Government pledges support for businesses to combat COVID-19 disruption

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In recent days, the Government has announced a raft of measures to support businesses through the disruption caused by COVID-19. Here’s a quick summary of what will be available:

A 12-month business rates holiday for all retail, hospitality and leisure businesses in England

    • A business rates retail holiday 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.

Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief

    • Government will provide additional funding for local authorities to support small business that already pay little or no business rates because of small business rate relief (SBBR).
    • This is a one-off grant of £10,000 to businesses currently eligible for SBRR or rural rate relief.
    • Local Authorities will contact eligible businesses automatically – businesses do not need to apply.
    • Funding will be provided in early April.

Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000

    • £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a ratable value between £15,000 and £51,000.
    • Eligibility / provision of this relief is by applying to the relevant local authority.

The Coronavirus Business Interruption Loan Scheme to support long-term viable businesses who may need to respond to cash-flow pressures by seeking additional finance

    • A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch next week to support primarily small and medium sized 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).
    • 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 6 months of that finance interest free, as government will cover the first 6 months of interest payments.
    • Further details, including on the lenders providing access to this scheme will be announced in the coming days, and the scheme will be available from early week commencing 23 March 2020.

Corporate Financing Facility for larger firms

    • The Bank of England has announced a new lending facility to raise working capital via the purchase of short-term debt.
    • Further details, including on how to access this funding will follow in the coming days, and the scheme will be available from the week commencing 23 March

The HMRC Time To Pay Scheme to help with 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.
    • Contact HMRC.

Statutory Sick Pay Relief package for SMEs

    • legislation will be brought forward to allow SME to reclaim statutory sick pay paid for sickness absence due to COVID-19. There are eligibility criteria for this scheme:
      • 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
      • 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 government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible.