The Coronavirus is the biggest threat this country has faced in decades – and this country is not alone. All over the world we are seeing the devastating impact of this invisible killer. Which is why the Government is working to a scientifically-led, step-by-step action plan – taking the right measures at the right time.
During this difficult time for the country, we recognise the extreme disruption the necessary actions are having on people’s lives, their businesses, their jobs and the nation’s economy. And that’s why we have produced a huge and unprecedented programme of support both for workers and for business, and we’ll do everything we can to ensure people can pay their bills, stay in their home and put food on their table.
The Chancellor has set out a package of temporary, timely and targeted measures to protect small businesses through these difficult times as part of the national effort in response to coronavirus, including:
- a Coronavirus Job Retention Scheme
- deferring VAT and Income Tax payments
- a Statutory Sick Pay relief package for small and medium sized businesses (SMEs)
- a 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
- small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
- grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
- the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank, with no interest for 12 months. The Chancellor has extended the scheme (3 April 2020) so that all small businesses affected by Coronavirus, and not just those unable to secure regular commercial financing, will now be eligible. The Government is also banning lenders from requesting personal guarantees for loans under £250,000.
The Government has also announced measures to help people with the cost of living during this unprecedented time. Self-employed people can benefit from a three-month mortgage holiday, deferring the next three months of VAT tax, deferring income tax self-assessment payments due in July 2020, alongside further measures to protect renters and to help people with their energy bills.
As you can appreciate, this is a fast-moving situation. I would strongly advise you to check the Government website, at gov.uk/coronavirus, for the very latest guidance and support.
At this moment of national emergency – it is vital that we all stay at home, protect our NHS and save lives.
Additional background information:
- Stepping in and helping pay people’s wages – a scheme which is one of the most generous of any in the world – paying grants to support as many jobs as necessary. Any employer in the country – large, small, charitable or for profit – who promises to retain their staff, can apply for a grant to cover most of the cost of paying people’s wages. Government grants will cover 80 per cent of the salary of retained workers up to a total of £2,500 a month – above the median income. We will place no limit on these grants. The cost of wages will be backdated to 1st March and will be open initially for at least three months – and we will extend the scheme for longer if necessary.
- Deferring the next three months of VAT tax, a direct injection of over £30 billion of cash to employers, equivalent to 1.5 per cent of GDP. That means no business will pay any VAT from now until the end of June, and they will have until the end of the financial year to repay those bills.
- Supporting small and medium-sized businesses to cope with the extra costs of paying Statutory Sick Pay (SSP) by refunding eligible SSP costs. The criteria for eligible businesses are:
o The refund will be limited to two weeks per employee who has claimed SSP as a result of Covid19.
o Employers with fewer than 250 employees will be eligible.
o Employers should keep records but should not require employees to provide a doctor’s note.
o The eligible period will commence from the day on which regulations extending SSP come into force.
o We will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible.
- Helping all businesses in the retail, hospitality and leisure sectors – meaning that none of these companies will have to pay business rates. All businesses in this sector are exempt from business rates for 12 months – that’s every single shop, pub, theatre, music venue, restaurant, and any other business in the retail, hospitality or leisure sectors. In addition, we will provide small businesses in these sectors with an additional grant scheme of up to £25,000. Any business with a rateable value of less than £51,000 can now get access to a government grant
- Providing grants to the smallest of businesses of £10,000. We are providing £10,000 grants to the 700,000 of our smallest businesses.
- We have introduced a Coronavirus Interruption Loan Scheme to provide loans of up to £5 million, interest free for 12 months, to small businesses. More than £90 million of loans to nearly 1,000 small and medium sized firms have been approved under the scheme since it was launched last week. But we are going further. The Chancellor has extended the scheme (3 April 2020) so that all small businesses affected by Coronavirus, and not just those unable to secure regular commercial financing, will now be eligible. The Government is also banning lenders from requesting personal guarantees for loans under £250,000.
- Businesses and self-employed people may be eligible to receive support with their tax affairs through HMRC’s Time to Pay service. Arrangements are agreed case-by-case. Businesses can contact HMRC’s new dedicated COVID-19 helpline for advice.
- Standing behind businesses small and large – providing a £330 billion package of loans and guarantees – that’s worth 15 per cent of our GDP. And if demand is greater than the initial £330 billion we are making available, we will go further and provide as much capacity as required. That means any good business in financial difficulty who needs access to cash to pay their rent, the salaries of their employees, pay suppliers, or purchase stock, will be able to access a government-backed loan, on attractive terms.
o We will support liquidity amongst large companies, with a major new scheme being launched by the Bank of England.
o We will support lending to small and medium-sized businesses by extending the Business Interruption Loan Scheme announced in the Budget. This means that, rather than providing loans of £1.2 million, it will provide loans of up to £5 million, with no interest for the first twelve months.
o Both of these schemes will be up and running by the start of next week – and the Chancellor is also taking a new legal power in the Covid Bill to offer whatever further financial support is necessary.
Accessing Government support:
If you are a small- or medium-sized business, you may be entitled to reclaim the costs of Statutory Sick Pay (SSP) for sickness absence due to COVID-19:
- This refund will cover up to two weeks’ SSP per eligible employee who are either ill or been told to selfisolate because of COVID-19. This is in line with the recommended isolation period. Guidance on selfisolation can be found here: www.nhs.uk/conditions/coronavirus-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 began on 13 March.
- 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.
Some businesses, including nurseries, in England will be eligible for a Business Rates holiday for 1 year from 1 April 2020:
- If you are currently receiving the retail discount for your Business Rates bill, you will receive a revised bill with 100% relief shortly.
- If your business occupies a property in the retail sector with a rateable value of £51,000 or more, or if your business occupies a property in the leisure or hospitality sectors you may also be eligible for the 100% discount on your business rates bill.
- You will shortly hear from your Local Authority. If you have any questions, you should contact your Local Authority.
- If you are a nursery, you will be entitled to the 100% relief for the next year. You should contact your Local Authority for more information.
- Guidance for Local Authorities will be published by MHCLG by 20 March.
If your business is eligible for small business rate relief or rural rate relief in England, you are entitled to a one-off cash grant of £10,000:
- If your business is in the retail, hospitality or leisure sector in England, then you may also be entitled to a cash grant. If you have a property with a rateable value of less than £15,000 then you will be entitled to a grant of £10,000, whether or not you are entitled to small business rate relief or rural rate relief. If you have a property with a rateable value of between £14,999 and £51,000 then you will be entitled to a cash grant of £25,000.
- The Department for Business, Energy and Industrial Strategy (BEIS) will provide guidance for Local Authorities on how to administer these grants shortly.
- If you are an eligible business, your Local Authority will then be in touch in the coming weeks to provide details of how to claim this money.
If your small-or medium-sized business in England is facing cash flow issues as a result of COVID-19, please read the following information:
- A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch at the start of next week to support businesses to access bank lending and overdrafts.
- The government will provide lenders with a partial guarantee of 80% on each loan 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 first 12 months of these loans will be interest-free, as the Government will cover these payments.
- Businesses will be able to get finance under the scheme from a large number of providers, including the main high street banks, as of next week.
- Businesses will remain responsible for repaying any facility they take out.
- For further information, please visit: https://www.british-business-bank.co.uk/ourpartners/coronavirusbusiness….
If you own a pub that serves food or a restaurant in England, you will be able to operate a hot food takeaway to serve people staying at home, without going through the usual planning process:
- The Ministry for Housing, Communities and Local Government (MHCLG) will shortly legislate to bring forward a temporary Permitted Development Right to allow for change of use from A3 (Restaurant) and A4 (Pub) to A5 (Hot Food Takeaway).
- The intention is that once the legislation has come into force a pub or restaurant will be able to notify their Local Authority that they are now operating as a takeaway without any prior approval.
If you contract your services to large- or medium-sized organisations outside of the public sector you should read the following information:
- The government announced on 17 March that the reform to the off-payroll working rules (commonly known as IR35) - that would have applied for people contracting their services to large or medium-sized organisations outside the public sector - will be delayed for one year from 6 April 2020 until 6 April 2021.
- Business and individuals do not need to take any action.