crisis. This applies to employees who have been asked to stop working, but who are being kept on the pay roll, otherwise described as ‘furloughed workers’. HMRC will pay employers a grant worth 80% of an employee’s usual wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage.

This is to safeguard workers from being made redundant. The Coronavirus Job Retention Scheme will cover the cost of wages backdated to March 1st if applicable and is initially open for 3 months, but will be extended if necessary.

All UK-wide employers with a PAYE scheme that was created and started on or before 28 February 2020 will be eligible including:

  • Businesses,
  • Charities,
  • Recruitment Agencies (agency workers paid through PAYE),
  • Public Authorities

The employer must have a UK bank account.

How do I get this support?

You will need to:

  1. Designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.
  2. Once the new online portal is live, submit information to HMRC about the employees that have been furloughed and their earnings.

The government are aiming to have the scheme ‘live’ asap and the first repayments to employers by the end of April.

Statuatory Sick Pay Relief

Businesses will be able to reclaim the money spent on statutory sick pay (SSP) for employees in light of the coronavirus pandemic.

The government announced during last week’s Budget that they will fund SSP for two weeks for businesses with fewer than 250 employees.

Employers must pay SSP of £94.25/week to anyone too ill to work for up to 28 weeks. This is set to increase to £95.85/week on 6 April. It is paid in the same way as normal wages.

How do I get this support?

You are eligible for the scheme if:

  • your business is UK based
  • your business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020

A rebate scheme is being developed. Further details will be provided in due course

Self-Employed

Income Support Scheme

The Chancellor’s Self-Employed Income Support Scheme pays you 80 per cent of your average profits over the last three years, or up to £2,500 a month. You’ll need to take in trading profits of no more than £50,000, and make the majority of your income from self-employment, to be eligible for the taxable grant.

For example if your taxable profits for the last 3 years (2016/17, 2017/18 & 2018/19) are £23,000, £24,000 & £25,000 respectively your total profits would be £72,000 & the average monthly profits would be approximately £2,000 and you would be able to claim 80% (£1,600).

How do I get this support?

You’ll need to have complete a tax return for tax year 2018/19. If you haven’t yet filed yours, you’ll be able to do so in four weeks’ time, the Chancellor said.

HMRC will contact you directly if you’re eligible. You’ll need to fill in a simple form and the money will be paid directly into your bank account.

The support payment system is due to be ready no later than the beginning of June. If you’re struggling now, the Coronavirus Business Interruption Loan Scheme (see more details above) will be made available to most, according to the government.

Income Tax Defered

It was also announced that If you’re self-employed, any outstanding tax due to HMRC by the end of July 2020 will now not be due until January 2021.

How do I get this support?

You don’t need to do anything – the Income Tax deferral will be applied automatically to all UK businesses. You’ll have until the end of the 2020-21 tax year to pay any Income Tax liability you accumulate.

Universal Credit

The Universal Credit Minimum Income Floor will be temporarily relaxed to help support self-employed individuals who cannot claim statutory sick pay. You’ll be able to claim Universal Credit and get advance payments upfront with no requirement to go to a Jobcentre if you’re advised to self-isolate.

How do I get this support?

The government website has details on eligibility and how to claim Universal Credit.

Employment and Support Allowance

If you’re eligible, and ill or self-isolating due to coronavirus, you’ll be able to claim Employment and Support Allowance (ESA) of £73.10 a week, from day one of your sickness rather than the usual day eight. You need to be over 25 to receive ESA.

How do I get this support?

The government website has details on eligibility and how to claim ESA.

VAT

VAT payments are also being deferred for three months, from 20 March 2020 until 30 June 2020.

How do I get this support?

The deferred VAT payment deadline will be applied automatically. If you’re due a VAT refund during this period, the government will pay it as usual.

We will be keeping this guide updated should any further information become available, also make sure to follow us on twitter & if you need some advice or would like to use our services please get in contact.

 

 

 

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: