Government Financial Support for All Businesses
The government has released a raft of measures to support businesses and sole traders through the Covid-19 pandemic. Use the support finder to see what schemes are still available for you and your business.
Chancellor announces top-up grants for some businesses (Update 05/01/2021)
The Chancellor has announced a one-off top up grant for businesses in the retail, hospitality and leisure sectors worth up to £9,000 per-property basis.
The one-off top-ups will be granted to closed businesses as follows:
- £4,000 for businesses with a rateable value of £15,000 or under
- £6,000 for businesses with a rateable value between £15,000 and £51,000
- £9,000 for businesses with a rateable value of over £51,000
Further information can be found here.
An additional £594m discretionary fund will also be made available through local authorities and devolved administrations to support other businesses affected by the restrictions.
This funding comes in addition to the £1.1bn Local Restriction Support Grants for closed businesses worth up to £3,000 a month.
Further guidance on the Local Restrictions Support Grant (for closed businesses) is available here.
These grants will be administered through your local authority so you should visit their coronavirus support pages for further details on how to apply.
As further guidance and clarification is released on these grants will communicate this with you.
Annual Investment allowance reverts to £1m for another year (19-11-2020)
The temporary tax break for businesses investing in equipment - the annual investment allowance (AIA) has been extended.
In a news statement on 12 November, the government announced that the AIA limit, which was due to revert to £200,000 from 1 January 2021, will remain at £1 million for another year.
The policy change means that businesses can continue (until 1 January 2022) to claim a tax deduction for the accounting period in which they purchase qualifying plant and machinery, up to the £1 million cap. No other changes to the AIA rules are indicated in the government’s statement.
It is an important planning note that where a business year end differs to the calendar year, allowances are pro-rated. For example if you have a March year end the allowance available in the 9 months to December 2021 would be £750,000 and the three months to March 2022 would be £50,000. It is not simply a case of £800,000 being available for the full accounting year, the date of purchase is important and the tax saving could be vastly different depending on the day the purchase occurs.
If you are considering significant investment in plant and machinery and would like advice on how the above affects you contact us for more information.
Business Grants - (05/11/2020)
Businesses required to close in England due to local or national restrictions will be eligible for the following:
- For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks;
- For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks;
Business Grants - Hospitality, accommodation and leisure
Cash grants of up to £2,100 per month have been announced primarily for businesses in the hospitality, accommodation and leisure sectors who may be adversely impacted by restrictions imposed in the high-risk alert areas. The grants will be available retrospectively for areas already subject to high levels of restrictions.
If you are looking to create job placements for young people then check to see if you could apply for the kick start scheme. The scheme has been designed to create new 6-month job placements for young people who are currently on universal credit and at risk of long-term unemployment.
Apply for a Kickstart Scheme grant: 29 or less job placements:
Apply for a Kickstart Scheme grant: 30 or more job placements:
Find a Kickstart gateway to apply for a Kickstart Scheme grant on your behalf:
Information for organisations who want to be a Kickstart gateway and help employers apply for the Kickstart Scheme: https://www.gov.uk/guidance/help-employers-apply-for-a-kickstart-scheme-grant-kickstart-gateway
Deferral of VAT (New Payment Scheme)
The VAT deferral scheme ended on 30 June 2020, however the government revealed their Winter Economy Plan which includes the New Payment Scheme.
This means that you now have the option to pay back the deferred amount in smaller instalments. Rather than paying the lump sum which was due by March 2021, you will be able to make 11 smaller instalments to help spread the cost during 2021/22.
Deferral of Income Tax (Self Employed)
If you are self-employed, Income Tax Self-Assessment payments due on the 31 July 2020 were previously deferred until the 31 January 2021. Government have now announcement a ‘time to pay’ options meaning that payments deferred to January 2021 can now benefit from an additional 12 months extension meaning this will now not need to be paid until January 2022.
HMRC’s ‘Time to Pay’
All businesses and self-employed people who find themselves in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HRMC's 'Time to Pay' service. Arrangements will be agreed on a case-by-case basis. HMRC will discuss your specific circumstances to explore:
- agreeing an instalment arrangement
- suspending debt collection proceedings
- cancelling penalties and interest where you have administrative difficulties contacting or paying HMRC immediately
Call the Helpline
HMRC have a helpline for businesses who have concerns and worries about complying with their tax obligations due to the Coronavirus pandemic - 0300 200 3822
HMRC have stated that this helpline can be used to:
- Agree instalment arrangements
- Suspend debt collection proceedings
- Avoid penalties and interest
Businesses that have cover for both pandemics and Government-ordered closure should be covered.
Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and contact their providers.
Policies you may be able to claim on include:
- Business Interruption Insurance
- Public Liability Insurance
- Employers’ Liability Insurance
Potential lifeline for small businesses
September saw the High Court rule in favour of a small business that ‘the disease clause in some business interruption policies should have meant they were covered’.
If you have tried and failed to claim on your business interruption insurance, we would recommend that you try again following this ruling to see if anything has changed in relation to your insurers handling of claims.
Help for Retail, Hospitality & Leisure Businesses
Business Rate Relief
If you pay business rates you may be eligible for a 12 month business rates holiday. The government announced at the start of the pandemic that it will not charge business rates for companies in the retail, leisure and hospitality sectors in the year 2020/21. There will be no rateable value limit on the relief.
Extension to VAT relief
Hospitality and Tourism businesses have been given more breathing space through the winter months with the 15% VAT cut extended until 31 March 2021.
To help you keep your business operating, we’ve made it easy to access the correct and most up-to-date information. Below, you’ll find information on government support for businesses and individuals and practical advice to help you to manage your business through this unusual period.