COVID-19 advice and updates
for SMEs and the self-employed

COVID-19 SMEs and self-employed

The current pandemic is worrying for businesses and the self-employed. Unprecedented measures are being introduced almost daily.

The situation is so fast-moving that it can be easy to miss out on announcements that affect you.

To help you cut through the noise, we’ve prepared this page to guide you through the latest advice and opportunities. Please bookmark it – we will be updating it daily if we need to.

COVID-19 INFORMATION FOR BUSINESS

  1. Help with finances / cashflow
    1. RECOVERY LOAN SCHEME (from 1st April 2021)
      This replaces the Bounce Back Loan Scheme and the Coronavirus Business Interruption Loan Scheme (CBILS). Recovery Loans are 80% guaranteed by the government. Viable, UK businesses can take out loans and overdrafts between £25,001 and £10m or invoice / asset finance between £1,000 and £10m. More details are here.
    2. RESTART GRANTS (from 1st April 2021)
      The new Restart Grants scheme is aimed at businesses that have had to close due to pandemic restrictions. Non-essential retail firms can claim up to £6,000 per premises to help them reopen (currently this will be no earlier than 12th April). Firms that can’t open until later, such as businesses in the leisure, hospitality and accommodation sectors, can claim up to £18,000. Further details.
  2. Help with paying employees
    1. CORONAVIRUS JOB RETENTION SCHEME
      The Coronavirus Job Retention ('Furlough') Scheme has been extended until the end of September 2021. It pays up to 80% of furloughed workers' wages, but not employers' NI or pension contributions. In July you can claim back 70% of wages. In August and September, 60%. Flexible furlough is allowed - meaning you can bring workers back part time when needed.
      Full details are available here.
    2. HELP WITH SICK PAY
      If you are paying employees who are ill with COVID-19, government will refund up to two weeks’ worth of Statutory Sick Pay (SSP). Details of repayment mechanisms will be published in due course. Your business is eligible if you employed fewer than 250 employees as of 28 February 2020. Full information is available here.
  3. Help with tax
    1. VAT
      The VAT deferment scheme ended on 30 June 2020. If you deferred payments, you can repay them in smaller amounts over a longer period, interest free. You need to opt in to this scheme before 21 June 2021. Find out how to do this here.
    2. VAT RATE FOR HOSPITALITY, HOLIDAY ACCOMMODATION AND ATTRACTIONS.
      This 5% VAT rate, which applies to most sales in the hospitality and tourism sectors, was introduced on 15th July 2020. In the Budget, the Chancellor announced it would continue until 30 September. From October until 31st March 2022, the rate will rise to 12.5%. After that, it will revert to 20%. More information here.
  4. Help with business rates
    1. HELP FOR RETAIL, HOSPITALITY & LEISURE BUSINESSES
      If your business is in the retail, hospitality, leisure or nursery industry, then you could qualify for a business rates exemption covering the 2020-21 tax year.

For the latest government updates on support for businesses, visit this page: https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses

 INFORMATION FOR THE SELF-EMPLOYED

  1. Help with income
    1. SELF-EMPLOYED INCOME SUPPORT SCHEME
      To qualify for the fourth grant, you must have submitted your 2019/20 tax return by midnight on 2nd March. Trading profits from 2019/20 will be used in calculating the grant, meaning people who became self-employed in that year will be able to claim for the first time, as long as they have also traded in the tax year 2020/21.The fourth and fifth SEISS grants have different criteria. The fourth grant opens for claims from late April to 31st May. If you are currently trading but are impacted by reduced demand due to coronavirus, you can claim 80% of 3 months’ average trading profits, capped at £7,500. You can also claim if you have been trading, but are temporarily unable to do so because of coronavirus.

      The fifth grant, which covers May to September, is more complex. How much you get depends on how much your turnover (not profits) have fallen. If your turnover has dropped by more than 30%, you’ll get a grant of 80% of 3 months’ trading profits (up to £7,500). If your turnover has shrunk by less that 30%, you’ll get 30% of average trading profits (up to £2,850).

If you are eligible, you will be contacted by HMRC. Details on the scheme are available here.

    1. BENEFITS / SICK PAY
      Every self-employed person can now access Universal Credit at a rate equivalent to Statutory Sick Pay for employees
  1. Help with tax
    1. INCOME TAX
      Income Tax payments due in July 2020 were deferred until January 2021
      under the Self Assessment system. If you have problems paying and owe less than £30,000, you may be able to arrange a payment plan online. If you owe more, you need to speak to HMRC to arrange a payment plan.

FURTHER LINKS ON CORONAVIRUS

For the latest coronavirus news stories and blog posts, please visit the following links:

COVID-19 business news and blogs

Read More

COVID-19 personal news and blogs

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