A plain English explanation of the coronavirus small business help available in the UK, including links. Coronavirus is impacting small businesses in different ways. Some people are significantly affected, while others are carrying on as normal. If you need coronvirus small business help then please just get in touch. We will be happy to do what we can – for free.

Coronavirus Help Video

We have recorded a short video that explains some general procedures for managing your small business in a crisis.

In summary:

  1. Cash is king – Protect your cash balance by carefully managing the money coming in and the money going out. Consider building a cashflow projection.
  2. Monitor your pipeline – Track the number of leads coming in and sales closing – what happens in your pipeline is often reflected in your financials some time later.
  3. Look after your current customers – Deliver flawless products and services, and make yourself indispensable.

Weekly Small Business Group Phone Call

This is a free group phone call to help small business owners manage their way through the current crisis. Every Thursday at 6pm dial the following number to join a group of small business owners.

Dial: 020 3582 4515 Then: 194 530 117#

Each week we will provide:

  1. The latest news on Government support for small businesses.
  2. Procedures to protect your business during difficult times.
  3. Answers to your questions.
Coronavirus Small Business Help

Government Coronavirus Small Business Help

Here are the main sources of coronavirus small business help for small businesses that we’re currently aware of.

This list will be continually updated.

Sources: Link | Link | Link | Link | Link

Coronavirus Business Interruption Loan Scheme

The government is keen for small businesses to borrow money via banks to help see them through the crisis. To encourage this to happen the government has pledged to underwrite most of the loan – meaning that business owners who may not have been able to borrow in the past may now be able to do so.

Loans are to be interest-free for 12 months (increased from 6 months). It is unlikely that loan arrangement fees will be applied. Loans worth up to £5m are to be made available.

The process will be to speak to your bank in the first instance. The scheme will be available from early week commencing 23 March 2020.

One-Off Grant

If you have commercial premises and are eligible for Small Business Rates Relief (i.e. you don’t pay full business rates) or Rural Rates Relief then you should receive a one-off cash grant of £10k (originally the figure was £3k).

The grant is designed to help cover the cost of you rent – item which the government believes is typically the second biggest fixed cost for small businesses.

This grant does not have to be applied for. It will be administered by your local authority – so you should expect to hear from them.

Government website suggests grants should be received in early April.

Deferred VAT

Businesses no longer have to pay any VAT bills from 20th March to until 30th June. Payment can be deferred until the end of the current financial year (31st Mar 2021). If you pay quarterly the following timelines likely apply:

  • VAT quarter ending in Feb… Payment Normally Due 7th Apr… Defer payment until 31st March 2021.
  • VAT quarter ending in Mar… Payment Normally Due 7th May… Defer payment until 31st March 2021.
  • VAT quarter ending in Apr… Payment Normally Due 7th Jun… Defer payment until 31st March 2021.

Submit your VAT return as normal, but DON’T pay the balance you owe. Instead, retain the cash in your business and pay the balance at year-end. If you pay VAT by Direct Debit you may need to cancel the Direct Debit mandate at your bank.

Job Retention Scheme

Rather than laying off staff, employers will be able to apply to retain staff with the government paying 80% of salaries up to a maximum of £2.5k / month.

An application process will become available. Conditions will inevitably apply – the word “furlough” was used by the Chancellor.

The scheme is backdated to start from 1st March. It is set to run for a three month period. If necessary the scheme will be extended beyond the initial three month period.

More details to follow.

Reclaim Sick Pay

Small businesses will be able to reclaim the cost of 14 days of statutory sick pay. This equates to just under £200 per employee – so it’s not huge, but every little helps.

“Eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force” – The eligibility period is linked to regulation – not clear when exactly this is.

Unfortunately it looks like it will be some time before this reclaim can be made and money received. There is currently no government mechanism for this.

Helpfully, a doctor’s note will NOT be required!

HMRC Time to Pay

The ‘Time to Pay’ scheme is basically coming to a payment agreement with HMRC on tax liabilities. For example, if you have a £10k Corporation Tax bill, you could propose to HMRC that this is paid in 10 monthly instalments of £1k.

The scheme works with all the main taxes – Corporation Tax, VAT, Income Tax, CIS, PAYE, etc.

It’s unclear what (if any) interest rate(s) will apply.

Retail, Leisure and Hospitality

The government will not charge business rates on companies in the retail, leisure and hospitality sectors in 2020-21.

A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000.

Expect communication via your Local Authority regarding these measures.

Self Employed / Sole Trader

If you have income tax payments due on 31st July 2020 then these can be deferred until 31st Jan 2021.

Benefits for self employed people have been increased to bring them into line with statutory sick pay – as ‘enjoyed’ by PAYE employees. This will equate to approximately £97 per week.

If you need coronavirus small business help then don’t suffer in silence. Get in touch.