Last week’s Budget included £7 billion of expenditure targeting the impact of COVID-19 on employees, the self-employed and businesses. Less than a week later a further raft of measures was announced. The new measures amount to an additional £20 billion of support expenditure plus £330 billion of loan guarantees.
The Chancellor’s 17 March Statement was accompanied by a repeated promise that he would do “whatever it takes” to counter the impact of the virus. Further announcements can be expected and we will update you as relevant. We have pulled together a round-up of the key announcements so far for businesses.
Measures for business
Statutory sick pay (SSP)
Businesses with fewer than 250 employees will be refunded the full cost of providing SSP to any employee off work for up to 14 days because of COVID-19.
Loan guarantees
The Chancellor has vastly extended the government-backed loan guarantee scheme revealed in the Budget. The Government will now provide loan guarantees up to “an initial” £330 billion for all sizes of businesses:
• For large firms, the Bank of England is launching a Covid Corporate Financing Facility (CCFF), which “will provide funding to businesses by purchasing commercial paper of up to one-year maturity, issued by firms making a material contribution to the UK economy”.
• For small and medium sized businesses, the loan limit on the Coronavirus Business Interruption Loan Scheme (originally announced in the Budget at £1.2 million) is now £5 million, with no interest due for the first six months.
Both loan schemes are intended to be up and running from 23 March 2020.
Business Rates Retail Discount
All shops, cinemas, restaurants, music venues and business operating in the leisure and hospitality sectors will have no business rates to pay in 2020/21.
On 17 March the Chancellor also promised an additional cash grant of “up to £25,000 per business” to businesses with a rateable value of less than £51,000 – i.e. those that would have benefited from the old version of Business Rates Retail Discount Scheme.
Businesses already eligible for small business rates relief
There will be a flat £10,000 cash grant for each business that already benefits from zero or reduced business rates because of small business rate relief. We understand local authorities will be dealing with payment of these.
Insurance cover
Although the government has not required the leisure and hospitality businesses to close, on 17 March the Chancellor said that “for those businesses which do have a policy that covers pandemics, the government’s action is sufficient and will allow businesses to make an insurance claim against their policy”. Pandemic cover is not a feature of most business disruption cover. You will need to check what cover, if any, you hold.
Time to Pay (TTP)
In the Budget, the Chancellor announced that HMRC would scale up its Time To Pay service. The dedicated HMRC helpline will be manned by 2,000 experienced HMRC staff. For businesses and self-employed individuals who have difficulty with paying their tax due to COVID-19, the helpline can assist with:
setting up a time to pay arrangement,
suspending debt collection proceedings, and
cancelling late payment penalties and (unusually) interest.
The number of the helpline is 0800 0159 559.
Government guidance for employers and businesses is also available on www.gov.uk.