COVID-19: Support for Businesses
At HiThrive, we are committed to helping and supporting small businesses during this challenging time.
This blog post is to help support you, your people and your business through the uncertainty of the global COVID-19 outbreak. We’ll continue to add useful resources and information to this page as they become available. This article was first published on April 3, 2020.
Help for your business
The UK government has announced support for those affected by COVID-19 ↗ This includes a package of measures to support businesses, including:
Paying employees
Paying employees under the Coronavirus Job Retention Scheme
Updated - Since March 2020, the UK government has supported PAYE registered businesses with a grant to cover part of your employees’ salary if those employees would otherwise be made redundant.
If you cannot maintain your workforce because your operations have been affected by COVID-19, you can furlough employees and apply for a grant to cover a portion of their usual monthly wage costs where you record them as being on furlough.
Employers can bring furloughed employees back to work for any amount of time and any work pattern while still claiming the grant for the hours not worked.
The Coronavirus Job Retention Scheme has been extended on several occasions and currently available until 30-September 2021. For periods ending on or before 30-June 2021, you can claim 80% of an employee’s usual salary for hours not worked, up to a maximum of £2,500 per month, and employers will pay employer National Insurance Contributions (NICs) and pension contributions only for the hours the employee does not work. From 1 July 2021, the level of grant will be reduced each month, and employers will need to contribute towards the cost of the furloughed employees’ wages.
As under the current CJRS, flexible furloughing is allowed in addition to full-time furloughing. Further details, including how to claim, is available on the gov.uk website ↗
Statutory sick pay for small businesses
Small to medium businesses are eligible to reclaim up to two weeks’ Statutory Sick Pay (SSP) for employees who were off work due to COVID-19. To be eligible, your business must have had fewer than 250 employees as of 28 February 2020.
The online service you’ll use to reclaim SSP is not available yet. HMRC will announce when the service is available, and government guidance will be updated accordingly.
Further information, including details of records that you must keep, are available on the gov.uk website ↗
Paying tax
Deferring VAT payments
Updated - Last year, the UK government allowed VAT-registered businesses in the UK to defer VAT payments for three months between 20 March 2020 and 30 June 2020.
If your business took advantage of this, and you still have payments to make, you can choose to:
pay the deferred VAT in full, on or before 31 March 2021
join the VAT deferral new payment scheme – the online service is open between 23 February 2021 and 21 June 2021
contact HMRC on Telephone: 0800 024 1222 by 30 June 2021 if you need extra help to pay
The VAT deferral new payment scheme is open from 23 February 2021 up to 21 June 2021.
If you’re on the VAT Annual Accounting Scheme or the VAT Payment on Account Scheme, you can join the scheme from 10 March 2021. The new scheme lets you:
pay your deferred VAT in equal instalments, interest-free
choose the number of instalments, from 2 to 11 (depending on when you join)
For further information, including details of how to join, visit gov.uk ↗
Deferring Self-Assessment payments
Updated - As one of the government’s coronavirus (COVID-19) supporting measures, Self Assessment taxpayers were given the option of deferring payment of their July 2020 Payment on Account until 31-January 2021.
If you deferred this payment, you might have had these 3 payments to make on 31 January 2021:
your deferred July 2020 payment on account (if it remains unpaid)
any 2019 to 2020 balancing charge
your first 2020 to 2021 payment on account
If you are having difficulty in making these payments, you may have chosen to set up a Time to Pay instalment arrangement with HMRC (see below).
HMRC’s Time To Pay Scheme
If you’re finding it difficult to pay monies owed to HRMC, you’ll be pleased to know that they offer a scheme to help businesses. A Time to Pay Arrangement with HMRC is a debt repayment plan for your outstanding taxes. Companies that have defaulted on their payments to settle their Corporation Tax, VAT and/or PAYE can ask HMRC for extra time to pay. They will usually agree that you can pay it back over a 6-12 month period.
Time to Pay Arrangements are made directly with HMRC. For more information, take a look at their website on how to set up a time to pay arrangement ↗
Support for the self-employed
Self-employment Income Support Scheme
Updated - The Self-Employment Income Support Scheme (SEISS) has so far allowed individuals to claim three taxable grants. The scheme was set to close in January 2021; however, it has been announced that the government will issue a 4th grant.
The fourth grant will provide a taxable grant calculated at 80% of 3 months’ average trading profits. The fourth grant will be paid out in a single instalment and capped at £7,500 in total.
To allow HMRC to process the recently submitted 2019 to 2020 Self Assessment tax returns, the online claims service for the fourth grant will be available from late April 2021 until 31 May 2021.
If you are eligible, HMRC will contact you in mid-April to give you your personal claim date. This will be the date that you can make your claim from.
Please note, the grants are subject to Income Tax and National Insurance Contributions. Further information is also available at gov.uk ↗
Business rates relief
12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
The UK Government has announced plans to introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
Providing your business is based in England and is in the retail, hospitality or leisure sector, you are eligible. More information on eligibility is set out in the government’s expanded retail discount guidance ↗
There is no action required for you to access this support. However, local authorities may have to reissue your bill to provide this support.
Business loans
Coronavirus Business Interruption Loan Scheme
The Coronavirus Business Interruption Loan Scheme is a new and temporary scheme designed to support SMEs. It provides small and medium-sized business with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.
The government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.
The government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The scheme will be delivered through commercial lenders, backed by the government-owned British Business Bank.
Applications for this government loan scheme are open until 31 March 2021. Find out if you’re eligible and how to apply ↗
Coronavirus Bounce Back Loan
The coronavirus Bounce Back Loan Scheme (BBLS) is designed to enable smaller businesses to access finance more quickly. Small and medium-sized businesses can borrow between £2,000 and 25% of their turnover, up to a maximum of £50,000.
This 6-year loan is fully government-backed, and there are no fees or interest to pay for the first 12-months. After 12-months, the interest rate will be 2.5% per year with no early repayment fees.
On 24 September the government announced a new Pay as You Grow flexible repayment system. This is designed to provide flexibility for businesses repaying a Bounce Back Loan. Included in this system is extending the length of the loan from six years to ten, the introduction of interest-only periods of up to six months, and payment holidays will also be available to businesses.
Applications for this government loan scheme are open until 31 March 2021. More information is available from the British Business Bank website ↗
For businesses that have already taken the loan but didn’t borrow the maximum amount permitted under the scheme (i.e. 25% of total turnover), there’s now the option to 'top-up' your Bounce Back Loan.
New - Recovery Loan Scheme
The Recovery Loan Scheme is designed to ensure that businesses of any size can continue to access loans and other kinds of finance. Amounts up to £10 million per business can be accessed once the existing COVID-19 loan schemes close.
Once received, the finance can be used for any legitimate business purpose, including growth and investment.
The government guarantees 80% of the finance to the lender to ensure they continue to have the confidence to lend to businesses.
The scheme launches on 6-April 2021 and is open until 31-December 2021, subject to review. Loans will be available through a network of accredited lenders. More details can be found at gov.uk ↗
Support for businesses affected by coronavirus restrictions
The government has a range of grants available for businesses that have been affected by coronavirus restrictions. Check the links below to see if your business is eligible for any of the following:
National Lockdows - for closed businesses ↗
Businesses that were open as usual but then required to close due to national lockdowns imposed by the government may be eligible for the LRSG(Closed) Addendum schemes.
Closed Businesses Lockdown Payment ↗
The Closed Businesses Lockdown Payment (CBLP) supports businesses that have been required to close due to the national lockdown that began 5-January 2021.
Additional Restrictions Grant ↗
The Additional Restrictions Grant (ARG) supports businesses that are not covered by other grant schemes or where additional funding is needed.
Nightclub, dance hall and adult entertainment businesses ↗
The Local Restrictions Support Grant (LRSG (Sector)) supports businesses that have been closed due to national restrictions.
Local Restrictions - for open businesses ↗
The Local Restrictions Support Grant (LRSG (Open)) supports businesses that have been severely impacted due to temporary local restrictions.
Local Restrictions - for closed businesses ↗
The Local Restrictions Support Grants (LRSG (Closed) and LRSG (Closed) Addendum: Tier 4) support businesses that have been required to close due to temporary local restrictions.
Christmas Support - for wet-led pubs ↗
The Christmas Support Payment (CSP) supports wet-led pubs that have been severely impacted over the Christmas period due to temporary local restrictions.
Free Advice for Local Businesses
At HiThrive, we are fully aware that small businesses require help now more than ever. In partnership with Newcastle’s Business & IP Centre, we are able to offer free one-to-one advice to local businesses. Read our blog for more information and details on how to book your session.