COVID-19: An overview of the main Government support schemes.

Have you struggled to keep up with the news overload over the past few weeks? We know we have been inundated with questions about the support the Government is offering and how it affects you.

Here our experts provide a summary of the main Government aid available for businesses during COVID-19 to cover some of the most common queries on what help you and your business can expect and when we think it will be available.

OVERVIEW OF SUPPORT

There has been a combination of options made available for those requiring support including:

Business Relief: There will be a £10k grant made available for all business in receipt of Small Business Rate Relief or Rural Rates Relief. A grant of up to £25,000 and a 12-month business rates holiday will be available to businesses trading from premises with a rateable value of under £51,000 in the retail, hospitality and leisure sectors. Nurseries and estate/letting agents have also been added to the group eligible for a rates holiday for the tax year 2020/21. Local authorities will be automatically issuing these grants in due course and the relief will automatically be applied on your council tax bill in April 2020. FIND OUT MORE

Coronavirus Business Interruptions Loan Scheme: This scheme offers loans of up to £5m for SME’s through the British Business Bank. There is no interest for the first 12 months and 80% of the funding is backed by the Government. Applications need to be made through one of the lenders that are making this available, but you should be able to apply through the bank’s website. FIND OUT MORE.

Coronavirus Job Retention Scheme (CJRS): Any employer that has suffered a decrease in trade, can furlough employees for a minimum 3-week period. During this time the employee will not be able to undertake any work but will remain on the payroll. The employer can apply for a grant from the government via a portal, once the system goes live. The grant will reimburse the employer for80% of the employee’s gross salary (capped at£2,500 per month), plus the associated employer’s NI and pension costs  We expect the portal to go live by the end of April, so employers will still need to fund the short term employment costs.

The scheme runs from 1 March to 31 May 2020 initially but may be extended. Employees who were on the payroll at 28 February 2020 are eligible, even if they were laid off before the scheme was introduced.

The position for individuals operating though their own personal limited company remains confused. Directors are eligible in principle for the job retention scheme, but it is difficult to see how a sole director in a limited company could actually be furloughed. If they are still actively seeking work or doing any aspects of the current work, as opposed to statutory duties. Clarification on this point is urgently required by HMG. If the director can be furloughed, the amount to be claimed back would be 80% of the salary paid through the PAYE system, and this does not include dividends. FIND OUT MORE

Self-Employed Income Support Scheme: The self-employed, whose average earnings are up to £50k per year, will be able to apply for a ‘loss of earnings’ grant. The reimbursement will be 80% of the trading profits averaged over the last 3 years or since commencement if more recent. Under the proposals, the scheme excludes anyone who has started up since 5 April 2019, as these profits are disregarded. It is anticipated that the portal will be available in June and a one-off payment of 80% of 3 months’ profits will be received in a lump sum in June. FIND OUT MORE

Deferral of Taxes: The Government has said that most taxes can be deferred for a minimum of 3 months. This will be granted automatically, but you will still need to cancel your Direct Debit for your VAT payment if you want to take advantage of this. For self-assessment, 31 July 2020 payments can be deferred to 31 January 2021. FIND OUT MORE.

HMRC Time to Pay Scheme: If you owe money to HMRC and are in financial distress you might be eligible for support, such as increasing the timeframe available to pay. FIND OUT MORE

Statutory Sick Pay (SSP): This scheme allows employers to reclaim up to two weeks’ SSP they pay for sickness due to COVID-19. Your business must have had fewer than 250 employees on 28 February 2020 to be eligible for this reimbursement. FIND OUT MORE

Insurance: If you have cover for pandemics or government closure, your insurer should cover your business. The government and the insurance industry have confirmed that the advice to avoid pub, theatres, etc. is sufficient to make a claim. FIND OUT MORE

USEFUL LINKS

Here are some useful links to finding out answers to your questions about Government support for businesses during the coronavirus crisis.

Official guidance: ‘COVID-19: support for businesses’

Business support FAQs

If you are still unable to answer your question, please speak to your normal Wright Vigar contact or call the new Government helpline on 0300 456 3565.

DOWNLOAD OUR USEFUL MIND MAP TO SEE WHAT SUPPORT YOU MIGHT BE ELIGIBLE FOR

CHECK OUT OUR INFOGRAPHIC SUMMARISING THE GOVERNMENT SUPPORT