Duncan & Toplis, Chartered Accountants & Business Advisers, are producing a daily bulletin of the latest news to provide general support for businesses. The page can be accessed here:

Coronavirus: General support for businesses

 

Updated 25.03.20: The UK Government has responded to the virus with a series of measures which are designed to support and sustain businesses and their employees through this difficult time and more support is expected in the coming days and weeks.

We’ve pulled together a summary of the measures and details that have been announced so far, including eligibility, which we hope is helpful.

You can find our full, regularly updated list of measures to support businesses throughout the coronavirus pandemic here.

Please note, the information below is correct as of Wednesday 25 March 2020 but may be subject to change.

COVID-19 Business Support Update: Wednesday 25 March

Support for businesses through the Coronavirus Job Retention Scheme

 

• Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

 

Eligibility – all UK businesses are eligible.

 

How to access – There are some steps you will need to follow. Firstly, to designate affected employees as ‘furloughed workers,’ and notify your employees of the change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.

 

• You will need to submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required).
• HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.
• The CBILS scheme (see below) may be useful to cover short-term cash flow gaps until you access the job retention scheme.
• Our current understanding is that directors will be able to use this scheme, but this will not cover dividend payments. Please note that this has not been confirmed yet.
• We are anticipating a further support package for the self-employed.
• Duncan & Toplis are fully utilising their internal Human Resource expertise to provide further support. Please let us know if you have specific queries. We are here to help.
• For example, our HR team have researched the existing law surrounding furloughed employees. Please see HERE for this advice.

Support for businesses through deferring VAT and Income Tax Payments

 

• The government will support businesses by deferring Valued Added Tax (VAT) payments for 3 months.
• If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.
• VAT – For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.

 

VAT Eligibility – All UK businesses are eligible.

 

VAT How to access – This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.

 

• It is understood that VAT returns are still expected to be submitted on time.
• If you still wish to make your payment, you can do.
• Income tax – For the self-employed. For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.

 

Eligibility – If you are self-employed you are eligible.

 

How to access – This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.

 

• Please also see below for the scaled-up Time to Pay Offer from HMRC. Duncan & Toplis are here to help with communication with HMRC.
• If you have a direct debit in place for either of the above, we recommend that you cancel to ensure that payment Is not taken.

Support for businesses paying sick pay to employees

 

• Legislation has been brought forward to allow small and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
• This refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19.
• Employers with fewer than 250 employees will be eligible – the size of an employer will be determined by the number of people they employed as of 28 February 2020.
• Employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19.
• Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note.
• If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website.
• Eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to those staying at home comes into force.
• The reimbursement of SSP is expected to be net of tax. Business will therefore still pay the tax cost of paying statutory sick pay.

 

Eligibility – Your business must be UK based and your business is small or medium-sized and employs fewer than 250 employees as of 28 February 2020.

 

How to access – The government is developing a rebate scheme. Further details will be provided in due course once the legislation has passed.

Support for those ineligible for SSP

 

• ‘New style’ Employment and Support Allowance will be payable for people directly affected by COVID-19 or self-isolating according to government advice for from the first day of sickness, rather than the eighth day.
• People will be able to claim Universal Credit and access advance payments where they are directly affected by COVID-19 (or self-isolating), without the current requirement to attend a jobcentre.
• For the duration of the outbreak, the requirements of the minimum income floor in Universal Credit will be temporarily relaxed for those directly affected by COVID-19 or self-isolating according to government advice for duration of the outbreak, ensuring self‑employed claimants will be compensated for losses in income.

Support for retail, hospitality and leisure businesses who pay business rates

 

• A business rates retail holiday has been introduced for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
• Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.

 

Eligibility – Your business must be based in England and your business must be in the retail, hospitality and/or leisure sector. Specifically, your property must be wholly or main being used as shops, restaurants, cafes, drinking establishments, cinemas and live music venues, for assembly and leisure or as hotels, guest & boarding premises and self-catering accommodation.

 

How to access – There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

 

• An estimate of the charge you will no longer have to pay can be found at https://www.gov.uk/calculate-your-business-rates.
• Guidance for local authorities on the business rates holiday has been published. If interested it can be found at https://www.gov.uk/government/publications/business-rates-retail-discount-guidance.
• Any enquiries on eligibility for, or provision of, the reliefs and grants (see below) should be directed to the relevant local authority.

Cash grants for retail, hospitality and leisure businesses

 

• The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.
• For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000.
• For businesses in these sectors with a rateable value of between £15,001 and £51,000, they will receive a grant of £25,000.
• Please ensure that your local authority has the required details to make payments to you. If not, we are seeing that local authorities are issuing forms to provide this information to ensure that swift payments are made.

 

Eligibility – Businesses are eligible if your business is based in England and is in the retail, hospitality and/or leisure sector.

 

This includes property that are wholly or mainly used as shops, restaurants, cafes, drinking establishments, cinemas and live music venues. Those being used as hotels and boarding premises and self-catering accommodation.

 

How to access – You do not need to do anything, other than ensuring your local authority has the information required to make payment to you.

 

• If the cash flow need is urgent, it would be advisable to contact your bank to see if a short-term arrangement can be reached until the funding is received.
• Detailed guidance has now been issued by the government at https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/874772/small-business-grant-fund-and-retail-guidance.pdf

Support for nursery businesses that pay business rates.

 

• There will be a business rates holiday for nurseries in England for the 2020 to 2021 tax year.

 

Eligibility – the property must be based in England.

 

• This includes businesses on the Ofsted early Years Register and used wholly or mainly for the provision of the Early Years Foundation Stage.

 

How to access – No action is required. This will apply to your next council tax bill in April 2020.

Support for businesses that pay little or no business rates

 

• The government will provide additional funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR). This will provide a one-off grant of £10,000 to businesses currently eligible for SBRR or rural rate relief, to help meet their ongoing business costs.
• If your business is eligible for SBRR or rural rate relief, you will be contacted by your local authority – you do not need to apply.
• You do not need to do anything, other than to ensure that the local authority has the information required to make payments to you. Funding for the scheme will be provided to local authorities by government in early April. Guidance for local authorities on the scheme will be provided shortly.

Support for businesses through the Coronavirus Business Interruption Loan Scheme (CBILS)

 

• A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank through the main/secondary banks, launched on 23 March to support businesses to access bank lending and overdrafts.
• The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs.
• The government will not charge businesses or banks for this guarantee, and the scheme will support loans of up to £5 million in value.
• Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments.
• The scheme will take the place of the Enterprise Finance Guarantee (EFG). A range of options will be available through CBILS including business loans and asset finance (terms up to 6 years) overdrafts and invoice finance and revolving facilities (terms up to 3 years).
• From experience, there will be a process to follow and businesses need to be ready to make early applications.
• There will be an underwriting process, so businesses should ensure that their financial information is as up to date as possible.
• It is key that businesses are finance ready, by preparing in detail for application.
• The following is an example of the information/questions requested by a bank to process an application. Of course, Duncan & Toplis are here to help you with your application:
  • Full background of the business and the level of impact the coronavirus is having on the performance of your business.
  • The measures being taken by you to ensure there’s adequate cash flow in the business. What contingencies have been put in place with suppliers etc.?
  • What is the business doing to manage expenditure?
  • What additional funding you may require and for how long.
  • Term/structure required (number of months payment holiday required, is it a full holiday or reduced payments. For example, 50%, do you wish to extend the agreement by the number of payments in the holiday or spread over the remainder of the agreement?
  • Other HP or lenders’ positions. Are we the only funder? If not have you approached the other funders and what has been agreed?
  • What other funding options do you have in place? i.e. overdraft options? Formal HP lines
  • Please can you make available; Latest year end accounts, management information, forecasts and a clear understanding of ongoing fixed costs.
• It is understood that, at the discretion of the lender, the scheme may be used for unsecured lending for facilities of £250,000 and under. For facilities above £250,000, the scheme requires the lender to establish a lack or absence of security prior to businesses using CBILS.

 

Eligibility – Your business must be UK based. CBILS is aimed at smaller UK business. Therefore, it is limited to companies with an annual turnover not exceeding £45m and those without adequate security to obtain funding from the lender under ordinary circumstances and must meet the other British Business Bank eligibility criteria.

 

How to access – The full rules of the Scheme and the list of accredited lenders is available at https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/.

 

• All the major banks will offer the Scheme once it has been launched. There are 40 accredited providers in total. You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments, you may want to ask for a repayment holiday to help with cash flow.
• You also consider going to market with applications for CBILS. Please contact us to see how we can help with this.
• The scheme will be available from early next week commencing 23 March. Please see https://www.gov.uk/government/news/coronavirus-business-support-to-launch-from-today
• We will release further details as they become available.

Support for larger firms through the COVID-19 Corporate Financing Facility

 

• Under the new Covid-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies.
• This will support your company if it has been affected by a short-term funding squeeze and allow you to finance your short-term liabilities.
• It will also support corporate finance markets overall and ease the supply of credit to all firms.

 

Eligibility – All UK businesses are eligible.

 

How to access – The scheme will be available early in the week beginning 23 March 2020. The government will provide information on how to access the scheme shortly.

 

• More information is available from the Bank of England at https://www.bankofengland.co.uk/markets/market-notices/2020/ccff-market-notice-march-2020.

Support for businesses paying tax

 

• All businesses and self-employed people in financial distress and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
• These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. This is normally only available to those in significant financial distress.
• There is currently no confirmation from HMRC or government that tax filing deadlines will be relaxed. Business should try to meet tax compliance obligations to avoid penalties being assessed by HMRC.
• HMRC may be open to deferral of month 11 (March 2020) PAYE payments for 2 months, subject to specific agreement with HMRC.
• We have already had several success stories of Duncan & Toplis clients being able to defer tax payments. HMRC are supporting this.

 

Eligibility – You are eligible if you pay tax to the UK government and have outstanding tax liabilities.

 

How to access – If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.

 

• If you’re worried about a future payment, please call nearer the time.

Insurance

 

• Businesses that have cover for both pandemics and government-ordered closure should be covered, as the government and insurance industry confirmed on 17 March 2020 that advice to avoid pubs, theatres etc is sufficient to make a claim.
• Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers. Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.
• As of 24 March the government released further details relating to insurance claims covering notifiable disease policies, unspecified notifiable disease policies, government ordered closures and event coverage.

Permission for pubs and restaurants to operate as takeaways

 

• Communities Secretary has confirmed that the government will set out measures so that pubs and restaurants can operate as hot food takeaways to serve people having to stay at home.
• Relaxation of planning measures will be introduced as soon as possible and will apply for a limited period.
• Currently planning permission is required for businesses to carry out this change.
• This does not impact alcohol licensing rules.

Mortgages

 

• Mortgage lenders will offer at least a 3-month mortgage holiday for those borrowers in difficulty due to COVID-19.

IR35 delay

 

• The government is delaying the new private sector IR35 regime until 1 April 2021.

Guidance for the Charity Sector

 

• On 23 March, the government updated their general advice to the charity sector. This advice can be seen at https://www.gov.uk/government/news/coronavirus-covid-19-guidance-for-the-charity-sector.

Key Workers

 

• It has been confirmed that food processing worker WILL be classed as key workers. Therefore, their children will be eligible for childcare.
• It is also understood that only one parent of a child needs to be a key worker for that child to still be able to receive child care.
• Full government guidance can be found at https://www.gov.uk/government/publications/coronavirus-covid-19-maintaining-educational-provision.

Companies House Filing

 

• Businesses affected by the pandemic can now apply to Companies House to request an extension to file their accounts, reports and confirmation statements.
• The rules surrounding the application process for accounts submission have been relaxed as of 25 March.
• Businesses will be given an additional 3 months to file accounts with Companies House to avoid penalties as they deal with the impact of COVID-19.
• Companies will have to apply for the 3-month extension to be granted, but those citing issues around COVID-19 will be automatically and immediately granted an extension.
• Application can be made through a fast-tracked online system which will take just 15 minutes to complete.
• If you do not apply a filing penalty will be issued.
• The fast-track application process can be found at https://beta.companieshouse.gov.uk/extensions?_ga=2.231358486.886983296.1584948320-2120154938.1578658642
• If you need help to complete this form please let your contact at Duncan & Toplis know. We are here to help.

Government plans for enforced closure of businesses and other venues

 

• Businesses who do not follow COVID-19 restrictions will be issued with prohibition notices.
• Businesses who fail to comply will receive fines and could also face the loss of their alcohol license.
• There will be no upper limit to the fines of businesses who continue to ignore restrictions.
• Local government will be responsible for enforcing regulations requiring those businesses to close on 20 March 2020.
• Environmental Health and Trading Standards officers, with support from the police if appropriate will work together to issues prohibition notices where restrictions are not followed.
• The full guidance is available at https://www.gov.uk/government/publications/business-and-other-venues-subject-to-further-social-distancing-measures.

Extra protection for businesses with ban for commercial tenants who miss rent payments

 

• Commercial tenants who cannot pay their rent because of coronavirus will be protected from eviction.
• These measures will mean no business will automatically forfeit their lease and be forced out of their premises if they miss a payment up until 30 June. This may be extended by the government.
• This is not a rental holiday and tenants will still be liable for the rent.
• All commercial tenants in England, Wales and Northern Ireland are eligible.
• No application is required, this will come into force when the Coronavirus Bill received Royal assent.

Support for businesses across the UK

 

• Please note that some elements of business support are devolved and therefore support may differ in Scotland, Northern Ireland and Wales.

Support for the self-employed – Statutory self-employment pay

 

• Yesterday, the coronavirus bill was amended to include provisions for support for the self-employed. It must be stressed that this has not been enacted so far and therefore subject to change.
• The amendment covers the self-employed and freelancers.
• The payments are to be set so that net monthly earnings of an individual do no fall below 80% of monthly net earnings, averaged over the last 3 years, or £2,917, whichever is the lower.
• No payment shall exceed £2,917.
• This will be a much-welcomed amendment for millions of people.

Employers do not have to report gender pay gaps

 

• Enforcement of the gender pay gap reporting deadlines suspended for this year.

Extension of Business Improvement Districts (BIDs) arrangements

 

• BIDs will be able to extend the maximum duration of their BID arrangements until 31 March 2021 by delaying BID ballots.
• This enables them to focus on the response to the current emergency.