COronavirus : practical business advice

MARKETING AND BUSINESS ADVICE FOR SMALL AND MEDIUM-SIZED BUSINESSES DURING THE CORONAVIRUS OUTBREAK

These are tough and uncertain times for almost every business. So this page has been set up to help as many SMEs as possible with marketing and business advice, including links to specific government information.

This page will be updated regularly to ensure it includes the latest government announcements:

Updated: 1st June 2020

Guidance on the measures to help businesses

The latest, direct government advice can be found in this link. I have summarised the key points below:

For employees on the payroll on or before 19th March but with no work to do, the government will pay 80% of their monthly wages up to £2,500. This can be topped up to 100% by the employer. Any business can qualify, but the employees must be designated ‘furloughed workers’.

Applications using the online claim service can be made from 20th April and the scheme can be backdated to 1st March. It takes 6 working days for government payments to arrive in employer’s accounts. The scheme has now been extended to October, with increased flexibility beginning in August.

Note also that employees that have left the business between 28th Feb and 19th March (either voluntarily or by redundancy) can be re-employed and put on furlough, if the business chooses.

The government will cover the first 12 months of interest payments and lender-levied fees on loans of up to £5m to businesses needing cash before the end of April, available through high-street banks. Loans can also be interest-only repayment in the first 12 months.

Loans can be for 3-months up to 6 years, for businesses with turnover of less than £45m, and there are a small number of sectors that aren’t covered.

As CBILS has been difficult to access, from 4th May companies can apply for a loan for 25% of their turnover up to a maximum of £50,000. No repayments are required for the 12-months and interest payments for the first 12-months will be paid by the government.

Loans can be up to 6 years and will be 100% guaranteed by the government, with checks only to prevent fraud. It is not possible to also have a CBILS loan, but CBILS can be converted to a Bouce Back loan.

From May 2020, convertible loans of £125,000 to £5m will be available for innovative companies that rely on equity investment.

The funding must be matched by private investors and the company must have raised at least £250,000 from 3rd party investors in the last 5 years. More details to follow when available.

VAT payments for the period 20th March 2020 to 30th June 2020 will not be required until 31st March 2021 for all businesses. However, VAT refunds and reclaims will be paid by the government as normal. 

For the self-employed, income tax payments due in July 2020 are deferred to January 2021. This deferral is automatic.

Any business under 250 employees can reclaim up to 14 days statutory sick pay, caused by COVID-19. The 3-day waiting period has also been removed.

The mechanism for repayment will be put in place in the coming months.

A grant of up to £25,000 for businesses with a rateable value of up to £51,000.

There is a 12-month holiday for business rates from 1st April. This will be applied automatically, but may require the council to reissue the council tax bill. This relief can also be claimed by nurseries.

For businesses that already pay little or no business rates due to relief through Small Business Rate Relief (SBRR), Rural Rate Relief (RRR) or tapered relief, they will be eligible for a £10,000 cash grant.

This grant is automatic and local councils will write to eligible businesses.

All businesses that owe tax and are in financial distress can apply for delayed payment with HMRC. To apply call HMRC at 0800 024 1222.

The self-employed can apply for a grant of 80% of their average monthly profits, capped at a taxable amount of £2,500 per month.

To be eligible, the person must have trading profits of less than £50,000, receive over 50% of their earnings from self-employment, and have filed a return for 2018-19 by 31st January 2020, have traded in 2019-20, intend to continue trading in 2020-21, and have lost income due to COVID-19. For eligible persons, there’s an extended window to 23rd April 2020 for filing if the January deadline was missed.

HMRC will contact eligible people directly. Although backdated to March 2020, a lump payment will not be received before June 2020.