What COVID-19 grants/loans can my business claim or what other forms of support is available? A question several clients have been asking their FinanceHead part-time FD. We realise the confusion that is caused by so many different government financial initiatives to support businesses during coronavirus that we have compiled an easy reference and included some finance tips to manage your cash flow.
We hope that this COVID-19 mini-portal of information for financial resources and links will help business owners during this challenging time.
Please bear in mind whilst we endeavour to keep this updated with any financial support from the government it is not guaranteed. Support to business is changing but we will do our upmost. Please let us know of any additional support you've heard about and would like to share, perhaps it is sector-specific?
UK Government Support & Loans
There is a range of financial support for businesses during COVID-19. You can view the key ones below as outlined by FinanceHeads. Please visit the Government’s online portal
Coronavirus Job Retention Scheme
HMRC will reimburse 80% of wages for furloughed workers that are still on payroll, up to £2,500 a month plus Employers NIC and minimum auto-enrolment pension contributions. This will be back dated to 1 March and is expected to run for at last three months. Employees will be subject to income tax and NIC.
From 1 July, furloughed employees can return to work, with the government covering pay for hours not worked and employers covering pay for hours worked.
From August 2020, the level of government grant provided through the Job Retention Scheme will begin to be reduced, with businesses asked to contribute an increasing share.
The online platform is the best place to start. This scheme is changing frequently.
Coronavirus Large Business Interruption Loan Scheme
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) will provide a Government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of over £45 million.
The scheme will be delivered through commercial lenders, backed by the British Business Bank.
For more information and how to apply go to CLBILS page.
Bounce Back Loan Scheme
The Bounce Back Loan Scheme (BBLS) is designed to help small and medium-sized businesses to borrow between £2,000 and £50,000. Delivered through accredited lenders the Government will guarantee 100% of the loan and loans will carry no fee or interest for the first 12 months. Loan terms will be up to six years. The Government will work with lenders to agree on a low rate of interest for the remaining period of the loan. Companies must be UK based, have been adversely impacted by COVID-19, and were not classified as an ‘undertaking in difficulty’ on 31 December 2019.
Visit this page to apply.
Cash Grant for Retail, Hospitality and Leisure
Businesses in retail, hospitality or leisure in England, with a rateable value of:
- £15,001 to £51,000 can receive a grant of up to £25,000 per property
- < £15,000 can receive a grant of £10,000.
Detailed guidance from BEIS can be found here.
Coronavirus Business Interruption Loan Scheme (CBILS)
Businesses with a turnover of less than £45 million per annum can access lending facilities of up to £5 million, with an 80% Government guarantee. Interest and fees arising in the first 12 months of any facility taken out under this scheme will be paid by the Government (as a Business Interruption Payment).
The scheme is not borrowing from the Government – rather it is a case of the Government acting as guarantor-of-last-resort on loan applications made to the 50 accredited lenders who are part of the scheme.
To apply, visit the government guidance CBILS page.
The Government through the British Business Bank will match private investments into UK companies through a convertible loan instrument, investing between £125,000 and £5,000,000 per company.
The scheme is suitable for companies that are unable to access the Coronavirus Business Interruption Loan schemes (CBILs) and who are funded by external investors. To be eligible businesses must have already raised at least £250,000 in aggregate over the preceding five years from third-party investors. The scheme will run from May - September and is at present capped at £250 million of Government money. Companies must be UK based. To apply to the Future Fund page.
Small Business Grant Funding
The Government will provide Local Authorities with £10,000 per business to support small businesses under the small business rate relief (SBRR), rural rate relief (RRR) and tapered relief. For further details view this guide from the Ministry of Housing, Communities and Local Government.
How to claim? Your local authority will contact you with details of how to claim the grant. Contact your local authority if you haven’t heard from them and you are entitled.
Statutory Sick Pay Rebate
The Government will allow SMEs to reclaim Statutory Sick Pay (SSP) for staff sickness absence due to coronavirus. This will cover up to two weeks’ SSP per eligible employee.
Available for organisations with fewer than 250 employees who qualify as SMEs. To claim and for more details visit this page.
Ban on Evictions for Commercial Tenants
These measures, included in the emergency Coronavirus Bill, will mean no business will be forced out of their premises if they miss a payment in the next 3 months
Manage your cash flow
Time to Pay
All businesses and self-employed people in financial distress, with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay (TTP) service. Businesses may request a deferral of tax debts to be paid in instalments over a set period (typically 3-12 months). For full details view this publication.
Businesses will be supported by deferring Value Added Tax (VAT) payments for three months.
For the self-employed
Income Tax Deferral for the Self-Employed
Income Tax payments due in July 2020 under the Self-Assessment system can be deferred to January 2021.
Self-employed Income Support Scheme
Self-employed individuals and members of partnerships who have lost income due to COVID-19 can claim a taxable grant of 80% of trading profits up to a maximum of £2,500 per month for three months (with potential extension).
Check if you can claim a grant here.
The Business Finance Guide – COVID-19 - https://thebusinessfinanceguide.co.uk/covid-19/
Government Support Finder Tool - https://www.gov.uk/business-coronavirus-support-finder
Government Coronavirus Business Support Master Page - https://www.gov.uk/coronavirus/business-support
British Business Bank Bounce Bank Loan Scheme - https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/
FinanceHeads are here to help businesses survive and thrive
As you can see the range of support and documents required to claim can be overwhelming. FinanceHeads have been guiding their clients through this and helping with the forms and reports required. Let one of them help your business during this testing time. Contact Michael Cartwright for an introduction and time the first step to your own part-time Financial Director, could be a one-off or a regular commitment.
Last updated: 25 May 2020