Coronavirus: Update on Support available for Businesses

Following further announcements on Monday this week from the Government, we have sifted through these and provide you with a summary of the latest developments for business and support available. We expect this will evolve further in the coming days/weeks.

Financial Support
Business interruption loan scheme – we are told this will be available from next week; we cannot find anywhere online as yet you can apply for these at the time of writing this.

These will be provided by banks but guaranteed by the Government. More than 40 lenders are taking part including high street names like; Barclays, HSBC, Lloyds and many more.

We’re told there will be no interest on these loans for the first 6 months.

Many banks will have dedicated helplines/support pages for business owners affected by the virus, here are a few we have found so far:
Barclays: 0800 1971 086
HSBC: 03457 404 404 www.hsbc.co.uk/help/coronavirus
Lloyds: www.lloydsbank.com/business/coronavirus
Santander: 0800 731 6666
Natwest: 0345 711 4477

Please note: the small business borrower will always remain 100% liable for the debt and the money will need to be repaid eventually. So exercise caution on taking out a loan if the business already has significant debts. We urge you to talk to us before you consider taking on new finance; it must be affordable for the business once we move forward after the crisis.

Individuals struggling with mortgage repayments
If this is as a result of the virus impact, lenders should be able to provide a 3 month repayment holiday. To set this up, we recommend calling your mortgage lender as soon as possible.

Business cash grants
These are coming (we expect within the next 2-3 weeks) but at the time of writing not yet available. We think the basic terms will be:
– Up to £25K available to those business employing staff (the availability for each business could depend on the amount of employment taxes and NI payable by the business).
– Available for: pubs, clubs, theatres, leisure, hospitality and retail businesses.

Zero business rates
Business rates will be zero for the above mentioned businesses, regardless of size. We don’t yet know if you have to apply for this reduction or whether the Council will automatically apply this.

Rents – no measures yet
Unfortunately, there have been no announcements as yet for suspension of rents paid by business or individuals. Note that in France, we understand that rents and utility bills have been suspended although this is not yet happening in the UK. We are told the Government Housing Minister will be making a statement in the coming days with further measures to protect renters through these difficult times.

Pubs and restaurants
Rules around planning are relaxed so that these businesses can offer takeaways without needing specific planning permission.

Self employed
No specific support measures yet beyond those listed above.

Taxes, VAT, PAYE/NIC payments by businesses
HMRC have a specific telephone line to call to discuss difficulties in paying taxes for individuals and businesses severely affected by the virus. 0800 0159 559 (it is open Monday to Saturday inclusive).

Sick pay for employees
Employees self isolating or sick, will be entitled to SSP of £94 per week from day one and the first 14 days will be reimbursed by the Government. This reimbursement will usually take place by deducting it from the rest of the PAYE/NI liabilities due by the business. In some cases, where the business doesn’t pay enough PAYE/NI, a business will be able to reclaim it off the Government as a payment into the business bank account.

Wills, Partnership Agreements, Shareholders Agreements, Powers of Attorney
We often talk to clients about the above during our regular accounts meetings but if you don’t have an up to date; will, Partnership agreement (where you run a Partnership agreement – this even applies to family partnerships and spousal partnerships), Shareholders agreement (where you run a limited company), we strongly urge you to look at this.

We have very recent experience where we have found; wills are not up to date, Partnership agreements either out of date or do not exist and it can cause problems when someone becomes incapacitated or dies. Problems can range from; disagreements amongst beneficiaries and those left behind to run the business, inheritance tax and capital gains tax issues, let alone the emotional turmoil. This is a good time to consider what you have in place and review this; does it suit you current needs and intentions? We can help with advice on these.

Watch out for fraudsters!
We expect that fraudsters will attempt to take advantage of the current situation and the panic some people will feel, so be vigilant, if in doubt over any; transactions, invoices, calls, emails, requests for money, please do question it.

…and finally

Although this is the greatest crisis many businesses will have faced, supporting one another and asking for help are key to this (whether this be seeking advice or asking for financial support) along with good communication.

Financial support will be available in the coming weeks but this won’t necessarily find you – you will have to look out for it and we’ll do our best to keep you informed. Do not be afraid to ask for loan repayment holidays – this potentially may be a better option short term than taking out new loans but the requirements of each business will be different.