Covid-19 Guidance for Businesses
The Government has announced wide-ranging plans to support businesses of all types during the coronavirus outbreak.
We want to support you through this time by helping you to understand the options available to you and how to access them.
We are making our latest guidance available to all through this page, which will be reviewed frequently as more measures and details are released by the Government and HMRC.
- Self-employed and Freelancers
- Business Rates
- Grant funding
- Business interruptions Loans
- Support for businesses who are paying sick pay to employees
- Flexibility on tax payments deadlines
- Support for businesses through the Coronavirus Job Retention Scheme
- VAT deferment
- Companies House filing deadline extension
- Charities Commission filing deadline extension
- Protection to commercial tenants from eviction
- Extension on MOT
- Commercial insurance
1. Self-employed and Freelancers
“A ray of hope for COVID-19 affected self-employed and freelancers”.
This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.
You can apply if you’re a self-employed individual or a member of a partnership and you:
• have submitted your Income Tax Self-Assessment tax return for the tax year 2018-19
• traded in the tax year 2019-20
If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.
Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. This is determined by at least one of the following conditions being true:
• having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
• having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period
If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.
2. Business rates
A business rates holiday will be introduced for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.
The business rates holiday will also be available to eligible nurseries in England for the 2020 to 2021 tax year. Further guidance for local authorities is available in the nursery discount guidance.
Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by their local authority as soon as possible.
Further guidance for local authorities is available in the expanded retail discount guidance.
3. Grant funding
Cash grants for retail, hospitality and leisure businesses
The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.
Businesses in these sectors with a property that has a rateable value of £15,000 and under will receive a grant of £10,000.
Businesses in these sectors with a property that has a rateable value of between £15,000 and £51,000 will receive a grant of £25,000.
Support for businesses that pay little or no business rates
The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.
Although you do not need to do anything as your local authority will write to you if you are eligible for this grant, we would strongly advise that you contact your local authority with details of your business rates and bank account.
Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to your local authority.
To find out who your local authority is please click on this link (Find your local authority) and enter your business postcode.
Further guidance for local authorities is available on administering the business grant schemes.
4. Business Interruptions Loans
The temporary Coronavirus Business Interruption Loan Scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.
The government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.
The government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The scheme will be delivered through commercial lenders, backed by the government-owned British Business Bank.
There are 40 accredited lenders able to offer the scheme, including all the major banks.
The full rules of the scheme and the list of accredited lenders are available on the British Business Bank website.
5. Support for businesses who are paying sick pay to employees
All UK small or medium-sized businesses with fewer than 250 employees as of 28 February 2020 will be eligible to reclaim 2 weeks’ Statutory Sick Pay (SSP) paid for sickness due to COVID19, per eligible employee.
Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website
Eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force.
The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible.
6. Flexibility on tax payments deadlines
The second payment on account for income tax due by 31st July 2020 will be deferred to January 2021.
If your tax is overdue and you are experiencing cashflow difficulties due to the Coronavirus, please contact the HMRC (0800 0159 559) for “Time to Pay Scheme”.
7. Support for businesses through the Coronavirus Job Retention Scheme
Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.
Employers will need to:
- designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation;
- Both employees and the employer must agree to this scheme;
- submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required);
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.
The employer is not obliged to pay the balance of the 20% and is entirely at the employer’s discretion.
If your business needs short term cash flow support, you may be eligible for a Coronavirus Business Interruption Loan.
8. VAT deferment
All UK businesses will be eligible for the VAT deferral which will apply from 20 March 2020 until 30 June 2020.
VAT returns will still need to be submitted on the due dates.
You must cancel the direct debit with your bank if you usually pay your VAT by direct debit. You must do so in good time as HMRC will automatically collect on receipt of your VAT return.
Businesses will NOT need to make a VAT payment during this period. 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.
VAT refunds and reclaims will be paid by the government as normal as long as the VAT returns have been submitted.
9. Companies House filing deadline extension
Businesses will be given an additional 3 months to file accounts with Companies House to help companies avoid penalties as they deal with the impact of COVID-19.
However, please ensure you request the extension before the deadline date online. If your accounts will be late because your company is affected by COVID-19, you can apply for an automatic and immediate 3 month extension to file your accounts.
Late filing penalties: COVID-19
If you do not apply for an extension and your accounts are filed late, an automatic penalty will be imposed. The registrar has very limited discretion not to collect a penalty.
10. Charities Commission filing deadline extension
During the coronavirus pandemic the charity sector will face challenges of looking after its staff, volunteers and trustees who may fall ill, have to self-isolate, or have to look after loved ones. The sector also has a vital role to play in looking after its beneficiaries, many of whom will be amongst the most vulnerable during this public health emergency.
As an immediate step, charities that are due to submit an Annual Return imminently, but feel unable to do so, can call the Charities Commission on 0300 066 9197 to request a filing extension.
11. Protection to commercial tenants from eviction
Commercial tenants who cannot pay their rent because of COVID-19 will be protected from eviction.
These measures will mean no business will automatically forfeit their lease and be forced out of their premises if they miss a payment up until 30 June.
There is the option for the government to extend this period if needed.
This is not a rental holiday. All commercial tenants will still be liable for the rent. Commercial tenants are protected from eviction if they are unable to pay rent.
12. Extension on MOT for 6 months from 30th March 2020
From 30 March 2020, MOT due dates for cars, motorcycles and light vans will be extended by 6 months. This is being done to help prevent the spread of coronavirus.
There’s separate guidance about what to do if your MOT due date is up to and including 29 March 2020.
13. Commercial insurance
Most commercial insurance policies are unlikely to cover pandemics or unspecified notifiable diseases, such as COVID-19.
However, those businesses which have an insurance policy that covers government ordered closure and pandemics or government ordered closure and unspecified notifiable disease should be able to make a claim (subject to the terms and conditions of their policy).
Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers.