Support for Businesses
On this page you will find the links to the relevant government information being issued on various support schemes to help businesses through Coronavirus. We are here to help if you have questions about the information below.
Coronavirus Job Retention Scheme
The portal to claim grants under the Coronavirus Job Retention Scheme is now open.
You can make a claim once every three weeks and only for periods of furlough 3 weeks and over. HM Revenue & Customs advise that claims should be made in line with payroll to ensure calculations are correct and there is a clear audit trail of how claims are calculated. For full details on how you can do this, please view the guidance: https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme. HMRC state that the grants will be paid in 6 working days.
Bank Holidays and Annual Leave
We have now received guidance on how holiday and bank holidays are dealt with in the Furlough Grant . Here is a step by step guide for employers: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/880099/Coronavirus_Job_Retention_Scheme_step_by_step_guide_for_employers.pdf
If a furloughed employee takes holiday, the employer should pay their usual holiday pay in accordance with the Working Time Regulations.
Employers will be obliged to pay additional amounts over the grant, though will have the flexibility to restrict when leave can be taken if there is a business need. This applies for both the furlough period and the recovery period.
If an employee usually works bank holidays then the employer can agree that this is included in the grant payment. If the employee usually takes the bank holiday as leave then the employer would either have to top up their usual holiday pay, or give the employee a day of holiday in lieu.
We have now had released further details on how the Coronavirus Job Retention Scheme (CJRS) will work. For full details on how the different elements of this may apply to you please go to: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
Coronavirus Statutory Sick Pay Rebate Scheme
This scheme is due to launch online on 26 May and will enable employers with fewer than 250 employees to claim coronavirus related Statutory Sick Pay (SSP).
The repayment will cover up to 2 weeks of the applicable rate of SSP for employees who:
- have coronavirus (Covid-19) symptoms
- cannot work because they are self-isolating because a member of their household has symptoms
- are sheilding.
Full details can be found at https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19
One disappointing aspect of the support so far is that there has been little support aimed at directors of limited companies.
Whilst directors are able to place themselves on furlough if they are on the PAYE scheme for the business, this then means that they are limited to only carrying out statutory duties for the firm and unable to generate work.
Income provided by dividends or other payments from the company are not eligible for support.
Self-Employed Income Support Scheme
Following the government’s announcement on 26 March 2020 that there was to be a support scheme for the self-employed, there are some further details now available.
You can claim if you are a self-employed individual or a member of a partnership and you:
- Have submitted your self-assessment tax return for the tax year 2018/19;
- Traded in the tax year 2019/20;
- Are trading when you apply, or would be except for coronavirus;
- Intend to continue to trade in the tax year 2020/21;
- Have lost trading profits due to coronavirus;
Your trading profits must also be:
- Less than £50,000 AND more than half of your total income for EITHER the tax year 2018/19 OR the average of the tax years 2016/17, 2017/18 and 2018/19.
It is our understanding that total income will be taken directly from your tax returns that have already been submitted.
What Is Trading Profit?
- HMRC guidance indicates that, broadly, trading profits will be your business income less allowable business expenditure, less capital allowances.
- Deductions such as pensions or Gift Aid will be ignored.
- This is likely to correspond with boxes on the self-assessment return and these figures will be directly lifted by HMRC for your claim.
Check Your Eligibility Now
You can now check your eligibility online with HMRC https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme#eligible, you will need your Unique Taxpayer Reference (UTR – a 10-digit number which can be found on any correspondence you have received from HMRC) and your National Insurance (NI) number to do this
We would recommend that you do this. HMRC will then tell you when you will be able to make a claim.
How Much Will You Receive?
- The average of your trading profits over the three years 2016/17, 2017/18 and 2018/19. The grant will be the lower of 80% of the average trading profit divided by 12 or £2,500 per month for three months.
- Where losses have been experienced during this time they will be treated as negative figures.
- For farmers, the figures will be taken prior to any averaging computations.
- Where one of the years is a short period, e.g. in an opening year, there will be no pro rata’ing during the short period.
Other Things To Think About
- Where you have two trades, HMRC will simply add these together.
- The figures will be based on figures from continuous periods of self-employment, so where there has been a gap the three-year average will not be applied.
- Any amendments to your 2019 tax return carried out after 26 March 2020 will be disregarded by HMRC.
- You can continue to work throughout the period and still make a claim.
How Do You Get Your Money?
- Your 2018/19 tax returns must have been submitted prior to Thursday 23 April.
- HMRC will calculate the grant using the figures on your tax return.
- You will not be asked to calculate the claim or provide figures to them.
- The grant is taxable and Class 4 NIC’s apply.
- The grant will have to be reported on your 2020/21 tax return.
- HMRC are opening the claim portal on 13 May 2020 and aim to pay you within 6 working days of a successful claim.
Please note what you will need to make the claim:
- Self Assessment UTR
- National Insurance Number
- Government Gateway User ID and Password
- Bank account number and sort code
Things To Do Now
You will need a Government Gateway ID and business tax account to complete the declaration online. If you do not have one already here is a link to enable you to set this up: www.gov.uk/log-in-register-hmrc-online-services. We recommend that you do this as soon as possible.
Please note that we do not have individual government gateway ID’s for clients, we submit all your data to HMRC as your Agent. If you have not already set up your own Government Gateway account you will need to do so as soon as possible.
Be aware of scams. You should be certain that before providing any bank details that the correspondence you have received is legitimate and from HMRC. If you are in any doubt, please do not respond and contact us immediately.
Please be aware that when you are completing the online registration you will be asked to tick a box to say that you have continued to trade through 2019/20 and intend to continue to do so and that you have lost trading profits due to coronavirus.
Other Help Available
Whilst you are waiting for this grant to be paid you may be eligible for Universal Credit and we would encourage you to explore this: https://www.gov.uk/universal-credit. Please be aware that the receipt of the Self-Employed Income Support Scheme will need to be declared as income for Universal Credit purposes, however, this will only be in the month of receipt. This may mean that you are entitled to Universal Credit in the months leading up to the payment of the grant.
Working Tax Credits
If you are already in receipt of Working Tax Credits we would encourage you to finalise your 2019/20 claim as soon as possible, allowing you to provide cautious expected income for 2020/21 taking into account the effect on your business of coronavirus.
Please Note: if you are in receipt of Working Tax Credits please think carefully before applying for Universal Credit as once you have done so you cannot go back to the Working Tax Credit system.
We will keep you informed of any other information as we receive it. If you would like our help please contact us by emailing [email protected].
Here is a link to the full guidance: https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme
Business Rate Relief Grants
These were one of the first initiatives rolled out.
The Retail, Hospitality and Leisure Grant means that businesses in these sectors with a rateable value of up to £15,000 get a grant of £10,000 whilst those with property valuations between £15,000 and £51,000 will be eligible for a grant of £25,000.
The Small Business Grant Fund means that any business eligible for small business rate relief or the rural rate relief scheme is eligible for a grant of £10,000.
Anyone eligible for a grant such as this was contacted by their local council and asked to provide payment details for it to be paid directly into bank accounts with no application process necessary.
If you think your business fits into either of these schemes and you haven’t received your grant, please contact us for help.
A further grant has recently been announced with funds being released to local authorities specifically aimed at businesses operating from shared workspaces, market stalls and charity shops, along with B&B’s not paying business rates.
We are currently in discussions with our local council about this and will inform you as soon as this scheme is open.
As always, full details of all government backed initiatives are available on their website: https://www.gov.uk/coronavirus/business-support
Bounce Back Loans
The Bounceback Loan Scheme (BBLS) has been set up to allow smaller business to access funds more quickly during the Conronavirus pandemic.The scheme helps small and medium businesses borrow between £2,000 and up to 25% of their turnover up to £50,000. The scheme is 100% guaranteed by the government and there will be no fees or interest for twelve months. After twelve months the interest rate will be 2.5%.
For full details and how to apply go to: https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan
For businesses needing to borrow more than £50,000 applications can be made under CBILS https://www.gov.uk/guidance/apply-for-the-coronavirus-business-interruption-loan-scheme. These loans are more process heavy than the bounce back loans.
Other Support Available for Businesses
The government has now passed legislation to start helping businesses through this difficult time. We predict that the support and advice available is going to change very quickly on this issue and would suggest you review the guidancedirectly from the offical government website as to what specific assistance applies to you and your business:
This will be updated by the government regularly as support develops and increases, so is the best source of information for you to begin with.
Due to the current uncertainty and regular announcements we are experiencing an extremely high volume of queries. Please bear with us, we will get in touch with everyone but it may take us a bit longer than normal. We are working on this as a team and you may speak to any one of our senior accountants rather than your normal accountant depending on the query and the volume of questions on any given day.
We are working very hard to support you through these difficult times and will keep in touch.