Between Spring Budget 2020 on 11 March and Friday 20 March the Government announced a series of measures designed to counter the threat posed to the UK economy by the outbreak of the coronavirus that causes the respiratory disease COVID-19.
This post summarises all measures so far announced and provides up-to-date information on how you can:
- find out more about each measure from reliable sources and
- find information to access the support on offer.
It will be updated at least daily as new information emerges on eligibility and how businesses can access each service or fund.
Measures announced on 20 March
On the evening of 20.03.2020 the Prime Minister announced further restrictions on the compulsory closure of bars, cafes, pubs and restaurants.
Alongside these new measures, the Chancellor announced a further package of support for businesses facing the prospect of having to reduce staff numbers.
Coronavirus job retention scheme
- Grants of up to £2,500 per employee where those employees are unable to work (are ‘furloughed’) because of coronavirus, covering 80% of salary costs.
Intended to run for three months in the first instance with the first payments expected in early April and the scheme fully up and running by the end of that month.
- The grants will be paid via HMRC.
- All UK employers will be eligible.
- What next? At present, no information has been provided on how to apply. Though it is generally understood to mean ‘stood down but still employed’, there is as yet no official definition of ‘furloughed’. It is unclear whether employers will be expected to make up the remaining 20% of salary.
Extension of the coronavirus business interruption loan scheme (CBIL)
- Maximum turnover for eligible businesses was previously set at £41 million per year; it has now been increased to £45m.
- The interest-free period has been increased from six months to twelve.
- The scheme is being managed by the British Business Bank but businesses will access them via one of 40 accredited lending providers, including most major banks.
- The maximum value of a facility provided under the scheme will be £5 million – higher than the £1.2m announced initially.
- What next? Discuss business plans with existing lending providers. Loans will be available from Monday 23 March 2020.
Deferral of tax and VAT payments currently due
- VAT payments from UK-based VAT registered businesses due between 20 March and 30 June 2020 won’t need to be paid to the usual deadlines, with payment deferred until the end of the tax year.
- Self-assessment income tax payments for the self employed which were due on 31 July 2020 can now be deferred until 31 January 2021.
- What next? Both deferral schemes apply automatically with no application required.
Access to welfare for the self-employed
- The minimum income floor for access to universal credit has been suspended for self-employed people affected by the economic impact of coronavirus.
Measures announced on 17 March
At a press conference on 17 March, the Chancellor announced a package of support worth £350 billion – around 15% of the value of the entire UK economy.
It came upon the heels of a statement from the Prime Minister on 16 March which urged people to stop visiting cafes, pubs and restaurants.
It was intended to send a strong signal to British businesses not to act hastily in downsizing because support would be forthcoming.
Extension of business rate discount
- All hospitality, leisure and retail venues in England, regardless of rateable value, can now claim a 100% discount on business rates for 12 months from 1 April 2020 to 31 March 2021.
- Unoccupied properties that become vacant in the next 12 months will be charged 100% full rates from three months after they become empty.
- What next? The discount will be applied automatically to the next council tax bill, due in April 2020.
Cash grants for very small businesses
- Hospitality, leisure and retail businesses operating from units with rateable values between £15,000 and £51,000 will receive a grant of £25,000.
- Businesses in these sectors with a rateable value of less than £15,000 will receive a grant of £10,000.
- Those with a rateable value of more than £15,000 will receive £25,000.
- Your local authority will contact you if you are eligible for this grant.
- What next? Await notification from local authorities.
Measures announced in Spring Budget 2020
In what the Office for Budget Responsibility called the “largest Budget giveaway since 1992”, Rishi Sunak announced business support measures worth billions. Events have moved quickly, though, and many of the specific measures announced have now been superceded or further extended.
Grants for businesses receiving SBRR or RRR
- Businesses in England eligible for small business rate relief (SBRR) or rural rate relief (RRR) will receive a one-off cash grant of £10,000.
- What next? This will be processed automatically by local authorities.
Statutory sick pay reclaim scheme for SMEs
- Small-and medium-sized businesses and employers will be able to reclaim statutory sick pay (SSP) paid for sickness absence due to COVID-19.
- The refund will cover up to two weeks’ SSP for each member of staff off work because of COVID-19.
- It applies to all UK businesses that employed fewer than 250 employees as of 28 February 2020.
- What next? Legislation needs to pass before details of how to apply can be published.
- On 19 March 2020 the Bank of England cut interest rates to a historic low of 0.1%, having previously reduced them to 0.25% on the day of the Spring Budget.
- COVID-19: support for businesses | HM Government
- Coronavirus Business Interruption Loan Scheme (CBILS) | British Business Bank
- Supporting your workforce during the coronavirus | HRZone