LOCKDOWN 3: new and extended support schemes

Businesses and self-employed workers can access a range of new and extended Coronavirus support to help them through the latest lockdown, so it's worth checking you've applied for all the schemes you're eligible for.

The deadlines for many of these schemes, such as the Coronavirus Job Retention Scheme and Business Interruption Loan Scheme, have been extended, however, some schemes are closing soon so you may need to act quickly.

If you need assistance with accessing any of the schemes, raising finance, or have queries on what help you qualify for, please do get in touch.


 

WHAT HELP IS AVAILABLE?

Coronavirus Job Retention Scheme (CRJS) - HMRC will reimburse UK employers 80% of employee wage costs for hours not worked (up to a cap of £2500 per month). This scheme has been extended until 30 April 2021. To be eligible, employees must have been employed on 30 October 2020 and submitted a PAYE RTI to HMRC between 20 March 2020- 30 October 2020. Employers do not need to have submitted a previous claim for employees prior to 30 October 2020 to apply. Applications can be submitted through the online claims portal and further details can be found here.

Self-Employment Income Support Scheme (SEISS) - Self Employed workers (including members of partnerships), who have lost income due to the Coronavirus pandemic, may qualify to claim a taxable grant from HMRC worth 80% of their trading profits, up to a maximum of £7500 in total. Claims for the third grant are currently open and you must make your claim on or before 29 January 2021.

To be eligible for the third grant your business must have suffered from a new or continuing impact from Coronavirus between 1 November 2020 and 29 January 2021 and you also have to 'reasonably believe your business will have a significant reduction in profits'. It's important to note that the rules have been tightened here; 'a significant reduction in profits' was not mentioned in either of the first two grants, where businesses only had to be 'adversely affected due to Coronavirus' in order to apply. If you were not eligible for the first and second grant (based on the information in your Self-Assessment tax returns), you will not be eligible for the third. Further details can be found here.

Deferring VAT - if you deferred VAT between 20 March and 30 June 2020 and still have payments to make, you can opt into the VAT deferral new payment scheme which will launch online shortly. Instead of paying the full amount by the end of March 2021, this scheme will allow businesses to make up to 11 small monthly instalments, interest free. All instalments must be paid by the end of March 2022. To be eligible, you must have opted into the scheme before 31 March 2021. Further details can be found here.

No further VAT deferrals have been announced at the current time, but you can organise a Time to Pay arrangement for other HMRC debts and outstanding tax. Any deferrals must be agreed in advance please contact HMRC urgently if you will have difficulty in meeting any tax payment deadlines. Further information can be found here.

Income Tax - no further income Tax holidays have been announced. Therefore, at the current time, the Self-Assessment Tax deadline for 2020/21 is 31 January 2021. If you cannot pay your tax bill and owe less than 30,000, then you can set up an online payment plan online with HMRC as long as your tax returns are up to date, and you have no other payment plans or outstanding debts with HMRC. Further information can be found here.

Statutory Sick Pay (SSP) - the government will pay SSP for every day that an employee is self-isolating, subject to certain circumstances. Eligible employees include those advised to shield or self-isolate for medical reasons, those who have Coronavirus symptons/are living with someone with Coronavirus symptons or where someone in their support bubble or extended household has Coronavirus symptons. Eligible employees also include those who have been notified that they've been in contact with someone with Coronavirus via the NHS app and told to self-isolate. SSP is not payable for employees self-isolating prior to entering or returning to the UK. For more information, please see here.

Coronavirus business loans - although government-backed loan schemes have been extended recently, we suggest speaking to your bank or existing finance provider in the first instance to ensure the greatest chance of success.

The following Coronavirus loan schemes are also available:

  • Coronavirus Bounce Back Loans - small and medium-sized businesses can use this scheme to borrow between £2,000 - £50,000 (up to 25% of their turnover). The scheme is open to applications until 31 March 2021. If you already have a Bounce Back Loan, but borrowed less than you were entitled to, you can top up your existing loan to your maximum amount. You must request the top-up by 31 March 2021. For more information, please visit https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan.
  • Coronavirus Business Interruption Loans (CBILs) - government backed loans of up to £5m per business are available through the British Business Bank. This scheme has been extended until 31 March 2021. For further information and to apply, please visit https://www.gov.uk/guidance/apply-for-the-coronavirus-business-interruption-loan-scheme.
  • Future Fund - the Future Fund provides government loans for high growth firms from £125,000 to £5m. This scheme has been extended until 31 January 2021. For further information and to apply, please visit https://www.gov.uk/guidance/future-fund
  • Innovation Continuity Loans - SMEs and third sector organisations which are having difficulty in continuing innovation activities due to Coronavirus can apply for a loan between £250,000 to £1.6m to help continue live projects, subject to certain critera. Applications can be made up until 13 January 2021 and further details can be found here.

Business Rates Relief for the retail, hospitality and leisure sector - a business rates holiday (100% retail discount) was announced for all businesses in the retail, hospitality and leisure sector as part of the spring lockdown last year. There were some grey areas for certain sectors and what qualifies as "retail", so if you think you may qualify, but have never made a claim, we would advise you to contact your local authority.

Business rates for other sectors - prior to COVID-19, some businesses, could already have been eligible for some form of relief from paying Business Rates (e.g. Small Business Rates Relief, Retail Discount, Rural Rates Relief etc). You may be able to get a form of business rates relief from your local council to reduce your bill. This is sometimes automatic, but you may need to apply and the process depends on whether you're in England or Wales.

There are some details online - https://www.gov.uk/apply-for-business-rate-relief - on what types of buildings may benefit from automatic relief and which ones should require you to make a claim by contacting your local council. Your council should automatically apply "exempted buildings and empty buildings relief" or "transitional relief" if your rates change on review by a certain amount.

Local Restrictions Support Grant, or LRSG (Closed) Addendum - following the update on 5 January 2021, businesses that have been required to close as part of the latest national restrictions may be eligible for a one-off grant payment of up to £9000. For further information on the scheme and which businesses are eligible, please visit https://www.gov.uk/guidance/check-if-your-business-is-eligible-for-a-coronavirus-grant-due-to-national-restrictions-for-closed-businesses.

If your business qualifies, you will need to apply through your local Council. The Bath & North East Somerset (BANES) online application form isn't available currently, but we expect that it will appear as a link on the following page when it goes live: https://beta.bathnes.gov.uk/coronavirus-covid-19-latest-information-and-advice/help-businesses.

HMRC Time to Pay - If you are self-employed and cannot pay your tax bill on time and don't qualify for a payment plan, or can't access the service online, please call the Self-Assessment Payment Helpline on 0300 200 3822, Monday-Friday from 8am-4pm (excluding bank holidays).

If you need to defer other tax bills, you can set up a Time to Pay arrangement. If you've received a payment demand, like a tax bill, or a letter threatening you with legal action, then you need to call the HMRC office that sent you the letter. However, if you've not recieved a bill or letter, then you can call the Payment Support Service on 0300 200 3835, Monday-Friday from 8am-4pm (excluding bank holidays). For more information, please visit https://www.gov.uk/difficulties-paying-hmrc.

WE'RE HERE TO HELP

We stand ready to help you and will keep you abreast of changes should further announcement be made by the government.

If you would like advice on accessing Coronavirus support, or for help with bookkeeping, cash flow management or payroll during the Coronavirus pandemic, please call us on01225 325580 or email info@richardsonswift.co.uk.

Please note that this is only a summary of the main issues and should not be construed as advice. Every effort has been made to ensure factual accuracy at the time of publication (8 January 2021), however the government response to the Coronavirus situation is changing 24-7, so it should not be not relied upon completely.