With COVID-19 developing uncertainties and businesses concerned about the current and future impact of the behaviour changes across the UK, businesses of all sizes need to consider the potential impact on their activities and finances and plan accordingly.

On Thursday 17th, Rishi Sunak as Chancellor announced a package of support for businesses ranging from supporting SMEs with payroll costs to the creation of temporary loan schemes. Below is a summary of the main support packages announced to date:

Government-backed funding

Loans

A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch on Monday 23rd to support businesses to access bank lending and overdrafts. As things stand we are awaiting further guidance which is expected to be available on Friday 20th.

The information we know is that the government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value. The loans will not have arrangement fees or charge interest for a period of 6 months (this has been extended to 12 months in the announcement on 20 March https://www.nrbarton.co.uk/news/blog/coronavirus-covid-19-chancellor-outlines-employment-subsidy-measures/).

As soon as the guidance is released we will issue a further communication. It is our intention to be able to assist clients with applications for these loans.

See link for guidance of how the loan scheme will operate: https://www.nrbarton.co.uk/news/blog/coronavirus-covid-19-business-interruption-loan-scheme-guidance/

Small business grant of £25k for businesses in the leisure, tourism, and hospitality sectors

The government are to provide support for local authorities to award grants to small businesses in the leisure, tourism and hospitality sectors. This will provide a one-off grant of £25,000 to businesses in those sectors with rateable values between £15,000 and £51,000, to help meet their ongoing business costs.

Whilst we are awaiting further guidance this process is expected to be by application to local authorities. Further guidance will be released on Friday.

We expect to be are able to assist clients with these claims and we will issue further details on this as soon as the guidance is released.

Small business grant of £10,000

The government are providing funding for local authorities to support small businesses that currently pay little or no Business Rates because of Small Business Rate Relief (SBBR). This will provide a one-off grant of £10,000 to businesses currently eligible for SBRR or Rural Rate Relief, to help meet their ongoing business costs.

We are currently awaiting further guidance on the details of the mechanism for these refunds though Government have stressed these refunds should be expected by early April. Once we know we will let you know.

Help with tax liabilities

All businesses and self-employed people with concerns regarding meeting their tax obligations as they fall due, and those with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.

There is no global statement from HMRC regarding such Time To Pay arrangements as they are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

To ensure ongoing support, HMRC has made a further 2,000 experienced call handlers available to support firms and individuals when needed. HMRC have set up a dedicated helpline for Time to Pay support if you are concerned about being able to pay your tax due to COVID-19, they can be contacted on 0800 0159 559.

Government level support

Payroll costs

The government will bring forward legislation to allow small and medium-sized businesses (SMEs) and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The eligibility criteria for the scheme will be as follows:

  • This refund will cover up to two weeks’ SSP per eligible employee who has been off work because of COVID-19.
  • Employers with fewer than 250 employees will be eligible. The size of an employer will be determined by the number of people they employed as of 28 February 2020.
  • Employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19.
  • Employers should maintain records of staff absences, but employees will not need to provide a GP fit note.
  • The eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to self-isolators comes into force.
  • The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible. Existing systems are not designed to facilitate employer refunds for SSP.

Supporting our clients

NR Barton are able to provide support and guidance to help review your concerns and possibilities in the current climate including advice on accessing support and assist with identifying options for cash flow needs.

For further information or advice please get in touch with your contact Partner at the firm.