Each day more enquiries come in from clients who are understandably concerned about the implications of coronavirus for their businesses.
COVID-19 is a huge source of alarm to people across the country, with all but the essential services unable to operate as the nation is locked down.
Projections of how bad it could get suggest the situation will get worse before it gets better.
To cope, the Government has announced a raft of emergency measures to try and keep the 5.9 million UK businesses and the economy afloat.
Unsurprisingly, these state-sponsored schemes are what our clients are most keen to learn about, and especially how to access them.
Coronavirus job retention scheme
The job retention scheme is initially open for three months and aims to support employers whose operations have been affected by COVID-19.
It offers employers the opportunity to furlough employees for at least three weeks, starting from 1 March 2020.
Employers can claim for 80% of furloughed employees’ usual monthly wage costs, up to £2,500 a month, from the Government.
Directors qualify for this scheme if they were on their own company’s payroll on 28 February 2020 or earlier. They can only claim, or furlough, themselves if they have actually stopped working.
The online service used to claim is not yet available, although HMRC expects it to be up and running by the end of April.
Income support for the self-employed
In most cases, self-employed income support offers a taxable grant worth 80% of your trading profits.
It is based on trading profits of less than £50,000 in 2018/19, or average trading profits of less than £50,000 between 2016 and 2019.
Sole traders or partners who meet that criteria can claim up to £2,500 a month for three months. HMRC will pay the grant as a lump sum directly into your bank account.
As the scheme is based on tax returns, HMRC already has the information it needs to determine if you are eligible. The tax body will contact you directly and invite you to submit a claim through GOV.UK
Grants for small businesses
Businesses that qualified for small business rate relief or rural rate relief in 2019/20 may be eligible for a £10,000 grant.
As this is tied in with business rates, your local authority will contact you this month if you are eligible.
Retail, hospitality and leisure firms that operate smaller premises and have a rateable value of between £15,000 and £51,000 can receive a small business grant of up to £25,000.
Funding should be provided from your local authority this month.
Business interruption loans
SMEs that are losing revenue or experiencing cashflow disruption due to the coronavirus may be able to claim a business interruption loan of up to £5m.
The British Business Bank has a list of more than 40 lenders to provide term loans, overdrafts, asset finance or invoice finance.
No interest is due on whichever form of finance you secure for the first year.
To qualify, your firm must be UK-based with annual turnover of up to £45m, it must operate in an eligible industrial sector and have a sound borrowing proposal.
Deferred payment options
Those of you who are self-employed and affected by the coronavirus can defer your next income tax payment.
The second payment on account deadline relating to 2019/20 was due to be on 31 July 2020, as is usually the case.
You have another six months to pay your 2019/20 tax bill, which is due in full no later than midnight on 31 January 2021.
For owners of VAT-registered businesses, you can stop your next payment at your bank to ease pressure on cashflow.
This specifically relates to quarterly or monthly payments which are normally due between 20 March and 30 June.
The deferred payment will need to be paid in full, however, by 31 March 2021.
Deferred reporting obligations
For directors of limited companies, you can apply to Companies House to get a three-month extension to file your accounts.
Applications can be made online and take around 15 minutes. Those who cite coronavirus-related disruption will automatically get the extension.
Hopefully this blog sheds some light on what support you may qualify for and how to approach it. If in any doubt, contact us on info@stapletonsaccountants.co.uk or call 01363 773191.
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