Business support and advice updates
These are unprecedented times and as well as keeping you, your family, friends and colleagues safe, we know you have many pressing questions.
As accountants and business experts we are here to support you through this difficult time. We will be providing updated information on this page as and when we get it and we will be running a webinar next week where we will focus on how to survive and plan for the future.
If there are specific matters that you wish to discuss then please just get in touch as our team is here to help in anyway they can.
COVID-19 Business updates for 28th March
Today the Business Secretary announced the relaxation of the insolvency rules, which could help businesses avoid liquidation due to coronavirus.
The wrongful trading rules were introduced into UK insolvency law in 1986 and make it an offence for a company director to continue to trade if they know the business is unable to void going into liquidation.
Wrongful trading is when the directors know their company doesn't have enough assets ie cash, stock, debtors and have no plans of how they will pay their creditors. It is unacceptable for directors to continue trading knowing they are worsening the position of their creditors and building further debt.
COVID-19 Business updates for 26th March
Self-employed Income Support Scheme
Today the Chancellor announced new, very generous support for the self-employed.
Those eligible for the scheme
- Those who earn the majority of their income from self-employment
- Had average profits of no more than £50,000 over the last three years
- Those who were self employed during 2018/19 and are still self employed during 2019/20
- If they report that their income has been negatively impacted as a result of coronavirus
If you match the above criteria then you will be eligible for a taxable grant equal to 80% of the average profits you reported across the three years, from April 2016 to April 2019, up to a limit of £2,500 per month.
If you have traded for less than 3 years, but meet all of the above criteria, then your average will be calculated on the length of time you have traded, up to 5 April 2019.
The government has chosen a policy that, for those self-employed people who can still carry on working at some level, is more generous than the Job Retention Scheme (JRS) for employees.
Self-employed people will be eligible for this scheme however small their fall in income whereas, as an employee, you cannot work at all if they want to qualify for the JRS.
As this self-employed income support scheme (SEISS) is so difficult to administer, the payment will not be made until June, but will be a lump sum covering 3 months.
This delay means that you may have to rely on borrowing or welfare benefits to cover short falls in income until the payment is made.
Monday 23rd March, 2020
'We must stay at home'
A guide to the new restrictions...
COVID-19 Business updates for 20th March
Coronavirus Job Retention Scheme
The scheme will mean any employer in the country, irrespective of size, including charitable organisations and not for profit organisations, will be eligible to apply. Employers can contact HMRC for a grant to cover 80% of wages of people who are not working but are retained on payroll, rather than being laid off. This will extend up to £2,500 pcm per employee.
The Coronavirus Job Retention Scheme will be backdated until 1st March 2020, and available for at least three months, with the Chancellor confirming that this period will be extended if required, and that unlimited funding will be made available for the scheme.
He advised that the first grants will be paid within a matter of weeks, and at the very latest before the end of April.
Coronavirus Business Interruption Scheme
The Business Interruption Loan Scheme, whereby the Government will guarantee up to 80% of the value (up to £5m) of loans introduced, will now be interest free for 12 months and will be available from Monday 23rd March.
The Chancellor advised that more measures would be announced during week commencing 23rd March to ensure that medium and larger businesses can also access this.
Deferral of VAT Payments
The Chancellor confirmed that he would be deferring the next VAT quarter payment until end of June 2020, which in real terms means that VAT incurred during this period will not be payable until the end of the 20/21 financial year.
The self-employed will now be able to access universal credit, in effect, providing them access to statutory sick pay (SSP).
Tax payments for the self-employed will also be deferred until the next self-assessment date (January 2021).
COVID-19 Business updates for 18th March
Improved measures announced after last week's budget.
In a joint statement today with the PM, the Chancellor set out some details of the economic response and promised more information and targeted action in the days ahead.
Sunak’s measures also included a package of direct support to businesses worth more than £20bn.
The £330bn loan guarantees are designed to provide access to loans “on attractive terms” for all businesses who need it. Larger businesses will be supported by a new lending facility agreed with the Bank of England.
Smaller businesses can access a big extension of the business interruption loan scheme which was first announced last week and the £3,000 cash grant for 700,000 small businesses announced in the Budget has been increased to £10,000.
There will be loans of up to £5m available, with no interest due for the first six months, and the scheme will be “up and running by next week”.
The Chancellor revealed significant investment to support businesses operating in the hospitality, leisure and retail sectors.
Cash grants of up to £25,000 to eligible businesses in the hospitality, leisure and retail sectors were also announced.
In addition, a business rates holiday previously announced for some businesses in those sectors has now been extended to all businesses, which will now pay no business rates for 12 months.