Category: Funding

The small business grant - are you eligible

Claim Your Small Business Grant – TODAY

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Claim Your Small Business Grant – TODAY

If your business is eligible for small business rate relief OR rural rate relief:

Your local authority will provide you with a one-off grant of £10,000. (So, doesn’t need to be paid back).

If you are a retail, hospitality or leisure business:

The government is giving you a payment holiday for your business rates for the 2020/2021 tax year. This will be administered via your local authority. If your business received the retail discount in 2019/2020 tax year, your local authority will rebill you as soon as possible. A £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises with a rateable value between £15,000 and £51,000. Your local authority will be able to tell you whether you are eligible and how to claim

Small businesses in Suffolk urged to access £200m pot of COVID-19 aid

Eligible businesses across Suffolk are being urged to access grants of £10,000 or £25,000 to help them through COVID-19 crisis.

The Government has allocated over £213m to support qualifying businesses in Suffolk who are struggling because of restrictions in place to combat the Coronavirus.

There are over 15,000 eligible businesses across the county who can access one of two grants of either £10,000 or £25,000 to help with their ongoing business costs.

To access the schemes, please visit the corresponding Local Authority:

Babergh & Mid Suffolk: www.midsuffolk.gov.uk/business/business-rates/grant-funding-schemes/

East Suffolk Council: www.eastsuffolk.gov.uk/business/covid-19-business-grant-funding/

Ipswich Borough Council: www.ipswich.gov.uk/businessratesgrant

West Suffolk Council: www.westsuffolk.gov.uk/c19business

Business Interruption Loan update

Business Interruption Loan Update

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Business Interruption Loan Update

We don’t have full details yet, but we wanted to let you know that the Coronavirus Business Interruption Loan (CBIL) Scheme is going to be revamped after it has come under considerable criticism.

And this is very positive news for small businesses. As a firm we were personally very disappointed with how the CBIL was being offered and administered by the banks. We believe the following changes will now be implemented (but will confirm in due course)

  1. The loans are available to businesses who have not been refused a commercial loan
  2. The interest rate of the loan after the 1st 12 months interest free are likely to come down from some of the eye-watering rates we had seen quoted. (30%!!!!) But there is still no cap on interest rates from the banks for these loans.
  3. For loans up to £250,000, business owners will not have to supply personal guarantees against their own savings or property.

If you are thinking of accessing the CBIL scheme or a commercial loan scheme or any other type of borrowing, please get in touch as we can help you through the process.

As with any kind of formal borrowing, you will need:

  • Your books fully up-to-date
  • Up-to-date management accounts
  • Projections and forecasts for the business

When more details are available next week, we will be in touch.

Electrician and number 1

What help is there for the Self-Employed?

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What help is there for the self employed?

It seems that every day the realities of the situation the economy is in just gets worse. I am sure you are like us you are pleased that the government is pumping money into small businesses. But what happens if you are self-employed or trade as a sole trader rather than limited business?

So, included in this blog is a summary of what help is available for you if you are self-employed or worried about your personal financial affairs.  We are monitoring this closely and will be in touch once we know more.

Universal Credit 

Universal Credit is a monthly payment to help with your living costs. It is available for anyone, even if you are self-employed. But as always you need to meet fairly specific criteria; namely you are on a low income or out of work.  If you’re expected to look for and be available for work, then it needs to be identified whether you’re ‘gainfully self- employed’.

Gainful self-employment means that:

  • your main employment is self-employment
  • you have self-employed earnings
  • your work is organised, developed, regular and in expectation of profit

As you would expect, you must provide evidence about your business and what you are earning through your business.

Money tree in hand

If you’re gainfully self-employed, your Universal Credit payment may be calculated using an assumed level of earnings, called a Minimum Income Floor.  It’s based on what an employed person on minimum wage would expect to earn in similar circumstances. If you earn more than this, then your Universal Credit amount is based on your actual earnings. If you earn less, the Minimum Income Floor is used to work out how much you can get. You may need to look for additional work to top up your income.

To check if you are eligible for Universal credit go to: https://www.gov.uk/self-employment-and-universal-credit

Mortgage Repayment

From 17th March you can ask for up to a three-month repayment deferment on your mortgage to give you some breathing space. This deferment applies to homeowners and buy-to-let landlords, to allow them to pass on the payment reduction or deferment to their tenants. It will not affect your credit score. However, you must agree your repayment deferment with your bank, otherwise you may skip a payment and it will show a default on your credit score. Please speak to your bank if you want to organise a deferment on your mortgage.

House key ring

Talk with your network and get creative

Now is not the time to lie low. Now is the time to get talking to your network. Firstly pick up the phone, otherwise email or message via social media. They may be aware of some opportunities for you to generate some work. Now, is also the time to be creative with your skill set. For example, if you run a hospitality business and can’t work from home, how about offering skype one-to-one cooking classes?

Event cancellations

If you lost money due to an event being cancelled the outline is:

  1. Contact the organiser first
  2. Organisers that postpone events don’t have to refund until they announce the new date
  3. Ask your ticketing platform about refunds
  4. If you are struggling to get a refund then your credit card provider could help with a refund

You might not get all of your money back – but it’s worth fighting for.

Event plan written on notepad

Time to Pay Arrangement

Lastly, a dedicated Helpline has been set up to help businesses & self-employed in financial distress and with outstanding tax liabilities. Call this helpline to be able to agree a bespoke Time to Pay arrangement with HMRC. This is where you agree with HMRC a bespoke payment plan for your outstanding tax liabilities. If you are concerned about being able to pay your tax due to COVID-19, talk to us first as we can help you plan your call to HMRC’s dedicated helpline on 0800 0159 559.

July 2020 payment on account

As announced on Friday you could defer this payment but as it is 22 March, I would keep this option on the back burner as you may still have to pay it in January 2021, it is effectively a loan.

VAT Deferment

VAT on ipad

We do not know enough about this, but again it is a deferred loan that may help you now.  If you are going to take advantage of this “loan” I would take it, put it in the bank and pay it back once business is back as usual, treat it like a quick safety net but it is a loan.

Our Advice

As your accountants we can help you as part of our service (no extra charge at all!) we can help you to plan initially for the next four months by looking at your business online and helping you to forecast.  We can also negotiate with HMRC or the banks for you and anyone else that you want us to, we are here to help.

I would also suggest that you list all of your household bills including leisure time (restaurants, shopping etc) and make decisions about what you are paying for, again we can help.

Once we have done that the next step is to Plan Plan Plan and Plan even more.  We will all get through this together and once we are back to business in full with the right planning and staying on top of your business you will without doubt be stronger and in a great position to thrive.

1 Accounts Piggy Bank on books

The Ultimate Guide to the Different Types of Business Financing

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The Ultimate Guide to the Different Types of Business Financing

Small business loans are being approved at an unusually high rate, making this the perfect time to increase your company’s cash flow via business financing. There are different kinds of business loans available, and it’s important to know the differences between them in order to make a fully informed decision.

This article will cover some of the most common types of small business loans, such as term loans, and help you understand the benefits and disadvantages of each. From there, you’ll be able to find the perfect financing option for your company’s short and long-term goals.

1 Accounts finance laptop piggy bank

Business Term Loans

Business term loans are one of the most common varieties, giving borrowers a fixed sum of money to be paid back over a given term. You’ll need to meet certain requirements to receive a business loan depending on your location and lender.

Business term loans don’t require any collateral, and they can be used for any business-related purpose. Your interest rate will be based on a variety of factors related to your company, including financial health, monthly or yearly revenue, and your business credit score.

Small Business Administration Loans

SBA loans are backed in part by the government, allowing lenders to charge lower interest rates and have assurance that they’ll receive payment. Depending on the size of your loan, the maximum interest rate for an SBA loan ranges from 7.75% to 10.25%.

Like business term loans, Small Business Administration loans work for essentially any business purpose. it’s important to note that you’ll need a strong credit history to qualify for and receive an SBA loan.

Business Line of Credit

Unlike a conventional loan, a business line of credit works more like a personal credit card. You’ll be able to use your new line of credit at any time up to your credit limit, and you can continue to withdraw again once you’re caught up with your existing payments.

It’s generally easier to qualify for a business line of credit than for a more traditional form of business financing, but there are some other factors to consider. Missed payments carry a heavy penalty, for example, and lenders may ask for collateral.

Invoice Factoring

Invoice factoring is a quick way to free up cash flow for your business, and it’s especially effective for companies dealing with late payments. It involves selling off unpaid invoices to a factoring company who then takes on the responsibility for collecting the cash.

Depending on the terms you arrange for your own invoice factoring, you may receive an advance of anywhere from 60 to 100 percent of the total value. It’s important to note that unlike the other items on this list, the amount you can gain from invoice factoring is limited by your current pending invoices.

Equipment Financing

You can use any kind of business loan to finance more equipment, but equipment financing makes this process much cheaper by using the equipment itself as the loan’s collateral. You’ll get a significantly lower interest rate with equipment financing, even if your business has a poor credit score.

In general, you can use equipment financing to take out a loan of any amount up to the cost of the equipment you’re receiving. This equipment is yours to use as soon as you sign onto the loan, making it an immediate solution for companies with growing equipment needs.

The main downside of equipment financing is its attachment to the equipment itself. If you use this method to acquire a piece of equipment which becomes obsolete quickly, you’ll still be on the hook for the loan without a way to get that money back. Only use equipment financing if you’re confident in the equipment’s viability and longevity.

Merchant Cash Advance

Merchant cash advances are another great option for companies who don’t have the credit score necessary to receive other kinds of financing. A merchant cash advance gives you cash up front which is repaid as a percentage of what you spend on your credit card.

This method of repayment gives merchant cash advances a flexible time period for repayment, so you won’t have to worry about making payments on time each month. That said, interest rates are typically higher than those available with other kinds of financing.

Depending on the specific lender, you should be able to find merchant cash advance opportunities with borrowing limits as high as $250,000. Expect to pay the loan off in roughly six to eighteen months.

Business financing is a crucial aspect of achieving short-term growth and long-term stability for any small business, and there are several options available to immediately increase your cash flow. With more than a few choices, this is a great place to start if you’re looking for a way to help your company expand.