Posted on: 03 April 2020 (updated on 21 April)

Supporting your business during the coronavirus outbreak

The UK government has announced a series of measures to reduce the spread of the virus, such as the lockdown and social distancing, and whilst this was the right thing to do to save lives, it has also led to some large scale financial losses for people in the UK.

The government recognises the value of small businesses to the UK economy, and as such has pledged to support these businesses during the COVID-19 outbreak. Carry on reading to find out about some of the government incentives that can support businesses with their cash-flow during the 2020 coronavirus pandemic.

What is the government doing to support business during the coronavirus outbreak?

Coronavirus Job Retention Scheme

The Coronavirus Job Retention Scheme is a scheme which started on 1st March. The scheme allows businesses to claim 80% of the wage of furloughed employees who are on a leave of absence because of coronavirus.

Any UK business can apply for this support, up to £2,500 per employee, per month. On 17th April, the BBC reported that the scheme will run until the end of June to help businesses during the ongoing pandemic.

Self-employment Income Support Scheme

Because of some of the precautions taken by the government, self-employed workers have lost money as a result of cancelled appointments and contracts due to the lockdown and social distancing measures. However, some self-employed workers may be eligible for a scheme that protects income during the pandemic.

The Self-employment Income Support Scheme will also provide up to 80% of trading profits, with a maximum of £2,500 per month, for the next three months for self-employed workers out of work.

Zero hour contract workers can also apply for support, but they need to have been employed for at least 12 months so that they can inform the government of their average earnings for the year. If they haven’t been employed for 12 months, they will need to have been on the payroll since 28th February to receive support. Average monthly earnings must be applied to these workers.

Deferring VAT and Income Tax

To help keep cash in the business, the government has announced that businesses will be able to defer their VAT, PAYE and Income Tax payments until later in the year.

Whilst this is only a temporary deferral, this should allow businesses to keep money in the bank to keep them going during a period when money might not be coming into the business.

Deferred payments must be made before 5th April 2021, and if you normally make your payments with Direct Debit (DD), remember to cancel this payment, as the government will continue to take payments. You should also make sure that you contact HMRC to inform them that you are planning on stopping your DD payments.

Protection for retail, hospitality and leisure businesses

Businesses in the retail, hospitality and leisure industries have been some of the hardest hit by the coronavirus. Whilst many of these businesses are profitable, they will be taking huge financial hits without the support of some of the previous schemes that we have outlined above. Because of this, to protect these businesses, the government has offered a support package for eligible businesses.

Businesses in occupied properties that are used as a shop, café, drinking establishment, cinema, live music venue, meeting or leisure venue, hotel, guest, boarding premises or self-catering accommodation will be able to take a business rates holiday for the 2020/2021 tax year.

There are cash grants available for businesses in these industries of up to £25,000 per property. Businesses with a rateable value of up to £15,000 could be eligible for a £10,000 grant, and businesses with a rateable value of between £15,000 and £51,000 could be eligible for a grant of £25,000.

Coronavirus Business Interruption Loan

The government announced a business interruption loan, designed to support businesses when cash-flow might be impacted.

Businesses can access loans, overdrafts, invoice finance and asset finance of up to £5 million pounds for a duration of 6 years. There is also a Business Interruption Payment so that small businesses have no upfront costs on these loans and lower initial repayment rates.

The loans being offered in this scheme are interest-free for the first 12 months.

Take a look at some the banks offering these Business Interruption Loans here.

Time to Pay

If your business has outstanding tax liabilities, you could receive support in making repayments under the Time to Pay scheme.

The government will review a case individually so that businesses with unique tax circumstances can benefit from the service.

Commercial tenant eviction protection

If a business has no form of income, they may be unable to pay their rent, leaving them vulnerable to eviction.

The government introduced measures so that businesses would not be evicted if they were unable to pay their rent because of coronavirus. This support will last up to 30th June 2020 but does not allow businesses to miss rent payments, only protects them from eviction.

Finding support from elsewhere

Whilst the government is working to support businesses, there are other businesses providing advice and guidance to businesses.

Federation of Small Businesses

The Federation of Small Businesses (FSB) provide services to their members, such as general business guidance, financial advice and campaigning for changes to policy.

They have also provided coronavirus advice and guidance for small businesses and the self-employed on their website.

National Health Service (NHS)

The NHS isn’t just there to treat us in our hour of need. They also give advice and guidance on how to stay healthy.

Take a look at the NHS website for information about coronavirus, such as how you can look after your mental wellbeing whilst staying at home and some of the exercises that you can do.

What about physical business’ premises?

Rental or mortgage break for commercial property

Whilst you may be protected from eviction from your commercial property, you still have an obligation to pay your landlord for the rent that you owe them.

If you are unable to pay your rent to your landlord because of the coronavirus, be open with them and work with them to find a solution.

You could suggest a rental holiday, whereby when the coronavirus pandemic comes to an end, you can total up how much you owe your landlord and create a monthly payment plan for the following year.

If you are paying a mortgage on a commercial property, you should also speak to your bank to see if you can get a mortgage payment holiday to help reduce your outgoings whilst the pandemic continues to cause disruption to your business

Utility bill freeze

If your business premises are going to be empty for an extended period of time, speak to your utility supplier to see if you can get a break on your utility bills.

You may still need certain utilities, such as electricity for security equipment, but if you won’t be using gas and water, speak to your provider to see if you can arrange a utility bill payment holiday.

Business support from Premierline

To help you and your business during these unprecedented circumstances, Premierline has taken some steps to ensure that we can continue to offer our award-winning service.

All Premierline employees are now working from home, but our teams are equipped to be able to answer your questions and help to support your business whilst the coronavirus pandemic continues. We have published answers to many frequently asked questions and contact details on our customer information page.

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