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Government Support Guide

The chancellor has set out a package of temporary, timely and targeted measures to support public services, people and business through this period of disruption caused by COVID-19.

This includes a package of measures to support business including:

  • A coronavirus job retention scheme
  • Deferring VAT and income tax payments
  • A statutory sick pay relief package for SMEs
  • A 12-month business rates holiday for all retail, hospitality, leisure and nursery business 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 relatable 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
  • A new lending facility from the Bank of England to help support the liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
  • The HMRC Time To Pay Scheme
  • A Coronavirus Job Retention Scheme

To find out what support is available for you and your business, please visit https://www.gov.uk/business-coronavirus-support-finder.

Eligibility

All UK businesses are eligible.

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary that would otherwise have been laid off during the crisis.

How to access the scheme

You will need to:

  • Designate affected employees as ‘furloughed workers’, and notify your employees of this change - changing status of employees remain subject to existing employment law and, depending on the employment contract, may be subject to negotiation
  • Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set to to facilities payments to employers.

In the Government’s Job retention Scheme, all UK employers, irrespective of size, will be able to access support to continue paying part of their employees’ salary for those that would otherwise be dismissed during this coronavirus pandemic.

Employers will need to:

  • Designate affected employees as ‘furloughed workers’, and notify employees of this change
  • What does “furloughed” mean? The definition of “furlough” is to allow or force someone to be absent temporarily from work
  • The guidance states that “changing the status of employees remains subject to existing employment law and, depends on the employment contract”. Therefore, employers will be required to consult with employee’s before designating employees as “furloughed workers”. This will entail advising employees that in view of the temporary cessation of work they will no longer be required to attend work. It is important to advise them that they are not being dismissed but will remain on the payroll.
  • Employers should then submit information to HMRC about the employees that have been furloughed and their earnings through a new HMRC online portal.

HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per worker per month. This will be backdated to 1st March and will be initially open for three months and may be extended as necessary. HMRC is currently working to set up a system for reimbursement

  • Deferring VAT and Income Tax payments

Support for businesses through deferring VAT and Income Tax payments

We will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payment due in July 2020 under the self-assessment system will be deferred to January 2021.

VAT

For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.

Eligibility

All UK businesses are eligible.

Support for businesses who are paying sick pay to employees

We will bring forward legislation to allow small-and-medium-sized businesses 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 2 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 February2020
  • 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 and payments of SSP, but employees will not need to provide GP fir note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS Website
  • Eligible period of the scheme will commence the day after the regulations on the extension of SSP to those staying at home 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.

SSP payment support eligibility

Eligibility

You are eligible for the scheme if:

  • Your business is UK based
  • Your business is a small or medium sized and employs fewer than 250 employees as of 28 February 2020

How to access the scheme

A rebate scheme is being developed. Further details will be provided in due course once the legalisation has passed.

Support for businesses through the Coronavirus Business Interruption Loan Scheme

A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to support primarily small and medium sized business to access bank lending and overdrafts.

The government will provide lender with a guarantee of 80% on each loan (subject to a pre-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.

Eligibility

You are eligible for the scheme if:

  • Your business is UK based, with turnover of no more than £45 million per year
  • Your business meets the other British Business bank eligibility criteria

Support for businesses that pay little or no business rates

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

Eligibility

You are eligible if:

  • Your business is based in England
  • You are a small business and already receive SBBR and/or RRR
  • You are a business that occupies property

How to access the scheme

You do not need to do anything; your local authority will write to you if you are eligible for this grant.

Guidance for local authorities on the scheme will be provided shortly/

Any enquiries on eligibility for, or provision of the reliefs and grants should be directed to the relevant local authority

Find your local authority

Support the larger firms through the COVID-19 Corporate Financing Facility

Under the new COVID-19 corporate financing facility, the Bank of England will buy short term debt from larger companies.

This will support your company if it has been affected by a short-term funding squeeze and allow you to finance your short-term liabilities.

It will also support corporate finance markers overall and ease the supply of credit to all firms.

Eligibility

All UK businesses are eligible

How to access the scheme

The scheme will be available early in week beginning 23 March2020.

We will provide information on how to access the scheme here shortly

More information is available from Bank of England

Support for businesses paying tax: Time to Pay service

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time to Pay Service

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities

Eligibility

You are eligible if your business:

  • Pays tax to the UK government
  • Has outstanding tax liabilities

How to access the scheme

If you have missed a taxpayment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.

If you’re worried about a future payment, please call us nearer the time.

Key Features of the Scheme

Finance of up to £5 million Guarantee to the lender to encourage them to lend Government pays interest and fees for 12 months

The maximum value of a facility provided under the scheme is £5 million, available on repayment term of up to six years.

The scheme provides the lender with a government-backed, partial guarantee against the outstanding balance of the finance.

The borrower remains 100% liable for the debt.

The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied charges.

Finance terms Security No guarantee fees for businesses

For term loans and asset finance facilities; up to six years.

Insufficient security is no longer a condition to access the scheme.

For all facilities, including those over £250,000, CBILS can now support lending to smaller businesses even when a lender considers there to be sufficient security, making more smaller businesses eligible to receive the Business Interruption Payment.

There are no guarantee fees for SMEs. Lenders pay a fee to access the scheme.

For overdrafts and invoice finance facilities; up to three years.

No personal guarantees for facilities under £250,000.

Personal guarantees may still be required, at a lender's discretion, for facilities above £250,000, but they exclude the Principal Private Residence (PPR) and recoveries under these are capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied.

Find Out More

CBILS for SMEs - how smaller businesses can apply for the scheme

CBILS: current accredited lenders - lists of lenders already providing finance through CBILS

CBILS for accredited lenders - information for lenders on how to provide finance through CBILS

Become a CBILS accredited lender - details of accreditation for prospective lenders

Coronavirus Business Interruption Loan Scheme (CBILS) – For SMEs and Advisors

https://www.gov.uk/business-coronavirus-support-finder