The Coronavirus outbreak continues to cause massive economic uncertainty to our industry, and the below are some guidance notes as to the various government schemes available for businesses.
Job Retention Scheme
HMRC will support your business by paying 80% of each of your employees’ salary who would have been laid off during the crisis at the maximum of £2,500.
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You have one employee earning £2,000 a month, so you will be able to claim 80% of this which is £1,600.
If you have a second employee earning £3,500 per month then 80% would be £2,800 however this would be capped at £2,500.
The scheme will initially last for 3 months, and you can backdate claims from the 1st March 2020.
All UK businesses regardless of size will be eligible for this scheme.
Firstly, you will need to designate any of your affected employees as furloughed workers and then you will need to notify your employee of this. Secondly, you will need to make the claim through HMRC’s portal, which is expected to be online from 20th April 2020.
Statutory Sick Pay (SSP)
Statutory sick pay is currently £94.25 per week. If you have had employees on sick due to COVID-19 then you will be refunded the first 2 weeks of statutory sick pay paid to your employee.
The relief will be available to UK businesses with fewer than 250 employees as at 28th Feb 2020.
As an employer, you should maintain records of staff absences and payments of SSP made.
Currently, the rebate scheme is being developed.
Deferring VAT
Any VAT liabilities accumulated between 20th March 2020 until 30th June 2020 will not need to be paid over to HMRC until the 5th April 2021. This scheme is intended to help you strengthen your cash flow which is vital during this crisis.
Please note that this is a deferral and not a relief. So eventually, this vat liability will need to be paid to HMRC. No penalties or interest for late payment will be charged in the deferral period.
All UK businesses are eligible for this deferral. The scheme is automatic, you do not have to apply for this scheme to HMRC.
Business Rates
A business rates holiday period will come into effect for the tax year 2020 to 2021 for those businesses in the retail, hospitality and leisure business.
You do not need to take any action on this. This will automatically apply to your next council tax bill in April 2020.
Cash Grant
This scheme is a cash grant of £25,000 available to businesses in the retail, hospitality and leisure sectors who have a rateable value between £15,001 and £51,000. If you are within this sector but your rateable value is less than £15,001 a year, then you will receive a grant of £10,000.
You do not need to do anything to access this grant. Your local authority will write to you if you are eligible for this grant.
Interruption Loan Scheme
A temporary loan scheme is now available to support small and medium sized businesses. As a business you will be able to access as 12-month interest free loan, as the government will cover your first 12 months interest. The scheme will support loans of up to £5 million in value.
You will be eligible if your turnover is no more than £45 million per year and your business meets the other British Business Bank eligibility criteria.
There are 40 accredited providers of the scheme and all major banks will be offering the loan once the scheme is launched.
Your next move is to talk to your bank as soon as possible and discuss your business plan with them.