If you are considering letting staff go, please read the following information:
- For the first time in history, the UK government is going to step in and help pay people’s wages – paying grants to support as many jobs as necessary.
- Grants will be paid to any employers who retain their staff. Any employer in the country – large, small, charitable or for profit – who promises to retain their staff, will be able to apply for a grant from HMRC to cover most of the wages of people who are not working but are kept on payroll, rather than being laid off.
- Grants will cover 80 per cent of the salary of retained workers up to a total of £2,500 a month – which is above the average income. The cost of wages will be backdated to 1 March and will be open initially for at least three months – and the UK Government will extend the scheme for longer if necessary.
- There will be no limit on the number or total value of grants paid out.
- HMRC are working day and night to get the scheme up and running, and we expect the first grants to be paid within weeks.
Your business will not pay VAT until the end of June:
- The UK Government have announced that VAT for April, May and June will be deferred, and businesses will have until the end of the financial year to repay those bills.
Your business may be entitled to reclaim the costs of Statutory Sick Pay (SSP) for sickness absence:
- This refund will cover up to two weeks’ SSP per eligible employee who are either ill or been told to self-isolate because of COVID-19. This is in line with the recommended isolation period. Guidance on self-isolation can be found here: 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 UK 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.
- The eligible period for the scheme began on 13 March.
Your business may be eligible for rates relief and grants:
- If your business occupies a property in the retail, hospitality or tourism sectors you will be eligible for a 100 per cent discount on your rates bill for 1 year from 1 April 2020. This will be regardless of the rateable value of the property. The property must be occupied in order to be eligible.
- You may be eligible for a grant of up to £25,000 if your business is in the hospitality, leisure and retail sector and occupies a property with a rateable value of between £18,000 and £51,000.
- You may be eligible for a grant of up to £10,000 if your business is eligible for the Small Business Bonus Scheme or Rural Rate Relief.
- Your business will be eligible for a 1.6 per cent relief regardless of rateable value. This measure effectively freezes the poundage rate for the coming year. This will not need to be applied for – it will automatically be applied to your bill.
- You will be eligible for these reliefs even if you are already in receipt of another form of relief.
- The Scottish Government have said they are working urgently with Scotland’s Dumfries and Galloway Council to ensure these reliefs are administered in the most effective way. More information on how to apply is available at: https://www.mygov.scot/non-domestic-rates-coronavirus/.
- Further information for businesses in Scotland is available at https://findbusinesssupport.gov.scot/coronavirus-advice
If you own a small or medium-sized business that is facing cash flow issues, you should read the following information:
The new Coronavirus Business Interruption Loan Scheme (CBILS), delivered by the British Business Bank, is now operational and is ready to support businesses to access bank lending and overdrafts.
- The scheme is working to provide funding for business through term loans, overdrafts, asset finance and invoice finance.
- The UK Government is providing lenders with a guarantee of 80 per cent on each loan to give them greater confidence in providing loans to small and medium sized businesses.
- If you obtain a loan as part of this scheme, you will not be charged for this guarantee and nor will your lender.
- You will be able to apply for loans worth up to £5 million, from over 40 lenders, interest free for the first twelve months as the UK Government will be covering the cost of the repayments.
- You will be able to access lending as part of this scheme from a large number of lenders, including the high street banks. The British Business Bank is working with over 40 lenders to support British business in this time of crisis.
- While the British Business Bank has set up CBILS you should approach your lender via their website in the first instance to see if you are eligible for funding, before looking at other lenders.
- The latest information is available at https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/for-businesses-and-advisors/
- You can confirm whether or not you are eligible by reading this check list: https://www.british-business-bank.co.uk/wp-content/uploads/2020/03/CBILS-SME-Eligibility-Check-FINAL.pdf
If you own a large business that is facing cash flow issues, you should read the following information:
- Companies commonly sell short term debt, known as ‘commercial paper’, to the market. This is a quick and cost-effective way to raise working capital.
- The UK Government is working with the Bank of England to set up a new Corporate Financing Facility, that will allow the Bank to buy short term debt from companies.
- This will support companies which are fundamentally strong, but have been affected by a short-term funding squeeze, enabling them to continue financing their short-term liabilities. It will also support corporate finance markets overall and ease the supply of credit to all firms.
- Further information is available from the Bank of England here: https://www.gov.uk/government/publications/launch-of-covid-19-corporate-financing-facility-ccff
- The UK Government have said that they will announce further measures in the coming weeks to ensure that large businesses access credit.
If you are a business owner, or are self-employed and you are concerned about your tax bill, you may be eligible for support through HMRC’s Time to Pay service:
- HMRC may agree, on a case by case basis, to assist with your business’ tax bill through the Time to Pay Service.
- These arrangements are tailor made and based on individual circumstances and liabilities.
- More information can be found here: https://www.gov.uk/government/news/tax-helpline-to-support-businesses-affected-by-coronavirus-covid-19.
If you own a restaurant or a pub that serves food, you may be able to operate a hot food takeaway without the usual planning process:
- The Scottish Chief Planner has made clear that planning authorities should not restrict pubs or restaurants operating a takeaway service temporarily.
- These measures will be reviewed in three months.
- More information is available here: https://www.gov.scot/publications/corona-virus-covid-19---relaxation-of-enforcement-where-public-houses-and-restaurants-offer-a-takeaway-service-during-the-current-outbreak-chief-planner-letter-march-2020/
If you contract your services to large or medium sized organisations outside of the public sector, you should read the following information:
- The UK Government announced on 17 March that the reform to the off-payroll working rules, 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.
- You, as a business or an individual, do not need to take any action.
If you are concerned about the impact of the deposit return scheme or tourist tax on your business, you should read the following information:
- The go-live date for the deposit return scheme has been delayed until July 2022 to ensure that businesses are not burdened with this policy during a time of crisis.
- The legislation to introduce the Transient Visitor Levy (‘tourist tax’) has been halted.
If you are concerned about whether your business can make a claim on business interruption insurance, you should read the following information:
- The UK and Scottish Government’s medical advice of 16 March is sufficient to enable those businesses which have an insurance policy that covers both pandemics and government ordered closure to make a claim – provided all other terms and conditions in their policy are met. Businesses should check the terms and conditions of their specific policy carefully and contact their providers if in doubt.
- However, most businesses have not purchased insurance that covers pandemic related losses. This means they cannot claim regardless of whether government orders businesses to close. As such they should make use of the government support available to them.
If you are a third sector organisation under financial pressure, please read the following information:
- The Scottish Government have pledged a £50 million ‘Welfare Fund’ to support their third sector partners, as well as other organisations, who will require additional capacity to deal with challenges as a result of COVID-19. This fund will be targeted at organisations who specifically assist those who are already vulnerable, for example people experiencing homelessness, fuel poverty or difficult living circumstances.
- The Scottish Government have also pledged a £20 million ‘Third Sector Resilience Fund’ to help organisations with cash flow.
- We are awaiting details on how these funds will be accessible to charities.