Copyright Moore Barlow LLP (Moore Blatch and Barlow Robbins merged May 2020)

My business has been affected by coronavirus, what support is available to me?

In the last two weeks we have seen the government introduce stringent measures in the fight to tackle coronavirus. This has impacted both small and large businesses alike.

Various measures have been introduced and proposed to support businesses during this time. It is difficult to keep track of what support is available to businesses with the influx of news on a daily basis and therefore the intention of this article is to summarise the key measures in one place. Please follow the link’s to access more details on the different measures.

We intend to update this article as new measures are implemented or proposed. Please feel free to save the webpage to your favourites and check back to keep up-to-date on the support available to your business.

Emergency legislation was passed and the ‘Coronavirus Act 2020’ is now in force. Please note some of these measures below are proposed only at this stage and not yet in force.

  1. Coronavirus Business Interruption Loan Scheme
  • Small businesses (turnover up to £45m + other eligibility factors) can apply for a loan of up to £5m.
  • 80% of the loan is guaranteed to the lender by the government.
  • The government will pay interest and fees for 12 months.
  • Repayment terms up to 6 years.
  • Chancellor Rishi Sunak announced the following changes to the loan scheme on 2 April 2020:
    • Applications are not limited to businesses that have been refused a loan on commercial terms.
    • Businesses with a turnover of £45m to £500m may also apply for a loan under the scheme of up to £25m.
    • Lenders are banned rom asking the business owners to personally guarantee loans when borrowing under £250,000.
  1. Small Business Grant Scheme (£10,000 grants)
  • Available for the UK’s 700,000 smallest businesses.
  • Businesses entitled to a grant will be contacted by local authorities in April.
  • Small businesses that pay little or no business rates and are eligible for small business rate relief (SBBR) will be entitled to a grant.
  1. Cash grants of up to £25,000
  • Available for retail, hospitality and leisure businesses with a rateable value below £51k.
  • Grant will be between £10,000 and £25,000 (depending on the businesses rateable value).
  1. Bank of England’s Covid Corporate Financing Facility (“CCFF”)
  • Available to firms making a material contribution to the UK economy.
  • The CCFF will provide funding to businesses by purchasing commercial paper of up to one-year maturity. Commercial papers are unsecured, short-term debt instruments issued by a company (effectively an IOU).
  • Businesses do not need to have previously issued commercial paper in order to participate.
  1. Business Rates holiday

Available to retail, hospitality and leisure businesses and nurseries in England for the 2020 to 2021 tax year.

  1. Business Tenancies

Business tenancies for non-payment of rent cannot be enforced until 30 June 2020 (date could be changed).

  1. Coronavirus Job Retention Scheme
  • Grants will be available this month for employers (regardless of business size) to pay up to 80% of the wages for any retained workers who are not actively in work but are still on the payroll.
  • They can be backdated to 1 March 2020.
  1. Tax
  • HMRC have set up a tax helpline for business owners and the self-employed. The number to call is 0800 0159 559.
  • It may be possible to organise a Time to Pay arrangement with HMRC.
  1. Deferred VAT
  • Any businesses that pay VAT will have payments for the next quarter deferred.
  • These deferred payments do not need to be paid until the end of the next financial year.
  1. Interest Rates cut to 0.1%
  1. Commercial contracts

The unprecedented nature of coronavirus gives rise to two possibilities for non-performance and avoiding legal liability in commercial contracts by way of Force Majeure and Frustration clauses.

  1. Certain planning regulations relaxed

These have been relaxed so that pubs and restaurants can switch to provide takeaways or deliveries, without applying for change of use.

  1. IR35 delayed

The off-payroll working rules (IR35) that would have applied for people contracting their services to large or medium-sized organisations outside the public sector, will be delayed for one year from 6 April 2020 until 6 April 2021.

  1. Statutory Sick Pay

SMEs will be able to reclaim Statutory Sick Pay (SSP) paid for employee’s sickness absence due to coronavirus.

  1. Companies House

Extended deadlines for filing provided companies apply before the normal deadline.

  1. Insurance
  • Most standard business interruption insurance policies are dependent on damage to property and will exclude pandemics. Businesses will need to check their policy terms closely.
  • The government and insurance industry has confirmed the government’s advice to avoid pubs etc. is sufficient to make a claim under a policy that covers both pandemics and government-ordered closures.

We hope that some of the measures detailed above help your business during this difficult time. However, if you are worried about the future of your business, please do not hesitate to contact our insolvency and restructuring team who will be happy to assist you.