CORONAVIRUS BUSINESS SUPPORT OVERVIEW
UPDATE 24 SEPTEMBER
Chancellor Rishi Sunak has announced the latest business support packages in light of the ongoing challenges of Coronavirus.
JOB SUPPORT SCHEME – replacing the furlough scheme when it ends on 31 October
- Businesses will have the option of keeping employees in a job on shorter hours, rather than making them redundant.
- Under the scheme, the government will subsidise the pay of employees who are working fewer than normal hours due to lower demand
- It will apply to employees who can work at least a third of their usual hours.
- Employers will pay employees for the hours they do work.
- For the hours employees can’t work, the government and the employer will each cover one third of the lost pay.
- The grant will be capped at £697.92 per month.
- The scheme will be targeted at businesses that need it most – all small and medium-sized firms – but only for big companies if turnover has fallen by a third.
- All small and medium sized businesses will be eligible for the scheme.
- Larger business will be eligible if their turnover has fallen during the crisis.
- Firms can claim both the jobs support scheme and the jobs retention bonus.
- It will be open to employers across the UK even if they have not previously used the furlough scheme.
- The scheme will run for six months starting in November.
- The new self-employment grant will cover 20 per cent of a self-employed person’s average monthly profits from November to January next year, up to a total of £1,875.
- From February 2021 to the end of April, a second grant will be available to self-employed workers. It has not yet been announced how much this second grant will cover.
- Only those who made less than £50,000 a year in profit between the 2016 and 2018 tax years were eligible to claim the previous grants. Payments were based on the average 80 per cent of earnings, up to £2,500 per month.
- Businesses must be actively trading in order to be eligible for the grant, even in cases where they’re facing reduced demand because of the pandemic.
- Anyone who was eligible for the original self-employment income support scheme (SEISS) will be entitled to the new help.
- Income tax deferrals will allow the self-employed to defer self-assessment income tax payments (usually due in July) to be deferred until the end of January 2021.
- “Pay as you grow” to help companies repay state-backed business loans.
- Loans can be extended from six to 10 years, almost halving repayments. Interest-only payments can be made, and firms in “real trouble” can suspend their payouts.
- All of the government’s state-backed loan schemes will be extended until the end of 2020, and the government is starting work on a new guarantee loan programme to begin in January.
- The chancellor will allow businesses to spread their VAT bills over 11 separate payments.
- The chancellor is cancelling a planned increase in VAT, keeping a lower rate of 5% VAT for hospitality and leisure firms until 31 March 2021. This was due to have been increased to 20% on 13 January.
The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.
This includes a package of measures to support businesses including:
- a Coronavirus Job Retention Scheme.
- deferring VAT and Income Tax payments.
- a Self-employment Income Support Scheme.
- a Statutory Sick Pay relief package for small and medium sized businesses (SMEs).
- additional Scottish Government business support – updated 27th April.
- 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 rateable value between £15,000 and £51,000.
- 100% Government guaranteed Business Bounce Back loans from £2,000 – £50,000 for SMEs – interest and repayment free for for the first 12 months.
- the Coronavirus Business Interruption Loan Scheme offering loans from £50,000 up to £5 million for SMEs through the British Business Bank’s accredited lenders.
- the Large Coronavirus Business Interruption Loan Scheme (LCBILS) offering loans of up to £25 million to businesses with turnover from £45 million – £250 million & up to £50 million to businesses with turnover of over £250 million.
- the HMRC Time To Pay Scheme.
To find out how CBILS will impact EIS Tax Relief, click HERE.
All pages within this section will be updated as more information becomes available.