The Government has announced a number of measures to support businesses through the period of disruption caused by COVID-19. The key ones are:
- a Job Retention Scheme whereby HMRC will reimburse 80% of "furloughed workers" salary costs, up to a cap of £2,500 per month – a furloughed worker is taken to mean employees on temporary leave due to the disruption. HMRC is urgently working to set up a reimbursement system.
- the deferral of VAT payment due between 20 March 2020 to 30 June 2020 which is to apply automatically and the businesses will be given until 5 April 2021 to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims are to be paid by the Government in the normal way.
- for those who are self-employed, the income tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021 – this is an automatic offer with no applications required and no penalties or interest for late payment is to be charged in the deferral period.
- A general Time To Pay Scheme which is to be available to all businesses as well as self-employed people in financial distress and with outstanding tax liabilities (which includes PAYE liabilities). These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.
Other measures include:
- a Statutory Sick Pay relief package for SMEs;
- a 12-month business rates holiday for all retail, hospitality and leisure businesses in England;
- small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief;
- grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000;
- the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank; and
- a new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans.
(Further details are available here)
Practical guidance for COVID-19
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