Business Measures to help cope with COVID 19 impacts
- Gary Worsdell
- Mar 26, 2020
- 4 min read
The chancellor has set out the following measures to support businesses in this period of disruption that is currently being caused by the COVID 19 outbreak. Below we have summarised the key measures that we believe could be of assistance and aid to you and your businesses.
Should you be interested in any if the measures below In Financials Limited would be happy to assist and help any way we can in these troubled times. We are only a phone call or email away, so please get in touch. We are open as normal during this time and can assist remotely.
Job Retention Scheme
If you must ask your employees to stop work due to a downturn in trade resulting from COVID 19, this scheme will give you support in retaining and paying staff during this period.
The scheme will apply to workers that you have asked to stop working due to the crisis, HMRC term this as “Furlonged”. In these circumstances HMRC will reimburse the business 80% of their wages, up to £2,500 per month. The primary aim of this is to safeguard staff from redundancies that would otherwise take place.
To qualify for the scheme, you must be a UK employer with a registered PAYE scheme.
The scheme will cover wages from 1st March for three months and can be backdated, the three month period will be extended by government if they feel it is required.
How to access the scheme
· You must designate the affected employees as “Furlonged workers” and notify the employee of this change in status. They are not allowed to work during this period.
· Submit the claim to HMRC about furlonged employees and costs on a new online portal (this has not yet been set up, but HMRC are urgently working on this)
VAT payment deferral
You may defer payment of your VAT to HMRC due in the period 20 March 2020 to 30 June 2020 i.e. VAT quarters ended 29th February 2020, 31st March 2020 and 30th April 2020.
This deferral is open to all UK VAT registered businesses.
The taxpayer will have until 5th April 2021 to settle the VAT deferred.
How to access the scheme
· This is an automatic offer, so no application is required.
· The advice is that if you currently pay your VAT to HMRC by direct debt then to cancel this with your bank, as if not it will still be collected.
· You should still ensure your VAT return is still filed on or before the due date.
· You will also need to make arrangements to pay future VAT liabilities on time. I.e. set up the direct debit again or make bank transfers. This deferral currently only applies to VAT liabilities payable in the given period.
Self-Assessment
Any self-assessment payments on accounts that were due for payment on 31 July 2020, may be deferred to 31 January 2021.
The deferment is an optional one and HMRC stress that if you able to make the payment on 31st July 2020 you should still do so.
How to access the scheme
· This is an automatic offer with no application required.
· No interest or late filing penalties will be payable, as long as paid before 31St January 2021
· Need to be able off the full liability due on 31st January 2021
Sick pay support
If you have employees off sick due to COVID 19, HMRC will cover up to 2 weeks SSP per employee.
How to access the scheme
· Must be a UK based small or medium sized business (fewer than 250 employees as of 28th February 2020).
· You should maintain a record of the staff absences. No need for a GP fit note. If evidence is required the employee can obtain an isolation note from NHS111 online (NHS covid-19), or if they are off due to living with someone with symptoms of COVID 19 they can get a note from the NHS website (NHS self isolation advice)
· The exact details of how the rebate will be claimed is currently being developed. So at present you just need to ensure you are keeping the required data for the claim, as noted above.
Business Interruption loan
The is a temporary loan scheme to support small and medium sized enterprises (SME’s) during these difficult times.
The loans are still taken with the banks, but the government will provide a guarantee of 80% of the loan value for a maximum period of six years.
The government will also support by way of a business interruption payment to cover the interest cost of the loan in the first 12 months and any lender fees levied.
How to access the scheme
· You must be a UK based business with less than £45m turnover.
· Your business meets the other British business bank criteria British business bank - Criteria
· All major banks are able to offer the scheme. British business bank - lenders
· You should speak the bank asap and present your business plan.
· If you have an existing loan you may also wish to discuss a repayment holiday with your bank to help with cashflow.
Corporate Financing
Due to the expected cashflow impact on businesses as a result of the COVID 19 Crisis, the Bank of England will buy short term debt from larger companies.
How to access the scheme
· All non-financial companies that meet the criteria are eligible. More information can be found at the Bank of England’s site Bank of England
Commercial tenant protection
Commercial tenants who are unable to meet rent payments due to COVID 19 in the period up to 30 June (could be extended by Government if needed) will not automatically forfeit their lease and be forced to leave the premises.
Note: this should not be treated as a repayment holiday.
How to access the scheme
· This will form part the Coronavirus bill and as yet no details are published on how this will work in practice.
The above are just some of the measures that the government has put in place and more are likely to follow, including further assistance for the self-employed. The following links are to useful resources and latest developments on this issue.
The information and government support is fast moving in these times of crisis and as such the above details may change and be superseded very fast. Therefore, In Financials Limited cannot be held liable for any actions taken based on the above without consultation of In Financials Limited before taking any action.
Comments