16.03.2020: Update on 2020 Budget
Dear Valued Client,
We thought we’d send through an update on our Budget Summary from last week to offer more information on the initiatives the Government announced.
Information is currently limited but will be updated as and when possible, therefore we will continue to update you through this method as much as we are able to so that you stay as informed as possible!
Business Interruption Loans (Coronavirus Business Interruption Loan Scheme)
This initiative will temporarily replace the Enterprise Finance Guarantee loans and will make the lending more attractive for borrowers and lenders alike. The CBILS will be provided by the British Business Bank and there are other types of finance available such as overdrafts, invoice finance and asset finance.
To be eligible for a CBILS the business must be:
Be UK based, with turnover of no more than £41m pa
Operate within an eligible industrial sector (bank, insurance companies, primary educators, trade unions etc are some of the industries not covered)
Have a sound borrowing proposal, but insufficient security to meet a lenders normal requirement
Be able to confirm that they have not received de minimis State aid beyond £200,000 equivalent over the current and previous two fiscal years
Further information along with a full list of eligible industrial sector and accredited lenders can be found here -https://www.british-business-bank.co.uk/ourpartners/supporting-business-loans-enterprise-finance-guarantee/
They are still working on the finer details and will be updating the website with further information over the coming days, we hope to be able to update you again later in the week on this issue.
Support for businesses who are paying sick pay to employees
HMRC will repay up to two weeks SSP paid to employees who have been off work due to COVID-19, either through self-isolation or the virus itself. Their website has stated that they will be working with employers over the coming months to set up the repayment mechanism for employers as soon as possible, so it doesn’t look like this is going to be immediate.
In the meantime, to be able to claim the repayment you should keep detailed records of the dates that employees are off and the reasons why. The sick pay starts from day 1 rather than day 4 and there is no need for the employee to have a GP fit note.
Current SSP rates are £94.25 per week, this is the amount you can claim back from HMRC but you will need to pay your employees the amount as stated in their employment contracts or more if you wish.
Support for businesses that pay business rates
The 100% discount that was announced for those in the Retail, Leisure and Hospitality industries will be applied automatically to those who were receiving the retail discount previously, local authorities should be rebilling shortly for the 2020/21 year.
Those businesses in the leisure and hospitality industries may need to apply to their local authority to receive the discount, local authority guidance will be issued on 20thMarch 2020 after which we should know more on how businesses can apply.
Support for businesses who pay little or no business rates
The government will provide an additional £2.2 billion funding for local authorities to support small businesses that already pay little or no business rates because of Small Business Rate Relief (SBBR). This will provide a one-off grant of £3,000 to business currently eligible for SBRR or Rural Rate Relief, to help meet their ongoing business costs.
For those who do not have commercial offices or are in serviced offices, on the face of it, it appears that you will not be eligible for this grant unfortunately. Again, there is not much guidance on this or how you are able to apply, and we will update you as soon as we have more information.
Should you have further questions or require any further assistance after this update then please do get in contact with us where we will endeavour to assist as much as possible.
We understand it is a very uncertain time at present, it is difficult for all and especially those who feel ill. We urge you to listen to guidance given by health officials and the Government as and when necessary.