Local resident Rachel Jarvis is a business coach for ActionCOACH and is keen to make Wanstead’s business owners aware of the support available to them during the current crisis
As you know, the UK is in the midst of the coronavirus outbreak and many small and medium-sized businesses are already feeling the effects. I encourage all business owners to read HMRC’s guidance for employers and business owners, which can found at gov.uk.
Some of my clients have already contacted HMRC, who have been very understanding and have offered to defer all tax payments (including VAT) for two months. In effect, this is free credit to help with potential cash flow issues. Many businesses are following suit, and I would encourage others to do the same. The simple principle here is: once you’ve paid it, you won’t get it back! HMRC are likely to have to give further concessions if the effect of coronavirus is as severe as expected.
Banks are also said to be increasing credit lines and overdrafts, and in some cases, they may even offer repayment holidays on loans. And many of my clients are contacting all of their suppliers to ask about relaxing payments.
The government has launched a Coronavirus Business Interruption Loan Scheme, which will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the scheme will support loans of up to £5m in value. Companies can access the first six months of that finance interest-free.
For businesses with fewer than 250 employees, the cost of providing 14 days of statutory sick pay per employee will be refunded by the government in full. This will provide two million businesses with up to £2bn to cover the costs of large-scale sick leave. Coronavirus statutory sick pay is expected to be in the form of a refund.
For the self-employed not eligible for statutory sick pay, contributory Employment and Support Allowance will be payable, at a rate of £73.10 a week if you are over 25, for eligible people affected by coronavirus.
There are also cash grants of up to £10,000 for our smallest businesses, which will be delivered by local authorities. The council will have further information on this as the scheme is rolled out.
And a business rates holiday has been introduced for 2020–21 for retail, hospitality and leisure businesses with a rateable value of over £51,000. A £25,000 grant will be provided to businesses in this sector operating from smaller premises, with a rateable value between £15,000 and £51,000. This will also be implemented through your local council.