Whether you're employed, or have your own business the government has put schemes in place in order to assist you financially during these unprecedented times. The impact of the first lockdown was significant enough but now we are living through the 3rd lockdown, the financial pressures on individuals and companies is immense! With restrictions and schemes changing on a daily basis, it’s hard to keep up with what’s available. So here’s a low down to help you.
BBLS - The Bounce Back Loan Scheme
The Coronavirus Bounce Back Loan Scheme is in place in order for smaller businesses to access finance more quickly due to the pandemic. The scheme enables small and medium sized businesses to access between £2,000 and up to 25% of their annual turnover, with a threshold of £50,000, the government guarantees 100% of the loan. There will be no fees or interest applied to the loan for the first year and after this time 2.5% per annum interest will be applied. You can apply for this scheme until 31st March 2021.
If you have already taken part in this scheme but borrowed less than your entitlement, you can top up your existing loan, again this has to be done by 31st March 2021. In order to be eligible for this loan you must be based within the UK, your business must have been established before 1st March 2020 and you may have to show evidence to prove that your business has been significantly affected by the Coronavirus.
CBILS - Coronavirus Business Interruption Loan Scheme
This loan scheme is again available for small and medium sized businesses who have been impacted by COVID-19. This scheme enables businesses to access loans and other finance options with an upper limit of £5 million. The government guarantees 80% of the loan and will also cover the first 12 months interest and any fees which may incur. The scheme ends on 31st March 2021. To be able to apply for this loan your business must be based in the UK and have an annual turnover of up to £45 million. You will need to prove that before the pandemic your business was not in any difficulty and that your business has been adversely impacted by the pandemic.
CLBILS - Coronavirus Large Business Interruption Loan Scheme
If you have a medium or large sized business then the CLBILS may give you access to loans and other finance options of up to £200 million. The government will guarantee 80% of the finance and the scheme is open until 31st March 2021. In order to be eligible for this loan scheme your business must be based in the UK and have an annual turnover exceeding £45 million, you cannot have received funding from the Covid-19 Corporate Financing Facility (CCFF). Your business must not have been in financial difficulty before the pandemic and must have been adversely affected by the Coronavirus. If you are borrowing over £50 million you must agree on restrictions on dividend payments, senior pay and share buy-back schemes during the loan period.
Covid-19 Corporate Financing Facility - CCFF
This is a little different to the other schemes. Under this scheme the bank of England will buy short-term debt from large businesses. It will help to support corporate finance markets and ease the supply of credit. The scheme is distributed via commercial lenders and backed by The Bank of England. The scheme will continue for 12 months or for as long as required to relieve cash flow pressures on organisations who make significant contributions to the UK economy.
Coronavirus Future Fund
This scheme is aimed at innovative businesses who rely on financial investment and who are not eligible for other government funding. You will need to prove that your business is facing financial difficulty due to the Coronavirus. Your business must have raised at least £250,000 in equity investments over the past 5 years and have been incorporated on or before 31st December 2019 amongst other criteria. Check your eligibility here. If you are eligible the loan value provided from the government is anything from £125,000 to £5 million. Applications close on 31st January 2021.
SEISS - Self Employment Income Support Scheme
To access this support scheme you must be self employed or in a partnership. You must prove that there has been a reduction in your profits following the coronavirus outbreak, whether that be a new impact or a continuing effect between 1st November 2020 and 29th January 2021.
The next taxable grant is the 3rd so far and worth 80% of your average monthly profits. You will be paid in a single transaction covering you for 3 months with a cap of £7,500. You must claim by 29th January 2021. The money you receive does not need to be paid back but is subject to Income Tax and National Insurance and must form part of your self assessment.
CJRS - Coronavirus Job Retention Scheme (Furlough)
The Furlough scheme first started in February of last year when the first lockdown was introduced. The scheme has been extended until 30th April 2021 and is now flexible. The flexibility allows employers to bring staff back when work is available for them and furlough them again when the workload isn’t as great. It also allows flexibility of hours so that you can bring back staff on a part time basis and they can receive furlough for the hours not worked.
The government will pay 80% of wages for hours not worked, which is capped at £2,500 per individual. In order to claim for December’s furlough you must submit your claim by 14th January 2021.
Businesses who have been forced to close due to lockdown restrictions
Businesses in the retail, hospitality and leisure industries are entitled to a one-off grant worth up to £9,000. This is in addition to the local grants available to businesses who were forced to close due to local restrictions before National Lockdown. The amount you’re entitled to will be determined by your rateable value, see the government website for further information. To get access to local grants contact your local council.
Coronavirus Local Restrictions Support Grant (LRSG) - for open businesses
If your business was placed into Tier 2 or 3 restrictions after 1st August 2020 and was severely impacted due to these restrictions (but remained open), then you may be eligible for a cash grant from your local council for each 14 day period you were put under these restrictions.
The amount of money you will get will be based on the rateable value of the property on the date local restrictions commenced. For example if your property has a rateable value of £15,000 or less you may be eligible for a cash grant of up to £467 for each 14 day period you were under local restrictions. Eligibility is down to the discretion of your local council, see your local council website for further information and to apply for this grant.
Coronavirus Local Restrictions Support Grant (LRSG) - for closed businesses
Businesses that were open as usual before national lockdown restrictions were implemented and forced to close between 5th November and 2nd December 2020 may be eligible for the LRSG (closed). The LRSG for closed businesses entitles businesses to a cash grant for each 28 day period they were closed for under national restrictions. Again the value of this grant depends on the rateable value of your property. If your business has a property with a rateable value of £15,000 or less you may be eligible for a cash grant of £1,334 for each 28 day period your business has been closed for. Seek advice from your local council if you fall under this category.
Coronavirus Additional Restrictions Grant (ARG)
This grant is here to support businesses who are not covered by other grants but require additional funding. If you do not pay your business rates directly to your local council, you have not been forced to close due to restrictions but your business has been impacted, then you may be eligible for the ARG. This scheme is also run by your local council, so get in touch with them to discuss the criteria and your eligibility.
Business Rates Holiday
If your business falls under categories such as Hospitality, Retail, Leisure or you are an OFSTED registered childcare provider for under 5’s, then you will not have to pay business rates for the tax year 2020-2021. You don’t need to take further action, your local council will automatically apply this discount. You can use the online Business Rates calculator to find out what you are owed: https://www.gov.uk/calculate-your-business-rates
It is a financial struggle for so many businesses but with the support which has been made available by the Government we can hope that as many businesses as possible can get through this. Here’s the link to find out more about all the financial support available to you GOV.UK