Business Support Available to SMEs
Latest update: 18th December 2020
The government has unveiled an unprecedented support package to help businesses through the COVID-19 crisis. The support available is evolving to meet the needs of UK businesses throughout the different stages of the pandemic.
We have summarised below the help that is available to SMEs and where the information is available, we also confirm how you can access this help. We will keep this page updated as the government announces further information.
Refund of Statutory Sick Pay (SSP)
In circumstances where an employee is absent from work due to coronavirus or has to self-isolate in line with government guidance, Statutory Sick Pay will be payable from day one of absence rather than day four. SSP remains at £95.85 per week.
SSP is ordinarily a cost to the employer, however the government has confirmed that it will repay up to two weeks SSP for each employee that takes time off due to coronavirus.
Will my business qualify for a Refund of SSP?
You will be able to reclaim the costs of up to two weeks sick pay per employee provided you are a small or medium sized business with no more than 250 employees at 28th February 2020 and your business is based in the UK.
How do I claim this?
The online portal to facilitate these claims opened on 26th May 2020. You can access this here
What if I do not qualify for SSP?
If you are not an employee of the business, or you pay yourself a salary below £118 per week you will not be eligible for SSP, however you are able to claim Employment Support Allowance or Universal Credit. This is claimed directly from the government and further information is available here.
Deferral of VAT payments
From 20th March to 30th June, you were not required to make payment of your VAT return, although it needed to be submitted to HMRC as usual. This means that for the quarters ending 29/02/2020, 31/03/2020 and 30/04/2020 no VAT payments needed to be made.
Initially, any deferred VAT needed to be paid in full by 31st March 2021, however due to the ongoing impact of the coronavirus the Chancellor announced that businesses that deferred their VAT will now have the option to pay in smaller instalments over 12 months, the final balance being paid in full by March 2022. You will need to opt into this scheme. If you can afford to pay your deferred VAT by 31st March 2021, you should consider doing so.
How can I claim this?
You can opt to pay in instalments to spread the deferred VAT over 12 months. We will update this page when we have information on how to do this.
The Coronavirus Job Retention Scheme (CJRS)
The government announced the Coronavirus Job Retention Scheme to help businesses to continue paying employees that otherwise may have been laid off. Under this scheme, businesses can access grants of up to 80% of their employees’ wages up to a total of £2,500 per month per furloughed employee.
To access this scheme, businesses need to designate their workers as ‘furloughed employees’. A furloughed employee is an employee that remains on the payroll but is not working due to the coronavirus outbreak. From 1st July the government introduced flexible furloughing, which allows part time furlough depending upon your workloads. This could see you or your employees return to work a few days a week and continue to be furloughed for the remainder of the week, this could be useful for contractors who may be offered a tapered return to the office.
For the time furloughed, your employees cannot do any work that makes money or provides services to the business. The government has confirmed that company directors can be furloughed and continue to complete their statutory filing obligations.
The scheme has been subject to many changes and variations and on 17th December the scheme was once again extended. The CJRS will now end on 30th April 2021. The scheme from 1st November 2020 to 30th April 2021 will operate in largely the same way as it did in August 2020..
To make a claim under the extended CJRS the employee you wish to make a claim for, must have been on your company’s PAYE payroll on 30th October 2020. You must have made at least one PAYE Real Time Information (RTI) submission to HMRC for the person you wish to make a claim for between the 20 March 2020 and 30 October 2020.
From 1st November 2020 until 30th April 2021 the grant available will remain at 80% of the wage costs of the furloughed employee or director up to a maximum of £2,500 per month. The business will need to bear the cost of any Employers NI, apprentice levy and auto-enrolment pension costs if applicable. Holiday pay will accrue as usual for the period the employee is on furlough.
It is important to note that this scheme will only cover salary. If you are a company director and receive dividends this will not be included in the calculation of the grant.
How do I claim this?
The portal to facilitate claims for the extended period from 1st November 2020 is now open.
As previously your accountant will be able to make the claims on your behalf, provided they are authorised as your agent. If you wish to make the claim yourself, you will need a PAYE online account.
You will also need to calculate the amount of the claim yourself and you should keep a record of how this was calculated. HMRC have been clear that they will be investigating claims made under the CJRS and it is essential you keep all records that relate to the claim for 5 years.
All claims for furlough periods from 1 July 2020 to 31 October 2020 must be submitted no later than 30 November 2020.
Claims from 1 November 2020 must be submitted by 11.59pm 14 calendar days after the month you’re claiming for. If this time falls on the weekend, then claims should be submitted on the next working day.
|Claim for furlough days in||Claim must be submitted by|
|November 2020||14 December 2020|
|December 2020||14 January 2021|
|January 2021||15 February 2021|
|February 2021||15 March 2021|
|March 2021||14 April 2021|
|April 2021||14 May 2021|
You can find the full guidance on the extended CJRS here.
Your company name and details of any claim will be published
HMRC will be publishing the company name, company registration number and an indication of the value of the claim within a banded range for all businesses that have made a claim under the CJRS from December 2020 onwards, however these details will not be published until February 2021. If you believe that the publication of this information would result in a serious risk of violence or intimidation, you can request that HMRC do not publish this. Further details on how to do this will be released shortly.
Claims made from 1st December will also be visible in the Personal Tax Account of any employees/directors for which a claim has been made.
You cannot claim for any days on or after 1 December 2020 during which the furloughed employee was serving a contractual or statutory notice period for the employer (this includes people serving notice of retirement or resignation). If you make an employee redundant, you should base statutory redundancy and statutory notice pay on their normal wage rather than the reduced furlough wage.
Coronavirus Business Interruption Loan Scheme (CBILS)
The Coronavirus Business Interruption Loan Scheme is being implemented to encourage finance providers to continue lending to small and medium sized businesses amidst the crisis. The government will provide lenders with a guarantee of 80% on each loan and will support loans of up to £5 million. The government will pay interest and any fees for the first 12 months.
Can I claim this?
- All UK businesses with a turnover of less than £45 million per year can apply for finance through this scheme
- Further eligibility criteria can be found here
- The application deadline has been extended to 31st March 2021
How can I claim the CBILS?
All the major banks will be able to offer the scheme so you should speak to your existing bank as soon as possible. Further details of the scheme and a list of lenders is available here.
Bounce Back Loan Scheme (BBLS)
The Bounce Back Loan Scheme is designed to help small and medium sized businesses to access finance. The scheme gives the lender a 100% government-backed guarantee and lenders are not allowed to request personal guarantees. This support from the government should mean lenders are more willing to offer help after growing pressure from small businesses about the difficulty in accessing finance.
An accredited lender can provide a loan from £2,000 up to 25% of a business’ turnover over a maximum term of 6 years. The maximum loan amount is £50,000.
The government will pay the first year’s interest payments and there are no repayments due from the customer for the first year of the loan. The interest rate is fixed at 2.5% for the term of the loan and there will be no early repayment penalties charged.
The loan is open for applications until 31st March 2021 and if you already have a Bounce Back Loan but borrowed less than you were entitled to, from 10th November you can top up your existing loan to your maximum amount. You can find more information about how to access the scheme and a list of accredited lenders here.
Can I claim the Bounce Back Loan?
To be eligible to apply for this loan you must:
- be a UK business established before 1st March 2020
- have been adversely affected by coronavirus
You cannot apply if you are already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS), however you can transfer your balance from the CBILS to the Bounce Back Loan Scheme if you wish.
How can I claim this?
This scheme is provided through a network of accredited lenders and you will need to approach them directly online to apply for the loan. You can find the full list of accredited lenders here.
The Local Restrictions Support Grant – LRSG (Closed) Addendum
The LRSG (Closed) Addendum is intended to support businesses that were open as usual but were required to close between 5th November and 2nd December due to the national lockdown in England.
You may be able to apply for a grant of up to £3,000 per month if you meet the following eligibility criteria:
- Your business is based in England
- Your business occupies property on which it pays business rates (and is the ratepayer)
- Your business has been required to close because of the national restrictions from 5th November to 2nd December 2020
- Your business has been unable to provide its usual in-person customer service from its premises
You can find out more information on the grant here.
Extension to Companies House filing deadline
Businesses impacted by coronavirus can apply for an extension to their accounts filing deadline of up to three months. You will need to apply for this. However, Companies House have confirmed that those citing issues around COVID-19 will be automatically and immediately granted an extension. Applications can be made through a fast-tracked online system which will take just 15 minutes to complete. Further information on applying for an extension can be found here.
Time to pay
A helpline has also been set up to help those who are unable to pay their tax bills to discuss Time to Pay support. If you believe you will be unable to pay a tax liability due to COVID-19 you can contact HMRC on 0800 0159 559.
Deferral of self-assessment payments
The government announced that any Self-Assessment payments on account previously due to be paid on 31st July 2020 will be deferred until 31st January 2021.
A further announcement in October confirmed that taxpayers unable to pay their self-assessment tax liability, including any deferred payments on account on 31st January 2021 can pay in instalments by entering into a ‘Time to Pay’ arrangement with HMRC.
You must still file your Self-Assessment Tax Return before the deadline, and you will need to wait at least 48 hours after filing the return before you can set up your Time to Pay arrangement.
As interest is payable on Time to Pay arrangements, you may still wish to pay your tax liability in full by 31st January 2021 if you can afford to do so.
Am I eligible?
If you are struggling to pay your Self-Assessment tax liability due on 31st January 2021, including any deferred payment on account, you can enter into a Time to Pay arrangement with HMRC.
How do I claim this?
You must still submit your Self-Assessment Tax Return by 31st January 2021.
Once you have done this you will need to wait 48 hours before you can apply. If the total amount you owe is less than £30,000 you can apply online using your government gateway account. If the amount you owe is more than £30,000 you will need to call the Self-Assessment payment helpline on 0300 200 3822.
Self-employed Income Support Scheme (SEISS)
The Self-Employment Income Support Scheme (SEISS) was introduced to support self-employed individuals (unincorporated business and members of partnerships) who have lost income due to coronavirus (COVID-19).
This scheme allows the self-employed to apply for grant of 80% of their average profits up to a maximum of £7,500 covering three months’ worth of profits. To calculate your average income, HMRC will look at your last three tax returns. If you have not traded for three years HMRC will take the average of the tax returns you have submitted.
To be eligible for the scheme you must have taxable profits of less than £50,000, make most of your income from self-employment and have filed a 2018/19 tax return.
On 5th November 2020, the Chancellor announced a further Self-Employment Income Support Scheme grant extension in the form of 2 further grants, each available for 3-month periods covering November 2020 to January 2021 and February 2021 to April 2021.
Self-employed individuals can access the extended scheme if they were eligible for the SEISS first and second grant (although they do not need to have claimed) and they intend to continue to trade.
It is important to note that this is a taxable grant and is treated as income for the purposes of your tax return. You must make provision for tax and National Insurance payments on this grant.
The government has been clear that this scheme will not be open to those workers operating through their own limited company. Instead, these workers need to consider if they are eligible for a grant under the Coronavirus Job Retention Scheme.
With you all the way
If you would like to discuss the above further, please get in contact with your accountant who will be happy to offer support. Please be aware that due to the current circumstances your accountant will be working from home. Please email in the first instance and they can arrange a time to call you.
We will be making updates to these pages as and when there are further announcements from the government.
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