The government has announced a range of support for business to help them overcome the coronavirus crisis. There will also be support for the self-employed and freelancers announced soon. It is expected that the support for self-employed and freelancers will be announced on Friday.
Here is an outline of what has been announced and what is expected:
Rate-relief & Grants
If your business was in receipt of rate relief, or had a rateable value of less than £15,000 on the 11th March 2020 you will receive a cash grant from the government of £10,000.
This is being distributed by local councils, so if you are eligible check their website to see how they are distributing grants. If you have had to close your business it may be worth putting a mail redirect from your business premises to your home address as it is likely many will send a letter.
If your business is in the hospitality, leisure and retail sector and your rateable value was more than £15,000 and less than £51,000 on 11th March 2020 then you will receive a grant of £25,000.
Businesses in the hospitality, leisure and retail sector now eligible for 100% rate relief.
Employers are required to pay sick pay for any employee that is self-isolating from day one of absence. The government will repay the first two weeks of this sick pay. It is still unclear how the sick pay will be refunded, and as far as I am aware your payroll software won’t have the capability to do this for you because it is so new. If you are using a software you will have to manually override the sick pay so that the waiting days are paid. Check with your software provider for advice on how to do this.
Keep a record of the dates of isolation, the employee name and the amount of sick pay paid to them. I expect this will be reclaimed in a similar way to SMP, but again HMRC have not announced how this will be done yet.
You can now furlough employees and reclaim 80% of wages from HMRC. Again, how this will be reclaimed is still unclear. If you have made redundancies, this scheme is available from the 1st March, so you may be able to reconsider this, you will need to check with HR as to how this will work. This scheme is set to run for three months from 1st March 2020, however it will be extended if necessary.
If your VAT falls due between 20th March 2020 and 30th June 2020 you can defer this, it must be paid before 31st March 20201.
If you have a direct debit set up to pay your VAT, then you will need to cancel this in order to defer your payment. If you don’t then you just don’t pay. VAT returns do still need to be filed.
Self-employed people will receive 80% of their average income up to £2550 per month.
You are eligible if:
You have profit of less than £50,000.
The majority of your income is through self-employment.
You completed a 18/19 tax return.
You now have 4 weeks from today to submit a 18/19 tax return if you haven’t done so already.
HMRC are hoping to have this in place by start of June and you should receive a letter from them asking you to complete an online form if you are eligible.
I know for a lot of you that are just growing your businesses this support will not be enough. Remember, if you are renting you can speak to your landlord, perhaps consider paying just half of your rent until we are all back on our feet. If you have a mortgage consider taking a mortgage holiday.
You can also try to apply for universal credits to see if you can get additional support and speak to your local council and see if they can help in any way.
I know there are still several people that won’t get the support that they need. We can only hope that more help will be announced in the coming days and weeks.