COVID-19

The Chancellor announced £4.6 billion in new lockdown grants to support businesses and protect jobs in the retail, hospitality and leisure sectors. Businesses are to receive a one-off grant worth up to £9,000. This is on top of the funding which has already been guaranteed to continue to provide the devolved administrations the certainty they need to plan for their COVID-19 response in the months ahead.

1. The one-off top-ups will be granted to closed businesses as follows:
   • £4,000 for businesses with a rateable value of £15,000 or under
   • £6,000 for businesses with a rateable value between £15,000 and £51,000
   • £9,000 for businesses with a rateable value of over £51,000
2. £594 million discretionary fund also made available to support other businesses impacted by the restrictions.
3. comes in addition to £1.1 billion further discretionary grant funding for Local Authorities, Local Restriction Support Grants worth up to £3,000 a month and extension of furlough scheme

Eligibility:

All businesses eligible for the National Lockdown Grants in November will automatically be entitled to receive the new Government grants WITHOUT APPLYING. You will automatically be credited with one bulk payment which will include three payments of:

• Tier 4 Grants from November 20th to January 4th
• National Lockdown grants from 5th January to February 22nd
• The additional Closed top up grant of £4,000, £6,000 or £9,000 depending on the size of your business

As always please keep hold of your reference number so we can support any enquiries you may have.

A new support package for businesses affected by high-level (Tier 2) COVID restrictions.

The grants are aimed at businesses in the hospitality and leisure sector and will be allocated to local authorities soon. The funding local authorities will receive will be based on the number of hospitality, hotel, B&B, and leisure businesses in their area, and will assume that these businesses receive grants equivalent to 70% of the grants for which legally closed businesses are eligible.

This would be equivalent to:

• For properties with an RV of £15k or under, grants of £934 per month
• For properties with an RV above £15k and below £51k, grants of £1,400 per month
• For properties with an RV of £51k or above, grants of £2,100 per month

It will be up to Local Authorities to determine what precise funding to allocate to each business – the above levels are only an approximate guide.

Local authorities will also receive a 5% top up amount to these implied grant amounts to cover other businesses that might be affected by the local restrictions, but which may not be in the business rates system.

UPDATE: Lambeth Council has paid out in excess of £2million to businesses that were forced to close during the second national lockdown period (05 November – 02 December).

Who is eligible?

Local authorities have the freedom to determine the precise eligibility criteria for these grants in their local areas. The guiding principle for local authorities is to use the funding to support businesses which have not been legally required to close, but which are nonetheless severely impacted by reduced demand caused by Tier 2 restrictions on socialising.

How can businesses access the grants?

Grants will be administered by Local Authorities, and businesses are likely to need to apply to their local authority for support. It is up to local authorities to determine the payment schedule and timings for these grants.

What can businesses use the grants for?

Businesses can choose to spend the grants as they wish. We expect that many businesses will use the grants to cover high fixed property-related costs.

What about areas which have been living under Tier 2-equivalent restrictions for several months already? Will you help them?

Some areas have been subject to restrictions on socialising for several months, before the tiering system was introduced. Funding for these areas will be backdated until the point at which these restrictions began.

This scheme will initially run until April, with a review point in January. Further information here.

The Retail, Hospitality and Leisure Grant provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000.

For businesses in these sectors with a rateable value of between £15,001 and £51,000, they will receive a grant of £25,000.

Eligibility

You are eligible for the grant if:

• your business is based in England
• your business is in the retail, hospitality and/or leisure sector

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

• as shops, restaurants, cafes, drinking establishments, cinemas and live music venues
• for assembly and leisure
• as hotels, guest and boarding premises and self-catering accommodation

How to access the scheme

This will be administered via the business rates team at Lambeth Council. They are compiling a list of eligible businesses and identifying where they have gaps in bank details or contact details. This list will be provided to us and the other Lambeth BIDs to populate.

Local businesses who believe they are eligible for the business grants of £10,000 or £25,000 need to complete a short form required by Lambeth (on behalf of Government) to capture necessary details and act against fraud.

Check your Rateable Value here and eligibility criteria.

The new Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, enables businesses to apply for a loan of up to £5 million in value and for up to 6 years, with the government covering up to 80% of any losses (subject to a per-lender cap on claims)  with no fees to support long-term viable businesses who may need to respond to cash-flow pressures by seeking additional finance.

Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments. (up from the initial 6 months as per 20/03/2020 announcement)

You can find the latest information from the British Business Bank with further details.

Notice of changes (03/04/2020):

• The scheme is now available to all viable small businesses affected by COVID-19, not just those unable to secure regular commercial financing
• Lenders are banned from requesting personal guarantees for loans under £250,000
• Operational changes aimed at speeding up approvals
• The requirement for businesses to provide proof that they have no other means of accessing funding has also been removed.

It is important for businesses to remember that these are loans, not grants, and will therefore need to be paid back in due course with interest charges.

Eligibility

You are eligible for the scheme if:

• your business is UK based, with turnover of no more than £45 million per year
• your business meets the other British Business Bank eligibility criteria

What do I have to do? 

To apply, you should talk to your bank or one of the 40 accredited finance providers (not the British Business Bank) as soon as possible, to discuss your business plan.

All major banks are offering this scheme. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

Ahead of contacting the bank for a loan, businesses should prepare information such as up to date accounts, management information and cash flow forecasts.

The full rules of the scheme and the list of accredited lenders are available on the British Business Bank website.

A3 to A5 use 

The government has confirmed the relaxations to planning rules will be put in place as soon as possible to provide reassurance to businesses and enable them to start providing takeaways to people quickly. These changes will provide vital flexibility to pubs and restaurants and will ensure people are able to safely stay at home while still supporting some of the great local businesses across this country.

The government has published a new ‘Permitted Development Right’ to enable this. It allows these types of premises to provide prepared hot or cold food, for collection or delivery, for consumption off the premises – without the need for planning permission.

It is important to note that this new legislation allows businesses to operate in this way until the 23 March 2021 – before which such use must cease.

The government's announcement on 17th March confirmed that the government's advice to avoid pubs, clubs and theatres etc. is sufficient for businesses to claim on their insurance where they have appropriate business interruption cover in place for pandemics.

What do I have to do?

Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers.

This Scheme will cover 80% of wages up to £2,500/month per employee, back dated to 1 March for at least 3 months and it will be extended for longer if needed.

UPDATE (March 2021): The government is extending the Coronavirus Job Retention Scheme for a further five months from May 2021 until the end of September 2021. Employees will continue to receive 80% of their current salary for hours not worked. There will be no employer contributions beyond National Insurance contributions (NICs) and pensions required in April, May and June. From July, the government will introduce an employer contribution towards the cost of unworked hours of 10% in July, 20% in August and 20% in September, as the economy reopens.

Eligibility

• UK employer – this includes the public sector, Local Authorities and charities.
• Employees operating under PAYE

The latest clarifications:

• • Employers can switch employees between sick pay and furlough, but the scheme should not be used to ‘top up’ SSP for short term absences.  Employees who are ‘shielding’ from coronavirus are eligible to be furloughed and do not need to be placed on sick pay
  • Furlough is available to all employees, and is not considered a breach of visa conditions for those with work visas
  • Employers of staff who have been newly TUPE’d are eligible to claim under the scheme
  • Reclaimable NI and pension elements are to be calculated on the furlough salary rate
  • Furloughed employees cannot undertake work that provides services or generates income for the employer, or for organisations linked to the employer
  • The entire grant must be paid to the employee with no deductions for fees or admin
  • Businesses that engaged in payroll consolidation schemes after 28 February can furlough employees

What do I need to do?

• designate affected employees as ‘furloughed workers,’ and notify your employees of this change
• submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.

UPDATE: Scheme extended until the end of October. After July, employers will be asked to contribute financially. More detail is to be announced this month and will be published on the government website.

The government has launched the Future Fund aimed at supporting UK-based companies who can now apply for a convertible loan of between £125,000 and £5 million, to support continued growth and innovation.

These convertible loans may be a suitable option for businesses that rely on equity investment and are unable to access the Coronavirus Business Interruption Loan Scheme. The scheme will be delivered in partnership with the British Business Bank.

Eligibility

You’re eligible if your business:

• is based in the UK
• can attract the equivalent match funding from third-party private investors and institutions
• has previously raised at least £250,000 in equity investment from third-party investors in the last 5 years

More details about The Future Fund available here

A dedicated helpline has been set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities receive support with their tax affairs.

If you are struggling to pay tax due to the coronavirus, you may be eligible for deadline extensions through HMRC's Time to Pay service. Using this helpline, businesses may be able to agree a ‘Time to Pay’ arrangement with HMRC.

The budget also states that HMRC will waive late payment penalties and interest where a business experiences administrative difficulties contacting HMRC or paying taxes due to COVID-19.

Call HMRC’s dedicated helpline on 0800 0159 559.

The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) who have lost income due to coronavirus (COVID-19).

This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.

Eligibility

• Be self-employed or a member of partnership;
• Have lost trading/partnership trading profits due to COVID-19;
• File a tax return for 2018-19 as self-employed or a member of a trading partnership. Those who have not yet filed for 2018-19 will have an additional 4 weeks from this announcement to do so;
• Have traded in 2019-20; be currently trading at the point of application (or would be except for COVID 19) and intend to continue to trade in the tax year 2020 to 2021
• Have trading profits of less than £50,000 and more than half of your total income come from self-employment. This can be with reference to at least one of the following conditions:
  • Your trading profits and total income in 2018/19
  • Your average trading profits and total income across up to the three years between 2016-17, 2017-18, and 2018-19.

What do I need to to?

HMRC will contact those who are eligible for the scheme by using existing information to check potential eligibility and invite applications once the scheme is operational.

HMRC will then pay the grant directly to eligible claimants’ bank account. HMRC is urgently working to deliver the scheme; grants are expected to start to be paid out by beginning of June 2020.

Further information on how to access these schemes can be found here.

UPDATE (March 2021): To support the self-employed across the UK through the next stage of the pandemic, the government confirms that the fourth Self Employment Income Support Scheme grant will be worth 80% of three months’ average trading profits, paid out in a single installment and capped at £7,500 in total. The grant will cover the period February to April, and can be claimed from late April.

Self-employed individuals must have filed a 2019- 20 Self Assessment tax return to be eligible for the fourth grant. The government announces that there will be a fifth and final SEISS grant covering May to September. The value of the grant will be determined by a turnover test, to ensure that support is targeted at those who need it the most as the economy reopens. People whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, capped at £7,500. People whose turnover has fallen by less than 30% will receive a 30% grant, capped at £2,850. The final grant can be claimed from late July.

Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.

For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.

Eligibility

If you are self-employed you are eligible.

Find out more about eligibility and how to access the Income Tax scheme here.

What do I have to do?

This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.

The scheme will be open for an initial three months with people able to make their first claim by the beginning of June.

If you are a UK VAT registered business and have a VAT payment due between 20 March 2020 and 30 June 2020, you have the option to defer the payment until a later date within the 2020/2021 financial year or pay the VAT due as normal.

Eligibility

All UK businesses are eligible.

What do I have to do?

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.

More information here.

Banks and other lenders have announced a range of financial support to help business customers, including repayment holidays and fee-free loans. Below are some of those that we are aware of, but you may wish to contact your own bank to see if they can help with your particular requirements.

• Natwest has announced measures such as loan repayment holidays, temporary emergency loans with no fees and a £5bn Working Capital fund. See here for more detail.
• Lloyds Bank have announced measures such as potential repayment holidays for business customers most affected. See here.
• HSBC have similarly announced a £5bn fund to support business customers and claim to be discussing individually with businesses what their requirements are. Click here to read more.

We will endeavour to keep you updated as new information becomes available about how some of these support measures can be accessed.