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Government aid for Channel? A rough guide

Channel businesses are scrambling to see what the government’s aid package mean for their business right now. The Government has done a fantastic job of producing support for businesses across the board but what often happens with these broad brush measures is some businesses will inevitably fall through the cracks. The industry is currently in discussions on how they support businesses themselves, organising payment holidays and trying to be flexible with contractual terms.

If you are a reader of Comms Business and need some help please get in touch – David.Dungay@MarkAllenGroup.com

 

Below is a short guide to some of the schemes in place that could support your businesses.

Coronavirus Job Retention Scheme

The scheme is open to all UK employers for at least 3 months starting from 1 March 2020. Employers can claim for 80% of furloughed employees’ usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage.

Furlough

What is it? – In a bid to keep people employed being in furlough basically means you are on a leave of absence but you are guaranteed 80% of your usual salary. Employees MUST NOT engage in any working activity throughout this period.

Why put people in furlough? – To preserve your cash. Companies seem to be adopting two approaches to Furlough. Either putting a large amount on furlough leave with the anticipation that staff will be brought back into the company when they are needed or waiting for demand for services to dictate who to Furlough.

Employers must:
•Designate employees who cannot do their jobs due to the coronavirus measures put in place by the Government
•Notify those employees of their new “furloughed” status
•Submit information to HMRC about furloughed employees to set up a system for reimbursement and existing systems that will facilitate payments.

More information here

NOTE: Employees in furlough MUST NOT engage in working activity. This could be considered fraud by HMRC.

VAT and Self-Assessment deferral

VAT registered businesses in the UK that have a VAT payment due between 20 March 2020 and 30 June 2020 can either defer the payment until a later date
How? – More Information Here.

The Self-employment Income Support Scheme

This one had been a kick in the teeth for many Channel businesses. To be eligible you must have submitted a Tax Self Assessment tax return for the year 2018-19, traded in the 2019-20 tax year AND have trading profits of less than £50,000.

The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) who have lost income due to coronavirus (COVID-19).

This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.

More information 

Sick Pay Support

Small and medium businesses can reclaim Statutory Sick Pay (SSP) paid for sickness due to Coronavirus. The refund covers up to two weeks per eligible employee. Only employers with less than 250 employees are eligible. Ensure you keep strict records of staff absences, the mechanism for payment to employers is still being considered.

More information here

Coronavirus Business Interruption Loan Scheme

Good news if you turnover less than £45million. The temporary scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.
A Business Interruption Payment scheme will also cover the first 12 months of interest payments and any lender-levied fees.

The scheme is delivered through commercial lenders, backed by the government-owned British Business Bank. There are currently 40 accredited lenders available.

HMRC Time to Pay Scheme

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

Commercial Tenant protection

Commercial tenants that can’t pay rent because of the health crisis will be protected if they miss a payment up to the 30th June (this may be extended). Tenants will be protected from eviction during this period and will not forfeit their lease.

This is NOT a rental holiday. All commercial tenants will still be liable for the rent. Commercial tenants are protected from eviction if they are unable to pay rent.

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David Dungay

Editor - Comms Business Magazine