March 24, 2020

Support packages for businesses affected by Coronavirus

Coronavirus has severely disrupted normal business operations in the UK. And the sad reality is, it will continue to disrupt businesses for months to come.

That’s why the Chancellor has set out a package of temporary, timely and targeted measures to support businesses through this period of disruption caused by COVID-19.

The Conservative Party are the Party of Business. At a difficult time for business owners and workers alike, this Government is devoted to providing unprecedented levels of support. To make sure that your business gets the support it needs to get through these difficult times.

We’ve announced a range of measures to help businesses – find our key measures below, and how to claim support if you need it.

Coronavirus Business Interruption Loan Scheme

The Coronavirus Business Interruption Loan Scheme helps businesses access bank lending and overdrafts if they’ve been badly affected by Coronavirus. Rather than providing loans of up to £1.2 million, which it was previously, we’ve extended this figure amount to £5 million per loan, with no interest due for the first 12 months

The Government will guarantee 80% of each loan. That means lenders will have more confidence, and will be better able to give financial support to businesses. And the Government will provide this guarantee free of charge.

You will be eligible if your business is UK-based, with turnover of no more that £45 million per annum, and your business meets the British Business Bank eligibility criteria. The scheme commenced on the 23rd March.

If you want to access the loan scheme as a small business, talk to your bank or finance provider as soon as possible. Discuss your business plan with them. Your finance provider can then act quickly to give you the support you need.

Business Rates Holiday for Retail, Hospitality and Leisure businesses

We expect businesses in the retail, hospitality and leisure sectors to, unfortunately, be especially hard hit by Coronavirus. That’s why we’re providing these businesses additional, tailored support.

Across England, businesses in the retail, hospitality and leisure sectors will not have to pay business rates for the 2020/21 tax year. And businesses that received the retail discount in the 2019-20 tax year will be rebilled the correct amounts by their local authority as soon as possible.

Your business will qualify if it is based in England, and is in the retail, hospitality and/or leisure sector. That means, for example, shops, restaurants, cafes, drinking establishments, cinemas and live music venues. Venues which are primarily used for assembly or leisure, such as hotels, as boarding premises, or as self-catering accommodation will also likely qualify.

This will be provided automatically for your business if you qualify – there is no action you need to take. Your local authority will apply the business rates holiday to your bills.

Nurseries in England also do not have to pay business rates for the 2020-21 tax year. Providers on Ofsted’s Early Years Register will receive support automatically from their local authority.

You can calculate your estimated savings and business rate charge on the Government’s business rate calculator.

Cash Grants for Retail, Hospitality and Leisure

As further support for the hardest-hit sectors, we’ll be providing cash grants for retail, hospitality, and leisure businesses.

If your business is in the retail, hospitality or leisure sector, you will receive a cash grant of up to £25,000.

Businesses in these sectors with a rateable value of under £15,000 will receive a grant of £10,000, while businesses with a rateable value less than £51,000 will receive a grant of £25,000.

Businesses that qualify for the business rates deduction will also qualify for this cash grant. You’ll receive this benefit through your local authority, if you qualify. They will write to you directly if you stand to receive a grant. You may also write to your local authority for further advice.

Small Business Grant Funding

The Government is providing additional funding for Local Authorities to support small businesses across all sectors.

If you already pay little or no business rates because of small business rate relief, rural rate relief, or tapered relief, you could qualify for extra support. This could provide a one-off grant of £10,000 to help you meet your ongoing business costs.

Your local authority will write to you directly about this support, if you qualify.

Statutory Sick Pay Rebate

We’re making sick pay easier to claim and manage, both for individuals and for small businesses.

If you’re a UK business that employs fewer than 250 employees as of 28 February 2020, you could qualify for up to 2 weeks’ statutory sick pay rebate, per eligible employee, who has been off work because of coronavirus.

The Government will work with employers over the coming months to set up how to claim your rebate in the most effective and easy way possible.

If you are self-employed and want to know if you are eligible for Universal Credit, please visit the gov.uk Universal Credit page for advice.

Time to Pay Service

We know many otherwise-successful businesses may struggle during these difficult times. So we’re providing extra support for those small business owners and self-employed people in financial distress through the Time To Pay service.

The Time to Pay scheme lets businesses build a structured payment plan for debt over an agreed time period with the HMRC, or Her Majesty’s Revenue and Customs. In light of Coronavirus, the HMRC have been instructed to be more permissive in handing out support.

They are arrangements agreed on a case-by-case basis, tailored and bespoke to your circumstances. So if you need special support through these tougher times, the Government will make sure to give you what is fair so you can defer tax payments to a better time.

So if your business has outstanding tax liabilities, and is based in the UK, contact the HMRC on their website or call 0800 0159 559 for support. Up to 2,000 experienced call handlers are available to give you the help you deserve.

COVID-19 Corporate Financing Facility

Many larger companies are fundamentally strong, but have been affected by a short-term funding squeeze. So the Bank of England will buy short-term debt from larger companies through CCFF, or the COVID-19 Corporate Financing Facility.

The scheme, funded by central bank reserves, is aimed to relieve cash flow pressures on firms that make a material contribution to the UK economy.

If you run a larger company and want support, you should contact your bank to make an application. While not all banks are issued with commercial paper and can’t provide support directly, UK Finance can provide a list of banks who can help you.

For more information, you can go to the Bank of England’s website for support.

VAT deferrals for three months

We will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. All refunds and reclaims will be processed and paid by the Government as normal. If your business is VAT-registered in the UK, then you will receive the offer automatically.

The deferral will apply from 20 March until the end of June, and will be automatic for most businesses.

If you are self-employed, Income Tax payments due in July 2020 are also deferred to the end of January 2021. And no penalties or interest for late payment will be charged in that period.

Coronavirus Job Retention Scheme

All UK employers with a PAYE scheme, will be able to get support to pay part of their employees’ salary for those who would otherwise have been laid off. This applies to people who are known as ‘furloughed’ workers, or those who have been asked to stop working but are still on the pay roll.

HMRC will reimburse 80% of each person’s wage, up to a maximum of £2,500 a month, to safeguard workers from being made redundant. That means more people get the security of a job in tough times.

The scheme will be open for an initial three months, backdated to start on March 1st, but will be extended if necessary. To access the scheme, follow the advice on the Government’s website.

If you want to talk to someone about how these schemes apply to your business, in England you can contact the Government’s Business Support Helpline for free advice. You can reach them over the phone at 0300 456 3565 Monday to Friday, 9am to 6pm.

And if you need any additional support, go to gov.uk/coronavirus for the most up-to-date information.

Region Labour's Pension Tax (£) Extra Months to Work
England 11,167 44
East Midlands 6,150 50
Greater London 12,871 45
North East 9,758 38
North West 6,835 47
South East 14,270 40
South West 7,407 45
West Midlands 10,729 41
Northern Ireland 13,718 35
Scotland 10,653 41
Wales 11,691 36
United Kingdom 11,253 43

Commenting, Therese Coffey, Secretary of State for the Department of Work and Pensions, said:

“Corbyn’s Pension Tax will see ten million savers facing a huge bill forcing them to delay their retirement for almost three and a half years.
“This is just one of the ways a Corbyn government would hammer hardworking people on top of his plans to hike up taxes by £2,400 a year, as well as the cost of his plan for unlimited immigration and the chaos of 2020 being dominated by two more referendums – one on Brexit and another on Scottish independence.
“Only Boris Johnson and the Conservative Party can get Brexit done with a deal, get parliament working again and turbocharge our economy to unleash Britain’s potential.”

Read more about how this Pension Tax will impact millions of savers (PDF)