COVID-19 – information on financial aid
I hope you are all continuing to stay safe.
Over the last week, daily updates have been announced and details regarding the various strategies implemented by the government to help businesses and individuals impacted by the Coronavirus financially. It has been difficult knowing just when to provide our clients with an update as things have and continue to change on a daily basis.
I, therefore, direct you to this government site which provides a really useful guide on the different financial aids offered which I hope you will find useful in digesting what may be applicable to you. This is also updated regularly.
I outline some of the main grants and subsidies for businesses and individuals below:
Businesses
- VAT registered businesses can postpone VAT payments due between 20 March and 30 June until March 2021. Submissions must still be made on time. Please cancel Direct Debit mandates if necessary.
- Businesses in receipt of small business rates relief and rural relief will be eligible for £10,000 grant. This is issued by each local authority who will be writing directly to applicable businesses in the coming days with advice on how to claim this grant.
- Businesses under the retail, hospitality and leisure in receipt of the expanded retail discount with a rateable value less than £51,000 will be eligible for: rateable value up to £15,000 – eligible for £10,000 grant. A rateable value between £15,000 and £51,000 – eligible for £25,000 grant. These businesses will also receive a business rates holiday for 12 months. This is issued by each local authority who will be writing directly to applicable businesses in the coming days with advice on how to claim this grant.
- Time to pay service – If you have outstanding tax to pay, you may be eligible to receive support with tax affairs through HMRC’s Time to Pay Scheme. These are agreed on a case-by-case basis. If you have missed or might miss a tax payment, please call HMRC’s dedicated helpline 0800 0159 559
Details of all the above can be found here.mor
Running a Payroll Scheme (Company or Sole Trader)
- Statutory Sick pay can now be paid to an employee from the 1st day of sick leave for up to 2 weeks. This will be reimbursed by the government through a new portal currently being built. Time-frame for reimbursement not yet announced.
- Job retention scheme – Employers may furlough any employee registered on PAYE as at 28 February 2020. Employers may furlough an employee from 1st March. Furloughed employees must be furloughed for a minimum of 3 weeks. Furloughing can include directors of businesses affected by Coronavirus. Employers can use a portal to claim 80% of furloughed employees usual monthly wage costs up to £2,500 a month plus the associated employer national insurance contributions and minimum automatic enrolment employer pension contributions. It is understood the February pay figure will be used or the average across the last 12 months. No work can be undertaken by any employee furloughed. (This includes directors other than legal administrative duties undertaken of running an LTD company). This portal is currently being built and estimated to be available from the end of April. Find more payroll details here.
Sole Traders
- The self-employed income support scheme (SEISS) will support self-employed individuals (incl. partnerships) who have lost income due to COVID-19. It will allow you to claim a taxable grant worth 80% of your trading profits (averaged over 3 years or a number of years if trade if lower than 3 years) up to a maximum of £2,500 per month for the next 3 months (may be extended). You must have submitted a 2019 return to be eligible with profits below £50,000 and profits make up more than 50% of total income. HMRC are currently are building the portal. We will notify clients when this is live so they are able to begin the application. We believe payments will be made as a lump sum in June. We encourage you to look at Income support allowance and Universal credit to help with cash flow in the mean-time.
- Sole traders may also be eligible for the business interruption loan if needed.
- SEISS details
Details of all the above can be found here.
Individuals
- If you have a personal tax interim payment due in July 2020, this will automatically be postponed until January 2021. You may of course still pay before if you prefer.
- Look at your outgoings – can anything be paused such as taking advantage of the widely available 3 month mortgage holiday. Please speak to you mortgage provider regarding this. Subscription services such as Sky Sports are offering customers a pause on their subscription. Take a look at what is available, and speak with your providers.
Further to the details of grants and subsidies outlined below, we fully recommend taking a look at the employment support allowance and Universal Credit websites to see if you qualify for income from either or both of these two state aids if necessary. Since Coronavirus, minimum income floors have been removed and certain thresholds changed, so you may well now be eligible or eligible for greater aid if you are already in receipt. This can help with cash flow in the interim between receiving any further potential grants/subsidies which may be paid out at a later date.
Employment and Support Allowance
I really hope you find the above useful. If you do have any queries, please do not hesitate to contact us.
We will, of course, continue to keep you updated on new developments and once these new portals go live.
Stay safe.