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COVID-19: Latest updates and advice

This page will be regularly updated as new information is released.

We want to reassure all of our clients and colleagues that we remain committed to helping you through this unprecedented time of uncertainty and worry. We will keep this page updated with the most recent information and advice from the UK government, as well as details of all of the financial support available to you.

Our dedicated COVID-19 advice team is on hand to answer any questions and guide you through the process of accessing that financial aid, so please do not hesitate to get in touch:

Email: covidteam@knowleswarwick.com

Phone: 0114 274 7576


COVID-19 Business Guidance and Resources

  • Visit our dedicated Client Resources website for tips, tools and step-by-step guides to accessing the support available. 
  • Download our COVID-19 eBook, which is filled with valuable resources for employers, employees and the self employed. From details about the available financial support, to health advice from the government and the NHS, and a bonus section on managing and maintaining your physical and mental wellbeing during the pandemic, it's an essential read that can be shared with your staff and colleagues.

Financial support for businesses effected by COVID-19

The government has announced a package of measures to help those businesses and self-employed individuals who have been financially imapcted by the coronavirus outbreak.  

Coronavirus Job Retention Scheme (CJRS)

The Coronavirus Job Retention Scheme was announced on 20 March 2020, and opened for applications on 20 April. Payments have now begun to be received by the first applicants.

Under the JRS, HMRC will reimburse 80% of 'furloughed workers' wage costs, up to a maximum of £2,500 per month for each furloughed employee. This is a grant that is being offered to employers to alleviate the need to make redundancies during the pandemic, and will not need to be repaid.

'Furlough', in this instance, requires workers to cease working and follow the government's advice on social distancing and self-isolation by remaining at home. They will remain employed by their current employer, and will receive 80% of their salary in the normal way, which the business will then be able to claim back via a new online portal set up by HMRC. 

Employers can choose to top up their employees' salaries to 100%. Employees may continue to complete any training in order to achieve professional qualifications and maintain CPD whilst on furlough, but may not perform any revenue-generating work for the business.

The CJRS was initially open for three months from 1 March, and has since been extended until the end of June. The Treasury is reported to be in talks about solutions for ending the scheme without risking a raft of redundancies, such as a gradual phasing down of coverage (e.g. 60%, then 40% of pay, etc.) and/or narrowing the scheme's focus to concentrate on sectors that will not be able to reopen in the early stages of lockdown being lifted (e.g. hospitality).

Update: CJRS extended to October 31

Chancellor Rishi Sunak announced on 12 May that the CJRS will continue until the end of October, with furloughed workers continuining to receive 80% of their income, up to £2,500. From August, new flexibility will be introduced, whereby employees can return to work part time, with the time that they're not working still being covered by the scheme.

Employers will also be expected to make a contribution to the 80% salary from the beginning of August, although how much is not yet clear.

More guidance is expected soon.

Update: Furlough for Directors & Owner-managers

Company directors and owner-managers who pay themselves a salary via PAYE can choose to furlough themselves and receive 80% of their PAYE salary from the government's CJRS. Any income that is taken as dividends will, however, not be included, and the director must cease any income-generating work and only perform statutory tasks, such as preparing accounts and tax returns.

Update: Furlough and Ex-employees

The government has amended the date at which an employee must have been on the payroll in order to be eligible for the job retention scheme. Any employee who was on the payroll on or before 19 March 2020 and which were notified to HMRC on an RTI submission on or before this date can be furloughed and the employer may claim 80% of the employee's salary.

In addition, any employee who was on the payroll as of 28 February and has been made redundant or stopped working for the employer between then and 19 March can be re-employed and put onto furlough.

Update: Furlough and Zero hours contracts

Zero hours workers are entitlied to be furloughed and receive 80% of their average monthly earnings, under the CJRS.

Update: Furlough and Volunteering/second jobs

Whilst on furlough, employees are permitted to volunteer, whether by helping the NHS in the fight against coronavirus, or supporting a local charity, for example. They also may take on a second employment in order to supplement their income, if contractually allowed by their first employer.  

Loan Guarantees

The government has announced a range of loan guarantees to provide financial support to a variety of businesses, from the new Bounce Back Loan Scheme for small businesses, to a Covid Corporate Financing Facility for large firms with a turnover of more than £45million.

Covid Corporate Financing Facility (CCFF)

Businesses with more than £45million turnover can access the CCFF, which "will provide funding to businesses by purchasing commercial paper of up to one-year maturity, issued by firms making a material contribution to the UK economy".

The company must satisfy Bank of England lending criteria, which originally meant having an investment grade credit rating from a ratings agency, but has since been changed to also allow lending banks to judge credit worthiness. Howeever, the ultimate decision remains with the BoE.

Coronavirus Large Business Interruption Loan Scheme (CLBILS)

Medium to large sized businesses with a turnover between £45 million and £500 million can apply to the CLBILS. The Large Business Interruption Loan Scheme has a ceiling of £25 million and is targeted at businesses that are too large for the CBILS but fail to meet the criteria for CCFF. This scheme will provide an 80% government guarantee on individual loans and other forms of finance (e.g. overdrafts).

The aim is to provide support for businesses that were viable before the pandemic, but now face significant cash flow difficulties that would otherwise make them unviable for lending in the short term. 

Coronavirus Business Interruption Loan Scheme (CBILS)

Under the Coronavirus Business Interruption Loan Scheme, UK businesses with an annual turnover of no more than £45m may be able to borrow up to £5m interest-free for 12 months under a British Business Bank (BBB) scheme where the government provides the lender with a guarantee for 80% of each loan (subject to a per-lender cap on claims) and covers the cost of the first 12 months of interest.

The scheme supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance faciities. Finance terms are up to six years for term loans and asset finance facilities, and up to three years for overdrafts and invoice finance facilities.

The scheme provides lenders with a government-backed guarantee that could turn a 'no' credit decision by a lender into a 'yes'. Lenders pay a fee to access the scheme, meanng there will be no guarantee fee for SMEs who receive support via the scheme.

Lenders cannot require personal guarantees on borrowing of under £250,000, nor can primary residential property be taken as security under the scheme. When a personal guarantee is required, it is capped at 20% of the outstanding value of the loan.

Business owners can access CBILS through 40 BBB accredited lenders, but not all of these lenders will be able to provide every type of funding. Business should speak to their existing bank lender(s) if they wish to access CBILS. If your current lender is unable to provide the facility they may refer you to another lender.

Bounce Back Loan Scheme (BBLS)

The BBLS will provide micro loans of between £2,000 and £50,000 (subject to a ceiling of 25% of turnover) interest free for the first 12 months, with the government supplying a 100% guarantee for lenders. There will be no forward-looking tests of business viability, nor any "complex eligbility criteria", and "for most firms, loans should arrive within 24 hours of approval". 

The BBLS will be run by the the British Business Bank and will be open for business from 9am on Monday 4 May. You can read the guidance on how to apply when the time comes here.

Support for innovative businesses

On 20 April, Chancellor Rishi Sunak announced a two-part support package for 'innovative firms', which will help those startups and other venture capital backed businesses that do not meet the criteria of the previously announced measures. 

Future Fund

The Future Fund will provide loans between £125,000 and £5 million, with private investors at least matching the government commitment. Eligibility criteria is fairly strict, the business must be unlisted and UK registered/based (at least 50% of employees must be UK based, or at least half of revenue must be from UK sales). The company must have been incorporated on or before 31 December 2019, and it must have previously raised at least £250,000 in equity investment from third party investors in the last five years.

Visit the government's website to apply for the new Future Fund.

Research and development tax relief

The government has pledged £750 million of targeted support for the most R&D intensive small and medium size firms, which will be made available through a grant and loan scheme operated by Innovate UK

Innovate UK will accelerate up to £200 million of grant and loan payments for its 2,500 existing customers on an opt-in basis. An extra £550 million will also be made available to increase support for existing customers and £175,000 of support will be offered to around 1,200 firms not currently in receipt of Innovate UK funding. The first payments will be made in mid-May.

Get in touch if you'd like to discuss a possible R&D tax relief claim.

Business Rate Reliefs

The Chancellor has announced a 12 month business rates holiday for all retail, hospitality and leisure businesses in England and Scotland for the 2020/21 tax year.

Your local authority will adjust the next council tax bill you receive to remove the business rates charge. You can estimate the saving for your business using this calculator (based on English rates).

In Northern Ireland, no rates will be charged for April-June 2020 for all business ratepayers excluding public sector and utilities. There are also reliefs in Wales for retail, leisure and hospitality businesses.

Some businesses may also be able to request Hardship Relief via their local authority.  

Grants

Under the Retail and Hospitality Scheme, businesses can access cash grants of £25,000 for each property in England with a rateable value of £15,001-£51,000 and £10,000 for each property in England with a rateable value of £15,000 or lower. 

Details of the properties that will benefit from the relief can be found here. Your local authority should be able to confirm if you are eligible for a grant.

Small businesses which occupy premises in England and already receive small business rate relief or rural rate relief are eligible for a one-off grant of £10,000 to help meet their ongoing business costs.

Scotland and Wales have announced similar grant schemes. 

Top-up grants

Small businesses that previously fell through the gaps in the available coronavirus government funding can now access a top-up business grant funds scheme. The Business Secretary has made £617 million available to small businesses that did not fit the criteria for the Small Busines Grants Fund or the Retail, Hospitality and Leisure Grants Fund.

Local authorities are responsible for allocating the funds to relevant businesses with less than 50 employees, including those in shared spaces such as bed and breakfasts, regular market traders and small charity properties. 

The maximum grant will be £25,000, with some grants of £10,000, and local authorities will have the discretion to allocate funds of less than £10,000 according to local economic need. Recipients must be able to show that they have seen a significant drop in income due to Coronavirus restriction measures. Further guidance is due to be released.

Tax Measures

VAT payments that would have been due between 20 March and 30 June 2020 have been deferred until 31 March 2021.

Self employed individuals with income tax payments due in July 2020 under the Self-Assessment system can also defer payment until January 2021. This is automatic, no application necessary.

HMRC have also scaled up their 'Time to Pay' service and requests can be made to defer other tax payments including corporation tax and PAYE which are due (or overdue) to HMRC by calling the new dedicated Coronavirus helpline on 08000 241 222 between 8am and 4pm, Monday to Friday.

Statutory Sick Pay (SSP)

Businesses with less than 250 employees can obtain a refund from the government for Statutory Sick Pay paid for up to 2 weeks' absence due to COVID-19. This also covers absence due to self-isolation in line with government advice.

The size of an employer will be determined by the number of people they employed as of 28 February 2020. Employers should keep a record of staff absences and payments of SSP, but employees will not be required to provide a GP fit note. If evidence is required by the employer, those with symptoms can get an isolation note from NHS 111 online and those who live with someone with symptoms can get a note from the NHS website.

The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible.

3-month extension to file accounts

Companies House and the government have launched an initiative providing businesses effected by the coronavirus outbreak with a 3-month extension to file their accounts.

Under normal circumstances, all companies that file accounts late are issued with an automatic penalty, but now, those who apply for the extension and are accepted will have an additional 3-month period to focus on managing the impact of COVID-19 on their business before filing.

All businesses that cite COVID-19 or Health matters as the grounds for the application will be accepted, unless they have already extended their filing deadline or shortened their accounting reference period. Full guidance can be found here.

Applications can be made through a fast-tracked online system which will take just 15 minutes to complete, according to Gov.UK.

Eviction moratorium extended to commercial leases

If your business rents commercial premises and you are unable to pay rent due to the impact of COVID-19, your landlord is now prohibited from evicting you due to a piece of emergency legislation extending the forfeiture moratorium on residential leases to include commercial leases.

Read the press release here.

Alternative Funding

Many alternative funders are still open for business and actively looking to lend during the lockdown. We can help you to investigate opportunities with:

  • Crowdfunding
  • Crowdsourcing
  • Equity crowdfunding
  • Peer to peer lending
  • Asset finance
  • Supply chain finance and Reverse factoring
  • Pension led funding
  • Merchant cash advance

Please be aware that fraudsters are already taking advantage of the situation and targeting individuals with coronavirus-related scams. If you are unsure, please speak to your advisor before making any decisions about your finances, particularly with regard to savings and pensions. 


Financial support for self-employed affected by COVID-19

On Thursday 26 March, the government announced its new scheme to support self-employed professionals who have been financially impacted by the continuing coronavirus pandemic. 

Self-Employment Income Support Scheme (SEISS)

If you are self-employed or a member of a partnership, you can claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next three months, based on your income over the last three years.

Your trading profits must be less than £50,000, and more than half of your income must come from self-employment. To be eligible, you must have submitted your Income Tax Self Assessment tax return for the tax year 2018-19 and have traded in 2019-20, and still be trading or would be except for COVID-19. 

Unlike the CJRS, where staff must be furloughed and cease working, self employed individuals are not expected to stop operating their business in order to receive the SEISS funding.

HMRC are aiming to contact eligible people "by mid-May 2020", and payments will be made from the beginning of June.

For full details and to make a claim, click here.


Our dedicated COVID-19 team can help you to access the funding available to your business, please get in touch on 0114 274 7576 or email us at covidteam@knowleswarwick.com to find out more.


Latest updates and advice

21 May 2020

Late IR35 amendment shot down in parliament

18 May 2020

Off payroll extension may be delayed until 2023

15 May 2020

HMRC relaxes stance on home office equipment

14 May 2020

COVID-19 puts economy into significant recession

13 May 2020

Relief as furlough scheme extends to October

5 May 2020

Self employed to start claiming coronavrus grants

4 May 2020

New grants for shared-property businesses

28 April 2020

New microloans revealed for small firms

27 April 2020

Shops get rent break during crisis

24 April 2020

Govt. to offer 100% guarantee on SME loans

23 April 2020

Growing tech startups get £250m lifeline

22 April 2020

Chancellor expands loan scheme for large firms

21 April 2020

One-month extension for furlough scheme

20 April 2020

Coronavirus job retension scheme goes live

16 April 2020

New starters in job retension scheme boost

14 April 2020

'Self-employed can claim support in mid-May'

9 April 2020

Chancellor pledges £750m for charities

3 April 2020

Public sector contractors in furlough boost

1 April 2020

Second phase of MTD for VAT delayed

31 March 2020

Govt. urged to plug gaps in self-employed scheme

30 March 2020

Govt. updates Coronavirus Job Retention Scheme advice

26 March 2020

Three month extension for firms to file account

25 March 2020

Warning on coronavirus related scams

24 March 2020

Parliament mulls statutory self-employed pay

23 March 2020

Government to pay 80% of workers' wages

20 March 2020

IR35 changes postponed for twelve months

19 March 2020

COVID-19 postpones off-payroll extension to the private sector

18 March 2020

Government provide £330bn lifeline to businesses

Minimising the effects of a pandemic on your business

16 March 2020

Help for business during the coronavirus pandemic


Additional Resources

GOV.UK Coronavirus (COVID-19) Guide

Coronavirus Advice Tool from Champion Health

 

Happiness is a Positive Cash Flow

Click here for the Quickbooks website Xero Gold Partner Accountants Sage accountants, experts in cloud accounting, Sheffield, South Yorkshire 

ICAEW Chartered Accountants Click here for the ACCA website Connect Yorkshire  Sheffield Chamber of Commerce Click here for the Caunce O'Hara website 

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