New Measure to help businesses through the Coronavirus pandemic.
The Government has announced a lot of measures to help businesses through the coronavirus. As most of the ones announced at the Budget came through the tax system I’ve been looking at them in some detail, although things have now moved on. This update is to let you know where we are at the moment.
We had a call this morning to work out where we stand in UK200Group. We’ve identified a few things that need doing: this email is one, and other stuff will be coming out shortly.
The help available is in a number of forms:
- Business rates reductions, and grants for businesses who have low rate bills
- Extending SSP, and allowing employers to reclaim it.
- Time to Pay being extended
- Help with business loans.
The details of none of these is clear yet, but what we do know is:
- Business rates reductions are going through the normal systems, with rates bills being recalculated. They don’t seem to require much action, but equally they don’t seem likely to have much of an immediate impact.
- Grants for small businesses have
been increased:
- £10k for those who get full rates relief (up from £3k in the Budget)
- £25k for hospitality, leisure, and retail businesses, which also get a rates holiday for a year
- The grants are to be administered by local authorities, but details are yet to be released
- Authorities are meant to be actively contacting businesses to let them know how to claim
- The systems are not yet set up, so no cash is coming from here for a while.
- SSP changes mean more workers can
claim it. Small employers can claim it back, but:
- People seem to be very confused as to who can claim SSP due to the virus. Can you claim it if you stay at home because you’re a bit worried, for example?
- There’s no clarity yet on what ‘small’ means. I understand that the best guess at the moment is that the 250-employee limit is per PAYE reference, but that seems rather simplistic and I’d expect HMRC to bring in some sort of grouping provisions.
- It’s academic at the moment as the mechanism is not yet set up. This is to be done ‘as soon as possible’ and ‘over the next few months’. So I wouldn’t rely on getting any cash back from that source in the near future.
- Time to Pay is being extended, and
it looks like HMRC will be a lot more flexible about it. A few points:
- There’s a dedicated line for this: 0800 0159 559
- Interest and late payment penalties can be waived
- Debt collection can be suspended
- We don’t have a feel yet for how long HMRC will spread payments over
- HMRC have generally wanted TTP to be a one-off for any given taxpayer. It’s not clear how many tax bills one will be able to defer or spread under the new regime (but see ‘no debt collection activities’…).
- It’s not clear what happens with existing TTPs.
- The loans are the big one, and as
they’re being delivered through banks they should be the most immediately
accessible. Anecdotal evidence is that banks are getting a lot of
enquiries. Key issues:
- The first 6 months of the interest is to be covered by the Treasury
- 80% of the loan is guaranteed
- Loans can be up to £5m (up from £1.2m in the Budget)
- Burdening businesses with debt will be an issue. How much of this is going to be written off in the end? Will it be like student loans?
We’re talking to HMRC and government centrally to try and get early information, and to help steer them in the right direction. Any thoughts you have which could help there would be appreciated.
Key actions for member firms are:
- Talk to the banks, and see if you can speed up loans for clients
- Talk to clients and make sure you know what help they need, and they know what they can get
- Talk to us centrally, so we know what’s happening on the streets.
