Government Update on Business Support
In the Budget (11 March 2020) the Chancellor announced a package of measures to provide support for public services, individuals and businesses to ensure the impact of COVID-19 is minimised.
A new Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will enable businesses to apply for a loan of up to £5 million, with the government covering up to 80% of any losses with no fees. Businesses can access the first 6 months of that finance interest free, as government will cover the first 6 months of interest payments.
- For businesses with fewer than 250 employees, the cost of providing 14 days of Statutory Sick Pay per employee will be refunded by the government in full. This will provide 2 million businesses with up to £2 billion to cover the costs of large-scale sick leave.
- A dedicated helpline has been set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities receive support with their tax affairs. Through this, businesses may be able to agree a bespoke Time to Pay arrangement. If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s dedicated helpline on 0800 0159 559.
- There will be a £10,000 cash grant to our smallest businesses, delivered by local authorities. Small businesses that pay little or no business rates and are eligible for small business rate relief (SBBR) or rural rate relief will be contacted by their local authority - they do not need to apply. The funding will be provided to local authorities in early April. Guidance for local authorities on the scheme will be provided shortly.
- Finally, the government is introducing a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
- A £25,000 grant will also be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.
Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday will be published by 20 March.
In addition, the decisions announced by the Bank of England on 11 March 2020 mean that banks are in a better position to provide additional credit to smaller businesses.
Business Secretary Alok Sharma said:
'The coronavirus clearly poses multiple challenges for businesses, and I know from regular calls with business representatives that many are concerned about the longer-term effects on investment, cash flow and the future of their businesses.'
'Supporting companies through this period is a top priority and a whole of government effort. The measures set out in the Budget show that this government will support business through this turbulent time and keep the economy moving. We will continue to review these measures as the impact of the virus progresses.'
Author: Susie Campion FCCA
Educated at Lancaster Girls' Grammar School, Susie joined Scott & Wilkinson in 1995 and qualifed as an accountant in 2002. As a Partner, Susie’s specialisms include managing the firm's large group audits and leading on staff...
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