What are the new business support schemes for covid-19?
Yesterday the government announced more support for businesses and the self-employed. This blog takes you through the announcements and what it means for your business.
On the one hand, it is great to see the government making available this help. But this probably means we will see fairly strict lockdown conditions between now and March 2021. We hope we are wrong about this, but in your contingency/scenario planning, particularly in regard to cash, please extend this 4-week lockdown until the end of March. If you need help with your business planning, please get in touch.
Here are the full details from the Government’s announcement.
The Self-Employed Income Scheme
On 30th November you will be able to claim a grant for up to 80% of your profits, to cover you for Nov – Jan 2021. This is capped at £7500. They also declared there will be one more grant which will cover the period Feb – Apr 2021. Details are yet unknown of when this will be paid or for how much.
To receive these grants, you need to have received the previous grants.
The ‘Furlough scheme’
This has now been extended to the end of March. Which in effect means that we are unlikely to see the Job Support Scheme operational… You can Furlough any member of staff, as long as they were on the payroll before Oct 30th 2020. And the government will pay up to 80% of their wages, capped at £2500 per month.
As a result of extending the Furlough scheme the planned Jan 2021 ‘Job retention bonus’ of £1000 for any employee you Furloughed who you still employed has been deferred. Until when? Who knows?
Help with cash flow
If you haven’t taken a Bounce Back Loan or didn’t take the maximum amount available to you, you can now top this up. And you will be able to take out a CBIL or Bounce Back Loan now until the end of Jan 2021.
Mortgage payment holidays for those who haven’t taken a payment holiday will be available for 6 months, without this being noted on their credit files.
Remember that for many businesses the deferred Q2 VAT payments, general tax and self-assessment tax is now becoming due in the next few months. Please get in touch if you haven’t already identified how you will manage your cash to make these payments. We can put you in touch with finance providers or help you organise a time to pay agreement with HMRC.