Coronavirus and your business
Help for sole traders and businesses
The Government has released guidance for employers and businesses on how you should deal with the impact of coronavirus. The guides cover several topics, such as how to help prevent the spread of the virus and what to do if someone in your work force has coronavirus.
The Chancellor also confirmed in a statement on 17 March 2020 that advice given by Government to avoid pubs, clubs and theatres is sufficient for businesses to claim on their insurance if they have appropriate business interruption cover for pandemics in place. Although advice did change and the Government said that many of these businesses had to close, the Chancellor's earlier statement may affect the date from which your insurer pays you.
Help for the self-employed and businesses
The Government has announced the following help for self-employed people and businesses.
Statutory Sick Pay refunds
If you run a business with fewer than 250 people, costs for up to 14 days of Statutory Sick Pay will be refunded for eligible employees who have been off work because of coronavirus.
The online claim tool is now available. For further guidance, including eligibility details, see GOV.UK.
HMRC Coronavirus Helpline
You can call the HMRC Coronavirus Helpline on 0800 024 1222 if you cannot pay your tax bill on time because of coronavirus. You can also continue to use HMRC’s Time to Pay service.
Deferral of some payments to HMRC
Businesses are being given longer to make some payments to HMRC. This includes:
- VAT payments that were due between 20 March 2020 and 30 June 2020;
- Self-Assessment payments on account that were due on 31 July 2020; and
- Self-Assessment that will be owed in January 2021. If you have up to £30,000 of self-assessment tax owing in January 2021, you may be able to use HMRC’s self-service Time to Pay facility to get a payment plan for 12 months. See GOV.UK for more information, including eligibility details.
Late filing daily penalties will not apply for 2018 to 2019 self assessment returns
HMRC has said that daily penalties will not be charged for the late filing of 2018 to 2019 self assessment tax returns. This is because of the difficult circumstances many taxpayers faced due to coronavirus during the time that daily penalties accrued.
Other penalties will still apply and HMRC will expect you to submit any outstanding returns as soon as possible.
Extra time to appeal against some HMRC decisions
If you have been affected by coronavirus, HMRC will give you an extra three months to appeal a tax or penalty decision that is dated 1 February 2020 or later. Send your appeal as soon as you can and also explain that the delay was caused by coronavirus.
VAT rate change for some businesses
From 15 July 2020 to 31 March 2021, the rate of VAT will be cut from 20% to 5% on most tourism and hospitality-related activities and on admission charges for some attractions. For more information, see GOV.UK.
Self-employment Income Support Scheme (SEISS) Grant Extension
The SEISS grant extension covers 1 November 2020 to 30 April 2021. It provides further grants if you are self-employed and:
- were previously eligible for the SEISS first and second grant (although you don't have to have made a claim);
- intend to continue trading; and
- are facing reduced demand due to coronavirus or are temporarily unable to trade because of coronavirus.
The extension provides two further taxable grants that will be paid as separate lump sums, each covering a separate three-month period.
- The third grant will cover 1 November 2020 to 31 January 2021. It provides a grant for 80% of your average monthly trading profits up to a maximum of £7,500.
- The fourth grant will cover 1 February 2021 to 30 April 2021. HMRC has said that it will provide details of the payment at a later date.
For more information, see GOV.UK.
The Coronavirus Job Retention Scheme (CJRS) - Extended
The CJRS was due to close at the end of October 2020, but will now run until the end of April 2021.
If you are finding it difficult to maintain your workforce because your business is affected by coronavirus, you may be able to furlough your employees and apply for a grant to cover some of their wage costs through the extended Coronavirus Job Retention Scheme.
The scheme is available to all UK businesses with a UK bank account and UK PAYE scheme.
- Until the scheme is reviewed in January 2021, HMRC will pay 80% of wages up to a cap of £2,500 per month for the hours that an eligible employee is furloughed.
- You will need to pay the employer National Insurance Contributions and pension contribution.
Claims can be made on GOV.UK from 11 November 2020. Monthly deadlines will apply.
- For claims up to 31 October 2020, the deadline was 30 November 2020.
- For claims after 1 November 2020, the claim must be made within 14 calendar days after the month the claim relates to. For example, an employer claiming a grant for November 2020 must submit the claim by 14 December 2020. If the 14th day falls on a weekend, the deadline will be the following weekday.
- See GOV.UK guidance for a list of monthly submission dates and for information about late applications.
For claims made for the month of December 2020 onwards, HMRC will publish:
- employer names;
- an indication of the value of the claim; and
- the company registration number if the claim is made by a limited company or limited liability partnership (LLP).
HMRC will soon provide information on how to request that they do not publish these details if it would result in a serious risk of violence or intimidation to certain individuals. This includes you, your employees and anybody that lives with you or your employees. For more information, see GOV.UK or contact us for advice.
If you are a director of a limited company and paid as an employee of the limited company through PAYE, the limited company can apply for help from the CJRS if you are furloughed. Our understanding is that a director who is also an employee can furlough themselves as long as they only carry out minor statutory and administrative director duties. You must not provide services or carry out income generating ‘employee’ activities while you are furloughed.
This scheme will not cover any dividends that you receive as a director. So, if you are a director of a limited company, paid as an employee of the limited company through PAYE and also get dividends from the limited company, you will need to decide whether being furloughed is the best option for you. If you are unsure, speak to your accountant or bookkeeper.
If you are a salaried member of a limited liability partnership (LLP), then you may also be eligible for support through the scheme. If you are a member of an LLP and uncertain about whether you are ‘salaried’, or not, check the LLP agreement. You may also need to contact your accountant or bookkeeper.
The Government previously announced that a Job Retention Bonus would be paid for each eligible furloughed employee who is still employed on 31 January 2021. This will no longer be available.
However, Government has said that a retention incentive will be deployed at the appropriate time.
The Coronavirus Business Interruption Loan Scheme
This scheme is open for new applications until 31 March 2021. It allows banks to offer loans to support small and medium sized businesses. The Government will cover the first 12 months of interest payments.
The Government also announced the following changes to the scheme on 3 April 2020.
- All viable small businesses affected by coronavirus issues, and not just those unable to secure regular commercial financing, are now eligible for the scheme.
- Lenders cannot ask for a personal guarantee for loans under £250,000.
For more information about the scheme and a list of lenders, visit the British Business Bank website.
The Bounce Back Loan scheme
This scheme is open for new applications until 31 March 2021. It allows banks to offer loans to support small and medium sized businesses. that have been affected by coronavirus to take out loans of between £2,000 and £50,000.
From 10 November 2020, businesses may be able to apply for a top to an existing Bounce Back Loan if the original loan was for less than the maximum they were entitled to. The maximum loan is the lesser of £50,000 or 25% of turnover.
Bounce Back Loans can offer repayment terms of up to 10 years and no repayments are due for the first 12 months of the loan. For more information about this scheme, including eligibility details, see GOV.UK.
Recovery Advice for Business scheme
The professional and business services sector and Enterprise Nation are offering small and medium sized businesses free advice in the following areas:
- accounting and finance;
- people and building a team;
- planning, strategy and pivoting;
- marketing, PR and social media; and
- technology and digital tools.
Leadership and problem-solving training (England only)
The Government has launched two training programmes which aim to help small businesses recover from the impact of coronavirus.
The Small Business Leadership Programme is a fully-funded 10 week programme. It will be delivered online and will help you develop your leadership skills. To join the programme:
- your business must be based in England;
- your business needs to employ between 5 and 249 people;
- the business must have been operating for at least one year;
- you should be a decision maker or member of the senior management team within the business with at least one person reporting directly to you; and
- you must be able to commit to attending the full programme.
The Peer Networks Programme focuses on helping business owners improve their problem-solving skills. It seeks to help you develop the skills to deal with challenges brought about by the coronavirus crisis. The programme is available to small and medium sized businesses that have:
- operated for at least one year;
- at least five employees;
- a turnover of at least £100,000; and
- an aspiration to improve.
Business support finder
GOV.UK has an online business support finder. It asks you several multiple choice questions. It uses your answers to produce a list of the types of coronavirus support that may be available to you and your business.
GOV.UK also has information about coronavirus advice and support that is available from business representative organisations and trade associations. Check whether there is any extra help available for your type of business.
The Government has introduced temporary measures to protect business tenants.
- From 26 March 2020 until 31 March 2021, business landlords can no longer end your lease and take the premises back (forfeit the lease) because of rent arrears.
- From 25 April 2020, the minimum amount of unpaid rent that you must owe before a business landlord can use bailiffs under the commercial rent arrears recovery process has also been increased.
For more information, see our Commercial property leases fact sheet.
Your business rent will still be due. If you cannot afford to pay your business rent, contact your landlord to discuss your situation.
- Business rates in England will be scrapped for 12 months from 1 April 2020 for retail, leisure and hospitality businesses. To find out if you qualify, contact your local authority.
- Business rates in Wales will be scrapped for 12 months from 1 April 2020 for retail, leisure and hospitality businesses with a rateable value of £500,000 or below. To find out if you qualify, contact your local authority.
For businesses in England and Wales
The Kickstart scheme
This scheme helps businesses to create new jobs for under 25 year olds who are getting Universal Credit and are at risk of long-term unemployment.
It will pay a young person's wages (based on the National Minimum Wage for 25 hours a week) for six months, plus an amount to cover associated employer National Insurance contributions and employer minimum automatic enrolment contributions. £1,500 per placement is also available to cover setup costs, support and training.
Applications need to be for a minimum of 30 job placements, but employers can partner with other organisations to apply. For more information, see GOV.UK.
For businesses in England
Incentive payments for hiring an apprentice
The Government has said that it will give extra incentive payments for businesses that hire new apprentices between 1 August 2020 and 31 March 2021. It will give businesses:
- £2,000 for apprentices who are under the age of 25; and
- £1,500 for apprentices who are aged 25 and over.
For more information, see the Education Skills Funding Agency website.
Local Restrictions Support Grant (LRSG)
LRSGs are being made available to support businesses that have been affected by local or national restrictions. The grants are being dealt with by local authorities and the amount you will get depends on the rateable value of your business premises.
LRSG (Closed) Addendum provides a grant of up to £3,000 for businesses that had to close because of national restrictions from 5 November to 2 December.
LRSG (Closed) provides a grant of up to £1,500 for every two-week period, from 9 September 2020, that a business has had to close because of local Tier 2 or Tier 3 restrictions.
LRSG (Closed) Addendum: Tier 4 provides a grant of up to £1,500 for every two-week period, from 19 December 2020, that a business has had to close because of local Tier 4 restrictions.
LRSG (Open) can provide grants to businesses that were able to stay open but have been severely impacted because they were in an area under Tier 2 or Tier 3 restrictions. Grants can be backdated to 1 August 2020. Local authorities have discretion on what the level of grants will be.
LRSG (Sector) provides grants for eligible businesses that have been required to stay closed since the first lockdown in March 2020. Grants of up to £1,500 are available for every two weeks that a business has to remain closed from 1 November 2020. Eligible businesses include:
- nightclubs, dance halls and discotheques; and
- adult entertainment venues and hostess bars.
For more information on an LRSG, including how to apply, contact your local authority or visit their website.
Top-up grants for retail, hospitality and leisure businesses
The Government has announced a one-off top up grant of up to £9,000 per property for closed retail, hospitality and leisure businesses. The payment is to help businesses until Spring 2021.
Christmas Support Payment for wet-led pubs
Pubs that mainly serve alcohol, rather than provide food, may be eligible for a one-off payment of £1,000 for December 2020.
The payment is for businesses in Tier 2 and Tier 3 that were forced to reduce their operations because of the regional measures introduced at the start of December 2020.
Applications must be made through your local authority before 31 January 2021. For more information, see GOV.UK.
Additional Restrictions Grant
Local authorities in England have been given funding to provide further support to local businesses that have been affected by coronavirus restrictions. The Government has encouraged local authorities to support businesses that:
- have not had to close but are still impacted by restrictions; and
- are not on the business rates list but have still been affected by restrictions.
Payments can be backdated to 14 October 2020.
Local authorities will set their own eligibility criteria and level of grants. For more information, contact your local authority and see GOV.UK.
Other grants for certain business types are also available through other organisations. GOV.UK contains information about government support for businesses in England. Go to www.gov.uk and search for 'Coronavirus (COVID-19): Business support' or call 0800 998 1098.
For businesses in Wales
Economic Resilience Fund (ERF)
On the 30 November 2020, the Welsh Government announced extra funding for the hospitality, tourism and related supply chain sectors. This includes funding through the:
- ERF Restrictions Business Fund;
- ERF Sector Specific Support; and
- continuation of the ERF Restrictions Discretionary Grant.
Following further restrictions announced in December 2020, the ERF Restrictions Business Fund also covers non-essential retail businesses.
ERF Restrictions Business Fund
The aim of the fund is to support businesses with cash flow to help them survive the economic impact of recent restrictions.
The fund is for businesses in the hospitality, non-essential retail, tourism, leisure and supply chain sectors that were on the local authority non-domestic rating list on 1 September 2020.
- Businesses in receipt of Small Business rate relief (SBRR) with a rateable value of £12,000 or less will be eligible for a £3,000 payment.
- Businesses with a rateable value of between £12,001 and £51,000 will be eligible for a £5,000 payment if they are forced to close.
- Businesses with a rateable value between £51,001 and £150,000 will be eligible for a £5,000 payment if impacted by the restrictions.
Businesses may also be eligible for the relevant support if they have a greater than 40% reduction in turnover during the restriction period. For more information, see Business Wales.
ERF Sector Specific Support
The fund opened for applications on 13 January 2021. It will remain open for two weeks or until the funds are fully committed.
The ERF Sector Specific Support (operating cost) package is targeted at Hospitality, Tourism and Leisure (HTL) businesses or supply chain companies, that are materially affected (by a greater than 60% impact on turnover) as a result of the restrictions.
Eligible businesses will have to be VAT registered, limited companies with turnover above £50,000 and employ staff via PAYE. Use the Business Wales eligibility checker to check whether you are eligible for the grant.
The level of grant paid will depend on several factors, such as how many members of staff a business has. For more information, see Business Wales.
ERF Restrictions Discretionary Grant
Local authorities will continue to deliver the Lockdown Discretionary Grant to businesses that are materially affected by the restrictions (who have a greater than 40% reduced turnover). The grant is targeted at businesses that are not on the non-domestic rates (NDR) system and not eligible for the NDR linked grants.
The grant is set at eligible costs of up to £2,000 per business.
Applications for the grant can be made on local authority websites, or via Business Wales and will be dealt with on a first come first served basis.
For more information, see Business Wales.
Apprentice Recruitment Support
The Welsh Government has launched a fund providing incentives to recruit apprentices. The incentives run from 1 August 2020 to 28 February 2021. The incentives available are:
- up to £3,000 for employing a new apprentice;
- up to £2,600 for re-employing an apprentice made redundant between 23 March 2020 and 28 February 2021; and
- £1,500 for employing a disabled apprentice (in addition to any new and redundant incentive payments).
The amount of the payment will depend on the age of the apprentice and their contracted hours of employment. For more detailed information, see GOV.Wales.
Companies House accounts
The Government has introduced temporary measures to extend the time that most companies have to file their accounts. The extension is given automatically to:
- public companies with a filing deadline that falls between 25 March 2020 and 6 April 2021; and
- private companies with a filing deadline that falls between 26 June 2020 and 6 April 2021.
For further information, see the guidance Temporary changes to Companies House filing requirements. You can check what the deadline is for filing your company’s accounts on the Companies House website.
The Government has introduced measures that temporarily suspend liability for wrongful trading. For many limited companies, this means that a director is not responsible for any worsening of the financial position of the company or its creditors that occurs between the following periods.
- 1 March 2020 to 30 September 2020.
- 26 November 2020 to 30 April 2021.
Temporary protections for limited companies from statutory demands and winding-up notices
The Government has introduced some temporary measures. In certain circumstances, your company may have extra protection from creditors using a statutory demand or other grounds to apply for the business to be wound up. Also, in some circumstances the court may be able to restore a company if a winding-up order has already been made. More information is available in our Limited companies fact sheet.
Limited company meetings
Some companies have a legal requirement to hold meetings. As holding any meeting during the pandemic is likely to be difficult because of social distancing, temporary measures have been introduced for meetings that were due to be held between 26 March 2020 and 30 March 2021. During this period:
- meetings do not have to be held in a specific place;
- those attending do not have to be together in the same place;
- meetings can be held, and votes can be cast, electronically or by other means;
- shareholders do not have the right to attend the meeting; and
- shareholders only have the right to participate by voting or by using a particular method of voting (for example, a show of hands).