BCC Head of Economics Suren Thiru comments on GDP figures for Q2 2020 published today by the ONS
For further information and clarification, view the Coronavirus FAQ's here.
HM Revenue and Customs (HMRC) is delivering a programme of webinars on the measures to support employers and self-employed individuals through this period of disruption caused by Coronavirus. Businesses can register to attend a free webinar to learn more about the support available to help them deal with the economic impacts of Coronavirus.
There may be some variations to the below measures announced among devolved nations. Further information on support for businesses in the devolved nations can be found:
Deferral of VAT for 3 months - VAT payments will be deferred for 3 months (until 30 June 2020). This is an automatic offer with no applications required. 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. For the self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. Self-employed will get full Universal Credit at a rate equivalent to statutory sick pay.
Time to Pay upscaled - a dedicated helpline has been set up to help businesses and self-employed individuals in financial distress and with outstanding tax liabilities to receive support with their tax affairs. Through this, businesses may be able to agree a bespoke Time to Pay arrangement.
Bounce Back Loans scheme - The scheme will offer loans from £2,000 up to 25% of a business’ turnover or £50,000, whichever is lower. The Government will provide lenders with a 100% guarantee for the loan and pay any fees and interest for the first 12 months. The government has then set the interest rate for this facility at 2.5% per annum for subsequent years. No repayments will be due during the first 12 months. Length of the loan is for six years. There will be a short, standardised online application to apply for a loan. The scheme is now open for applications and firms will be able to access these loans through a network of accredited lenders.
Coronavirus Business Interruption Loan Scheme (CBILS) - This scheme delivered by the British Business Bank, will enable small and medium sized businesses to apply for a loan, up to £5m, with the government providing a guarantee of 80% on each loan and with no interest due for the first twelve months. Personal guarantees of any form cannot be taken under the scheme for any facilities below £250k. CBILS supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance facilities. The scheme will be delivered through commercial lenders, backed by the British Business Bank. CBILS is now open for applications.
Coronavirus Large Business Interruption Loan Scheme (CLBILS) -Government will provide a guarantee of 80% to enable banks to make loans to firms with turnover of more than £45 million of up to £200 million. Companies borrowing more than £50m through CLBILS will be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan. The maximum size for invoice finance and asset finance facilities under the scheme is £50m. Facilities will be available from 3 months up to 3 years and will be offered at commercial rates of interest. The scheme will be delivered through commercial lenders, backed by the British Business Bank. CLBILS is now open for applications.
Future fund - a new Future Fund to support the UK’s innovative businesses currently affected by Coronavirus. These businesses have been unable to access other government business support programmes, such as CBILS, because they are either pre-revenue or pre-profit and typically rely on equity investment. The scheme will deliver an initial commitment of £250m of new government funding which will be unlocked by private investment on a match funded basis. The scheme is now open for applications and will initially be open until the end of September 2020.
Support to self employed individuals
Other loans and grants
Government grants will cover 80% of the salary of retained workers, up to a total of £2,500 a month. The scheme, open to any employer in the country, will cover the cost of wages backdated to 1 March. This scheme is open for claim submissions and will remain open until the end of October although the rules will begin to change from 1 July.
From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back to work part time. This is a month earlier than previously announced to help support people back to work.
From August 2020, the level of UK government grant provided through the CJRS will be slowly tapered to reflect that people will be returning to work.
On 9 June, HM Treasury announced that people on paternity and maternity leave who return to work in the coming months will be eligible for the furlough scheme even after 10 June cut-off date
The Coronavirus Job Retention Scheme (CJRS) will close to new entrants at the end of June. Review the key dates below and promote using the resources from HM Government.
See more information on the CRJS in our FAQs on UK government support measures section.
Download a template if you're claiming for 100 or more employees through the Coronavirus Job Retention Scheme.
SSP will be temporarily available to those who are advised to self-isolate and people caring for those within the same household who display Coronavirus symptoms and have been told to self-isolate. A new style Employment and Support Allowance and Universal Credit will be available to those that are not entitled to Statutory Sick Pay. For businesses with fewer than 250 employees, the cost of providing 14 days of statutory sick pay per employee will be refunded by the UK government in full. This will provide 2 million businesses with up to £2billion to cover the costs of large-scale sick leave.
From 26 May, employers across the UK with fewer than 250 employees can claim for Coronavirus-related Statutory Sick Pay (SSP). Tax agents are also able to make claims on their behalf. The repayment will cover up to two weeks of the applicable rate of SSP. See more information on eligibility and how to make a claim here.
The UK government is temporarily increasing the Business Rates discount to all businesses in the retail, hospitality and leisure sectors in England to 100% for 2020-21, irrespective of rateable value.
The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19. The scheme will provide a grant to self-employed individuals or partnerships, worth 80% of their profits up to a cap of £2,500 per month. Applications are now open. Check if you are eligible for the scheme here.
On 29 May 2020, SEISS was extended. A copy of the updated factsheet is available here. Those eligible will be able to claim a second and final grant in August. The grant will be worth 70 percent of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
Commercial tenants who cannot pay their rent because of coronavirus will be protected from eviction.This will mean that no business will be forced out of their premises if they miss a payment in the next 3 months. Commercial tenants will still be liable for the rent after this period.
The UK government has published a list of the rules that have been temporarily relaxed to make it easier for businesses to continue working through the disruption caused by Coronavirus.
New Employer Incentives for Apprenticeships, Traineeships and Kickstarter
Below is the Department for Education/Education and Skills Funding Agency webinar briefing for chambers, explaining the new employer incentives for apprenticeships, traineeships and kickstarter.
If you would like to host a local webinar for your members, please contact Nichola Akers at the National Apprenticeship Service at [email protected]
BCC Director of Trade Facilitation Liam Smyth responds to today's announcement of £200m for a new Trader Support Service for Northern Ireland traders.