COVID-19 Business Support
Friday 20th March 2020
Think Smart Support...
Firstly, if you are in an industry that has been severely affected already (travel, tourism, hospitality etc) we will be on hand to help in any way we can with more targeted advice or just to act as a sounding board. Please get in contact sooner rather than later if you need any help with anything going on that we can possibly support you with.
We are all now working from home. We have always had this as an option, so this is nothing new to us and is now more important than ever that we have the capability to do so. All team members have remote access to our systems and files using cloud-based technology with 2FA security. Please contact us in the first instance via normal methods, we will get back to you as soon as possible if unable to pick up or respond immediately.
Please note that due to other family members being in the same boat as us, our home working environments may not be as quiet an undisturbed as normal!
For those of you that routinely have paperwork, please contact us in advance of any drop-offs so that we can ensure this is done as efficiently and safely as possible. We will also work with you to set up remote scanning by app or other methods where possible.
All meetings going forward will be moved to the telephone or via MS Teams. We'll ask what you prefer when we book the appointment.
Talking to several clients this week it is clear the community is already experiencing cancelled orders/events/contracts, supply chain issues and some challenges with cashflow.
This advice is a moving target so it is as up to date as it can be at the time we write this email. In order that we keep this information as up to date as possible and include links to relevant government (and others) support/guidance, we will be posting updates on our webpage as often as we can. This will include business advice as well as any personal help that may be of benefit to your employees.
Review your overheads
If you are predicting cashflow difficulties it is sensible to review your overheads in the business and pause any expenditure you feel may not be necessary at this time. The first thing to do is categorise expenditure (both personal and business) into "essential" and "nice to have". Once you have those numbers you can better appraise your situation and we can support you further with short term cash flow forecasts.
Your own Bank
Contact your own bank, either your dedicated manager if you have one or your business call centre Discuss your options should you need a new or increased overdraft limit, asset finance, credit cards or other forms of temporary finance.
Other potential funding sources
Please note these are only a few of the options available to you and these do not form a recommendation by Think Smart Accounts.
Capital On Tap
NatWest Rapid Cash
AMEX/PayPal & other credit card companies often offer business loans so if you have accounts with them, please contact them as well if needed.
Turning now to the Government support...
In the Budget 2020, the Chancellor announced that a 'Coronavirus Business Interruption Loan Scheme' (CBILS) will temporarily replace the Enterprise Finance Guarantee (EFG), becoming available over the coming weeks.
It will operate in a similar way to EFG and be provided by the British Business Bank, but will offer more attractive terms for both businesses and lenders, with the aim of supporting the continued provision of finance to UK businesses during the Covid-19 outbreak.
As it stands, we do not know any more than this. More information will be available in the coming days and weeks, please click on the link here for updated advice
HMRC and Time to Pay
HMRC have launched a helpline to help businesses concerned about paying their tax due to coronavirus (COVID-19). Again, this appears to be a "work in progress". You will find more details here, but if you have any concerns about making payment to the tax authorities please call us immediately for support.
Further advice & links to help here
Some updated information to clarify some uncertainties around the various help for businesses from our tax partner David Logan is as follows:
The Chancellor, Rishi Sunak, outlined a raft of further measures last night to support the UK's ailing businesses, those affected by the forbidding COVID-19 outbreak. The list that follows summarises his announcements in the order they were announced:
• The Treasury are making available £330bn of loan guarantees. These guarantees will underpin government backed bank loans on attractive terms. The loans can be used to support businesses through financial difficulties during the COVID-19 crisis. Note they are loans. At some point interest will be charged and repayments will have to be made. The Chancellor confirmed that if this level of support was insufficient, further guarantees would be forthcoming.
• Support for liquidity to larger firms will be provided by low-cost, easily accessible commercial paper. Support for smaller firms will be accessed via the Business Interruption Loan Scheme previously announced - the initial loan ceiling of £1.2m is to be increased to £5m and no interest due for the first six months. Both of these schemes are due to be up and running by the start of next week.
• Further measures are to be introduced to support airlines. No details as yet.
• Businesses in the hospitality, leisure and retail sectors who have made claims for business interruption from their insurers due to government interventions, may have had difficulties making a claim. Government have now intervened, and the insurers have agreed to pay up in appropriate cases.
• Businesses in the retail, hospitality and leisure sectors with a rateable value below £51,000, will also receive - in addition to the 100% rates relief previously announced - a cash grant of up to £25,000 per business.
• In the same sector, the 100% rates reduction will be applied to all business irrespective of rateable value.
To clarify, the previous two bullet points mean that all businesses in the retail, hospitality or leisure sector - shops, pubs, theatres, music venues, restaurants etc - will have no rates to pay for 2020-21, and if the rateable value of their property is below £51,000, they may also be able to claim a cash grant of up to £25,000.
• The £3,000 grants to smaller business, announced last week, are to be increased to £10,000.
• Mortgage lenders have agreed with government that individuals disrupted by the Coronavirus can have at least a three-month holiday from making mortgage repayments. See below for latest infomation link on this.
The Chancellor also hinted that there would be further support for incomes and jobs. Perhaps an increase in statutory sick pay or increased access to State Benefits. Watch this space.
What is not clear is how we claim for the various loans and grants on offer. We offer the following suggestions although the actual processes finally agreed may differ from these:
Rates reductions should be made automatically, and revised statement sent by local authorities in the coming weeks for 2020-21. Contact your local rating department to clarify that this is so.
• It is not clear how qualifying businesses will claim the grants mentioned in the above list - those that range between £10,000 to £25,000 - could be applications need to be made to local authorities or another government department. We will confirm as soon as details are released.
• We assume that you will need to apply to your bank for the guaranteed Business Interruption Loan. It is likely that your bank will need up-to-date figures to back up your application. Please call if you need help preparing these.
• At the time this update was composed, the government had still not confirmed how employers can claim back the 14-day cost of Statutory Sick Pay paid to employees. Again, we will publish details as soon as they are released.
Although not part of the Chancellor's presentation, Chief Secretary of the Treasury, Steve Barclay, made a further announcement to parliament on Tuesday 17 March 2020. The government are postponing the roll-out of draconian IR35 measures to the private sector that would have affected the tax status of many incorporated contractors across the UK. This a welcome change as it will defer much disruption in this sector until the worst aspects of the COVID-19 outbreak have passed. The new rules are now slated to come into effect from 6 April 2021, a year later than planned.
Here is a link to information on the 3 month mortgage holiday which may be of help to you & your employees
Official guidance for employers
For HMRC's guidance for employers, please follow the link here
Statutory Sick Pay SSP Support
To support businesses experiencing increases in costs or financial disruptions: -
• The government will bring forward legislation to allow small and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
• The eligibility criteria for the scheme will be as follows:
o This refund will cover up to two weeks' SSP per eligible employee who has been off work because of COVID-19. Employers with fewer than 250 employees will be eligible.
o The size of an employer will be determined by the number of people they employed as of 28 February 2020. Employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19.
o Employers should maintain records of staff absences, but employees will not need to provide a GP fit note.
o The eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to self-isolators comes into force.
o The government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible. Existing systems are not designed to facilitate employer refunds for SSP.
The information above has been taken from this source
Again, it is unclear how this will be organised and how quickly the payroll software will catch up with the situation. (Live update 9:30 am 18/03 - Brightpay have announced their workaround is to mark the previous 3 days as sickness in statutory calendars making the 1st day effectively the 4th day & therefore payable under SSP)
If we are currently running your payroll, we will manage the software side of things and will just need all of the relevant information from you for processing.
We are more than happy to discuss your individual circumstances and advise on the best way forward.
We appreciate these are unprecedented and challenging times to be in business and we all face a period of uncertainty. No one can predict the future but we believe we can all pull together as businesses and support each other.
The Think Smart team are here to help you. If you need a sounding board, some advice or a steer in the right direction, then please don't hesitate to get in touch.
In the meantime, stay safe and well. Our best wishes are with you all during this unprecedented situation.
Jane, Catherine & Andy
Think Smart Accounts Ltd