Covid 19 Business Support
Companies across the UK are dealing with unparalleled challenges as the enforced closure of premises and strict social distancing measures slam the brakes on business as we know it in the wake of the escalating coronavirus crisis. At H& Associates we have all the tools and knowledge to help companies at this time.
The UK government has introduced an unprecedented combination of measures to support businesses. One of these is the CBILS, a temporary replacement of the existing Enterprise Finance Guarantee Scheme, which will give companies easier access to both mainstream funding as well as smaller specialist lenders. Security to the lender will be provided by the government who will guarantee 80% of the amount borrowed.
- Borrow up to £5m
- No interest payable for the first 12 months
- Government will provide security for 80% of the loan amount
- Responsibility for repaying the loan or finance facility remains with the borrower
- Range of funding options including loans as well as asset and invoice finance
- Funding from high street banks as well as specialist lenders
- Over 40 accredited lenders taking part in the scheme
- Borrowing through CBILS was made available as of Monday 23 March 2020
What type of borrowing is available?
- Access to a range of revolving and term finance options including:
- Business loans and asset finance (terms of up to ten years)
- Invoice finance and revolving facilities (terms of up to three years)
Is CBILS right for my business, and do I qualify?
- Eligibility is limited to companies with an annual turnover not exceeding £45 million
- Only available to those without adequate security to obtain funding directly from the lender under ordinary circumstances. If your company meets the banks existing lending criteria, then borrowing must be done in the normal way
- Must have a ‘sound borrowing proposal’, which would be considered viable by the lender outside of current conditions
- Lender must be convinced the borrowing will help the company trade out of the current situation and remain in business in the long term
- Funding will not be granted to prop up an already failing business
Self-employment Income Support Scheme
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.
Time to Pay service
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.
The coronavirus job retention scheme enables businesses to continue paying part of their employees’ salary who would otherwise have been laid off because of the crisis.
The Government will cover 80 per cent of salaries up to a ceiling of £2,500 a month – equivalent to the UK average wage of £30,000 a year.
Which businesses can apply?
Any company with employees can apply, including charities, recruitment agencies and public authorities.
However, the Government does not expect many public sector organisations to apply, as ‘the majority of public sector employees are continuing to provide essential public services or contribute to the response to the coronavirus outbreak’.
Organisations who are receiving public funding specifically to provide services necessary to respond to the coronavirus outbreak are not expected to furlough staff.
Employers can furlough staff for a minimum of three weeks and are not allowed to rotate employees on furlough.
In order to access the scheme, businesses need to change the status of their employees to furlough workers and submit the information to HMRC.
HMRC are currently working to set up a system for reimbursing companies.