COVID-19
COVID-19 – Coronavirus - HMRC’s Business Support 
 
Here is a quick summary of the measures set out by the Chancellor to date in the Government’s attempt at helping businesses and employees to survive financially in this current crisis. More informationa and guiidance is emerging daily so we will update the information below regularly.  
We are here to support you and your business, never more so than now. To access HMRC's up to date guidance go to https://www.gov.uk/government/collections/financial-support-for-businesses-during-coronavirus-covid-19 
 
1. Job Retention Scheme 
• All UK businesses are eligible for the Scheme. 
• All UK employers with a PAYE scheme will be able to access support to continue paying part of their employees’ salary for those that would otherwise have been laid off during this crisis. 
• HMRC will reimburse 80% of the salaries of “furloughed” workers wage costs, up to a cap of £2,500 per month. £2,500 will be the gross amount and that tax and National Insurance will still be payable. 
• The scheme will cover the cost of wages for up to 4 months at which point it will be reviewed and extended if necessary. NB – as of 12th May this has been extended in its current capacity until 31st July. 
• On 12th May the chancellor announced that the furlough scheme would continue until October but with amendments for returning to work part time and for employers to cover some of the furlough cost themselves. 
• Employers must set out which of their employees are “furloughed workers” and inform the particular employees. 
• By changing the employee(s)’s status to “furloughed workers”, the employer is changing their employment status and remains subject to existing employment law, and depending on the employment contract, may be subject to negotiation. 
• In simple terms, the employees are still on the payroll and in employment for the furloughed period 
• They will resume their previous status after the “furloughed” period. 
• If you need further advice on amending employment contracts and making agreements with staff, please contact your solicitor. Alternatively, we will be able to refer you to one of our trusted affiliates with expertise in employment law/human resources. 
• HMRC launched an online portal for reimbursement on 20th April and businesses are receiving funds within 6 days of making a claim. 
• They have confirmed that the payment of salaries will be backdated to 01st March 2020. 
• If you have insufficient cash to pay your employees in the meantime, you may be eligible for a Corona Virus Business Interruption Loan – please refer to section 8. 
• For directors of close companies, who typically take a monthly salary and draw dividends during the year 80% of the salary which goes through PAYE can be claimed. 
• It is noted that, once an employee is “furloughed”, they can’t do any work for the same employer. It is not clear whether they can do any extra work for anyone else (that would also depend on the stipulations in your contract of employment). 
 
2. Deferring VAT and Income Tax payment
VAT 
• Deferral for the payment of VAT will apply from 20 March 2020 to 30 June 2020. 
• You do not need to make payment towards VAT liabilities in this period. 
• You should consider carefully whether you could possibly afford to continue doing so during this period, noting that the liability is deferred until 31st March 2021, not reduced. 
• The deferral will be automatic although if you currently have a direct debit in place, you should cancel the direct debit with your bank in sufficient time to stop HMRC automatically collecting on receipt of your VAT return. 
Income Tax 
• The 2019/20 payment on account due under the self-assessment system, payable by 31 July 2020, can be deferred until 31 January 2021. Interest and penalties will not be applied. 
• If you are in financial distress and are unable to pay other outstanding tax liabilities, you can contact HMRC on a dedicated helpline: 0800 0159 559 and discuss this with HMRC. They will review on case-by-case basis. 
 
3. Statutory Sick Pay Relief Package for small and medium sized businesses (SMEs) 
• Employers will be able to claim for statutory sick pay (SSP) paid for sickness absence due to COVID-19. 
• Employees do not need a letter from the GP. 
• Applies to all UK employers with fewer than 250 employees as at 28 February 2020; 
• HMRC are working on their system (an online portal) for employers to enact this reclaim. It is not yet available. 
• If you are a director of a limited company, you can pay yourself two weeks of SSP if you need to self-isolate subject to meeting the minimum payroll requirements for SSP. 
• The government will refund £94 per week, maximum £188, to your company. 
• SSP due to COVID-19 to be paid up to two weeks (14 days). 
• If you are a director of a closed company, you can sign off yourself for two weeks self-isolation and can claim SSP at £94 a week. 
• HMRC is developing the portal to claim and for HMRC to repay this SSP and it is not yet available. 
 
4. There will be a 12 month business rates holiday for all businesses
In England, in the following industries; Retail, hospitality, leisure and nursery providers. This will commence 1 April 2020 and will cover the 2020-2021 tax year. 
Eligibility: 
• Your business is based in England. 
• Your business is in retail, hospitality and/or leisure sector, nursery provision 
Properties that will benefit from the relief will be occupied properties that are wholly or mainly being used: 
• As shops, restaurants, cafes, drinking establishments, cinemas and live music venues 
• For assembly and leisure 
• As hotels, guest & boarding premises and self-catering accommodation 
• Providers of Ofsted’s Early Years Register and mainly used for the provision of Early Years Foundation Stage 
You do not need to do anything. The local authorities will apply relief to your next council tax bill if your business is eligible. 
 
5. Small business grant funding of £10,000 for all businesses in receipt of small business rate relief or rural rate relief 
Small businesses which get small business rate relief, including those in retail, hospitality and leisure will receive a cash grant of £10,000. 
You do not need to do anything. Your local council will write to you if you are eligible for this grant. 
Any enquiries on eligibility should be directed to the relevant local authority. 
The link to find the local authority is below: 
https://www.gov.uk/find-local-council 
 
6. Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000 
Cash grant up to £25,000 per property 
For property with rateable value from £15,000 to £51,000. 
Eligibility: 
• Your business is based in England. 
• Your business is in retail, hospitality and/or leisure sector 
Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used: 
• As shops, restaurants, cafes, drinking establishments, cinemas and live music venues 
• For assembly and leisure 
• As hotels, guest & boarding premises and self-catering accommodation 
You do not need to do anything. Your local council will write to you if you are eligible for this grant. 
Guidance from HMRC to local council on the grant can be found on the link below: 
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/875348/small-business-grant-fund-and-retail-guidance-v2.pdf 
 
7. The Corona Virus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through British Business Bank 
• If your business has a shortage of cash, you may want to look at the Coronavirus Business Interruption Loan Scheme for loans up to £million and for up to 6 years. 
• The government will 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 payments. 
• Whilst all borrowing should be carefully considered, this is an option if you have a short term cash flow issue whilst waiting to reimbursement for payments to furloughed employees under the Job Retention Scheme. 
• To be eligible, your business needs to be UK based with turnover under £45 million and meet the other British Business Bank eligibility criteria. Link below: 
https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/accredited-lenders/ 
• Please note that to be eligible for the loan, the business still need to satisfy the lender’s requirements. The lender will need to be satisfied that, were it not for COVID-19, the borrowing proposals would be considered viable by the lender, and they believe that by providing your company the finance will enable your business to trade out of any short-to-medium term difficulty. 
• We can help with providing any financial information for your business as required by the lender(s). 
• Most of the mainstream banks are in the lender list and you can consider going to your bank for an initial conversation about the possibility of a loan under the Corona Virus Interruption Scheme. 
• This scheme was extended on 27th April with the announcement of ‘bounceback’ loans of up to £50k 100% backed by the government. 
• Please get in touch if you need anything from us in support of your loan application. 
 
8. A new lending facility from the Bank of England has been set up to help support liquidity among larger firms, helping them bridge cashflow disruptions due to the coronavirus crisis 
• This applies to non-financial large companies. 
• The government will buy short-term debt from larger companies. 
 
9. The HMRC Time To Pay Scheme 
All businesses and self-employed people in financial distress and with outstanding tax liabilities may be able to get support through HMRC’s Time To Pay service. 
Please contact HMRC’s dedicated helpline on 0800 0159 559 HMRC will consider on case-by-case basis 
 
10. Self-employed Income Support Scheme 
HMRC updated their guidance on the Self-employed income support grant on 4 May. The link to the guidance and the eligibility checker are here 
https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme 
 
We strongly suggest that you bookmark this as it is updated regularly (including at least once since ewe started drafting this email) and should eventually have a further link which will take you to the claims system once it is open (see below). It appears that using the eligibility checker tool will result in you being given a time window for being able to make your claim, so we suggest that everyone who can use that tool does so. 
 
We would hope that HMRC will make contact with you directly before the claims system opens, but the language coming from HMRC at the moment suggests that the responsibility for checking eligibility to the scheme has switched from them to you. In addition, the date has been brought forward to 13 May so we wanted to keep our clients abreast of things, as we currently understand them. 
 
Please read the Guidance from HMRC as there is some very important information in there. There are a few particular points that have prompted us to get in touch, and to which we wanted to draw your attention now; 
 
• The scheme will be open for online claims from 13 May. 
• The indication is that funds will then be made available within 6 days of the date of the claim. This is somewhat earlier than the ‘June’ date which the Chancellor had previously suggested. 
• HMRC have confirmed that Accountants and tax agents will NOT be able to complete claims on behalf of individuals, and we understand that this may be of concern to some of our clients. 
• Apparently the claims process has been designed to be relatively simple. The only information you will require to make the claim is your UTR and National Insurance number (both of which can be found on the front of your Tax Return) and bank details. We expect you will be asked to confirm that your income has been impacted by Coronavirus. 
• You will need to have your own Government Gateway account set up in order to make a claim, which you won’t necessarily have if we complete Tax Returns for you. 
It may be worthwhile getting a head start and setting up the Gateway account prior to 13 May, as we expect internet traffic to HMRC to be very heavy on that day. 
• There is an eligibility tool within the updated guidance, and you should be able to check your eligibility for the grant and set up your Gateway Account at the same time. 
For those of you who have set up an account recently, for example to claim Universal Credit, we think that you will be able to make the claim for your income support grant using the same account. 
• We would also remind you that the grant will be counted as taxable income so you should record it in your trading income records in the usual way. 
 
For those of you who do not think you will be able to use the online system to claim the grant, we are told there will be another means to do so but we don’t yet have details on that. Please let us know if you think you will need to claim in a different way and we can then update you once further information is known and help you as far as is possible. 
 
It will almost certainly take more time for the funds to come through so if you possibly can set up a Gateway Account and claim online we would suggest doing so. 
 
11. Other information 
• Companies 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. 
• Companies need to make an application to Companies House. 
• Please call us if you wish to consider extending your filing deadline. In many cases this may not be necessary but we can discuss this and help you apply if need be. 
• The government’s £500 million Hardship Fund will provide council tax relief to vulnerable people and households to help those affected most by coronavirus. Funding will go to local authorities in England to enable them to reduce the 2020 to 2021 council tax bills of working age people receiving Local Council Tax Support 
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