COVID-19: Government support tracker - Updated: 07 September 2020

This tracker covers measures announced by the government to support individuals and businesses, as we get through COVID-19.

Measures are being announced and this tracker is updated on a daily basis.

The Coronavirus Bill gives the government emergency powers to deal with the crisis in any way it needs. The bill includes some Statutory Sick Pay (SSP) measures. Further tax legislation enabling the other measures is being announced as the government devises it.  The chancellor gave his Summer Economic Update on 9 July 2020.

At a glance

Announcements cover the following topics:

 

Summer Economic Update measures

  • Jobs and training grants
  • Stamp Duty Land Tax (SDLT) temporary cut
  • VAT rate temporary cut for hospitality sector
  • Eat Out to Help Out voucher scheme
  • Green measures to de-carbonise housing

See Summer Economic Update

 

Employers & Employees

  • Job Retention Bonus - updated 13/8
  • Coronavirus Job Retention Scheme - updated 29/7
  • Guidance for employee/directors - updated 15/6
  • Homeworking guidance: Special tax exemption for reimbursed employee equipment 18/5
  • Statutory Sick Pay (SSP): employees - updated 28/05
  • Off-Payroll Working & SSP
  • Private Sector Off-Payroll changes postponed
  • Employment related securities returns - added 9/6
  • Job Retention Bonus - added 8/7
  • Kickstart Scheme - added 8/7
  • Apprenticeship and training payments - added 8/7
  • No BIK's on employer provided PPE and Covid tests - added 9/7

 

Self-employed

  • Self-Employment Income Support Scheme (SEISS) - updated 2/7
  • Scottish taxpayers: Newly Self-Employed Hardship Fund - added 22/5
  • Self-employed & sick pay, changes to Universal Credit

 

Tax payments & compliance

  • Deferring Income Tax payments
  • Business taxes: Time to Pay
  • Corporation tax: early repayment of tax due to losses - added 18/6
  • Companies House: automatic three-month filing extension until 2021 - added 2/7
  • Coronavirus listed as a reasonable excuse for appeals - added 14/5
  • Appeal time limits extended to three months - added 14/5
  • HMRC late payment interest rate cut
  • CGT: soft landing on penalties under new 30-day reporting regime - added 16/4
  • Access to Heritage Assets: Conditional Exemption Tax Incentive Scheme - added 2/6

 

VAT

  • Deferring VAT
  • Postponement of MTD VAT Digital links
  • Temporary zero-rating of PPE from 1 May 2020 to 31 July 2020 - updated 6/7
  • Deadline for notifying option to tax for VAT extended to 90 days - updated 23/6
  • Construction Industry Domestic Reverse Charge VAT postponed until March 2021 - added 5/6

 

Business rates

  • Small business rates scheme
  • Business Rates: Expanded Retail Discount
  • Support for nursery businesses that pay business rates

Cash funds

  • BEIS COVID support finder tool - added 30/4
  • The Small Business Grant Fund (SBGF) provides grant funding for businesses eligible for Small Business Rates Relief (SBRR) and Rural Rates Relief (RRR).
  • The Retail, Hospitality and Leisure Grant (RHLG) is provided to businesses in England in receipt of the rates Expanded Retail Discount with a rateable value of less than £51,000.
  • A Discretionary Grant Fund of £25,000, £10,000 or any amount under £10,000 for small and micro businesses that are not eligible for other grant schemes - added 3/6
  • Fisheries Response Fund - updated 3/6
  • Zoos Hardship Fund - added 3/6
  • Dairy Hardship Fund - added 3/6
  • Other cash grants
    • Arts Council funding - added 7/4
  • SME business support grants - added 30/7

 

Loan funding

  • SMEs: Coronavirus Business Interruption Loan Scheme - updated 19/5
  • Larger business: COVID-19 Corporate Financing Facility - updated 17/4
  • Microbusiness 'Bounce back' loans - announced 27/4, updated 4/5 for interest rate
  • Future Fund convertible loan scheme - updated 20/5
  • Insurance

Overseas

  • Statutory Residence Test (SRT) - updated 9/4

 

Land & property

  • Landlords & Tenants - updated 4/6
  • Stamp Duty Land Tax (SDLT) - added 4/6

 

Individuals

  • Payment scheme for people living in areas with a high incidence of COVID who are on low incomes, need to self-isolate and cannot work from home - added 27/8
  • Universal credit: Self-employed and low earners
  • Hardship Fund: Social housing and homeless

 

Pensions

  • Temporary changes to pension tax for recently retired returning public sector workers - added 5/5

Savings

  • Reduction in withdrawal charge for lifetime ISA's - added 18/5

 

Overview

Employers and employees

Job Retention Bonus

  • In August 2020 HMRC issued a policy paper expanding the details of the coronavirus 'Job Retention Bonus' (JRB).
  • JRB is a one-off payment to employers of £1,000 for every employee who they previously claimed for under the Coronavirus Employee Job Retention Scheme (CJRS) whose employment is maintained until the end of January 2021.
  • It is important that employers check the rules and eligibility criteria now so as to ensure that they can make valid claims in Feburary 2021.
  • See Job Retention Bonus

Coronavirus Job Retention Scheme (CJRS)

  • Between March and July, employers may claim a grant of up to 80% of past salaries of employees who would have been laid off during this crisis. This is subject to a cap of £2,500 per month.
  • The scheme is modified from July to allow part-time working. From then the employer pays for the hours worked and goverment scheme covers the difference between 'usual hours' and paid hours. New guidance added 'How to calculate 'usual hours' on 1/7
  • From August, the scheme is subject to taper rules which mean that employers gradually start to contribute to furlough pay, ERs NICs and pensions and the cap is reduced. The scheme is due to close on 31 October.
  • The scheme closes to new entrants from 30 June 2020.
  • Written employer-employee furlough agreements must be maintained until 2025 and more guidance on TUPE. Added 27/05
  • PAYE and NIC payments for pay periods where claims have already been made must be up to date or HMRC may refuse claims under the scheme.
  • Employers have 90 days to report and repay overclaims or face penalties.

See Employer guide to the Job Retention Scheme

COVID-19: issues for directors and shareholders

  • Furloughing does not need not cover director's statutory duties.
  • Company law wrongful trading provisions are suspended.
  • Salary for furloughing is based on past salary payments made via the payroll.
  • From 1 July a furloughed director may be able to commence part-time work for their employer.

See COVID-19: Company Directors & Shareholders

COVID-19 Homeworking guidance

  • Special tax exemption for reimbursed employee equipment - added 18/5
  • Announced by the Financial Secretary to the Treasury on 13 May 2020:
  • A temporary tax exemption and National Insurance disregard will come into effect to ensure that the expense of the purchase home office equipment as a result of the Coronavirus outbreak will not attract tax and NICs liabilities where reimbursed by the employer. Certain conditions apply.

See COVID-19: Working from home

Statutory Sick Pay (SSP)

HMRC's new claim portal went live on 26 May 2020.

  • SSP is paid to eligible employees by their employers.
  • SSP is not available to those earning below the Lower Earnings Limit of £118 per week (£120 per week from 6 April), see Sick Pay (below).

The legislation is amended to allow small and medium-sized businesses and employers to reclaim SSP paid for sickness absence due to COVID-19. The eligibility criteria for the scheme is as follows:

  • SSP will be payable from day one instead of day four for affected individuals.
  • SMEs may reclaim up to two weeks’ SSP expenditure per eligible employee who has been off work because of COVID-19.
  • The rate of SSP, for working a five-day week is £95.85 per week from 6 April 2020 (£94.25 to 5 April 2020).

Key essentials for employers

  • An SME is an employer with fewer than 250 employees, The size of an employer will be determined by the number of people they employed as of 28 February 2020.
  • Employers should maintain records of staff absences and payments of SSP.
  • Employees will not need to provide a GP fit note.
    • People who are advised to self-isolate for COVID-19 can obtain an alternative to the fit note to cover this by contacting NHS 111, or online at Get an isolation note - NHS.
    • This can be used by employees where their employers require evidence.
    • Further details will be confirmed shortly.
  • The eligible period for the scheme commenced on 13 March 2020 as the day after the regulations on the extension of Statutory Sick Pay to those staying at home/self-isolating in line with public health guidance came into force. Anyone self-isolating before that date will only be eligible for SSP from day four.
  • For individuals shielding for 12 weeks after receiving a letter from the NHS or their GP, SSP starts from the first qualifying day on or after 16 April 2020.
  • For individuals who are self-isolating because they have been notified by the NHS or public health bodies that they have come into contact with someone with Coronavirus SSP starts from the first qualifying day on or after 28 May 2020.

The online system for making an SSP reclaim will be available from 26 May 2020 through PAYE online. Where employers use an agent who is authorised to do PAYE online for them, the agent can make a claim on their behalf.

See HMRC Claim back Statutory Sick Pay paid to employees due to Coronavirus (COVID-19)

Off-Payroll Working & SSP

  • Following the government's announcement to postpone the introduction of the Off-Payroll Working rules to the private sector, all workers providing their labour via their own Personal Service Companies (PSCs) to private sector end clients, will be entitled, as they are currently in 2019-20 above to claim SSP under the current rules, via their own PSC.
  • The extension of the Off-Payroll Working rules was due to commence on 6 April 2020. The start date will now be deferred to 6 April 2021.

See COVID-19: IR35 & Off-Payroll Working

IR35 & private sector Off-Payroll Working

  • HM Treasury have said they intend to postpone the introduction of the Off-Payroll Working rules to the private sector.
  • The extension of the Off-Payroll Working rules was due to commence on 6 April 2020. The start date is now be deferred to 6 April 2021.

See COVID-19: IR35 & Off-Payroll Working

Employment related securities: Deadlines for registration of new schemes and filing of returns

  • HMRC recognise that some employers and agents may struggle to meet Employment-Related Securities (ERS) tax obligations due to the pandemic and will consider Coronavirus as a reasonable excuse for missing obligations such as registering new schemes and filing annual ERS returns.
  • You should meet these obligations as soon as you can and explain how you were affected by Coronavirus when you make your appeal.

See Employment-Related Securities: What’s New? June 2020

Job Retention Bonus

To incentivise employers to bring staff back to work and ensure they remain employed, the government will:

  • Pay employers a Job Retention Bonus of £1,000 per furloughed employee brought back to work once the CJRS ends, and continuously employed until 31 January 2021.
  • To be eligible workers must be paid at least £520 per month on average between 1 November 2020 and 31 January 2021.

See A Plan for Jobs 2020: Job Retention Bonus

Kickstart Scheme

The government’s ‘Kickstart’ job creation scheme aims to help young unemployed people. It is now open for applications.

Kickstart was announced by the Chancellor in his summer economic update.

The scheme can be used to create new six-month job placements for 16-24 year-olds currently on Universal Credit and at risk of long-term unemployment.

Grant funding is available for:

  • 100% of the relevant National Minimum Wage for 25 hours a week, plus associated employer National Insurance Contributions (NICs) and minimum auto-enrolment pension contributions.
  • There is also a payment of £1,500 per job placement for setup costs, support and training.

Any organisation, irrespective of size, can apply if the scheme conditions are met. There is a minimum of 30 placements required to apply.

  • Employers creating less than 30 placements will have to group together with other organisations to meet the minimum as a group before they can apply.
  • They must then appoint a representative for the group who can claim up to £300 for the administrative costs of acting.

Other such organisations could include:

  • Similar employers.
  • Local authorities.
  • Trade bodies.

This requirement will make the scheme much less attractive to many small and medium-sized employers who will not be looking to create 30 placements or more.

The other key eligibility criteria for the scheme are:

  • The jobs must be new jobs and must not replace existing/planned vacancies or cause existing employees/contractors to lose or reduce their employment.
  • The roles must:
    • Be a minimum of 25 hours per week, for six months.
    • Be paid at least the National Minimum Wage for the age group.
    • Not require people to undertake extensive training before they start.
  • Each application should set out how the employer will help workers develop their skills and experience, including support to:
    • Look for long-term work including support with CV and interview preparations.
    • Develop basic skills, such as attendance, timekeeping and teamwork.
  • Once a job placement is created, it can be taken up by a second person after the first successful applicant has completed their six-month term.

Applications can be made online if the employer is creating more than 30 job placements or if they are the representative for a group of employers.

  • Applications have to be considered by a panel and responses could take up to a month.
  • Initial payments will be made once the employer has confirmed to the DWP the young person has started work, is enrolled on their payroll and is being paid through PAYE.

External links

DWP guidance: Kickstart Scheme

Apprenticeship and training payments

  • English employers who provide trainees with work experience will receive £1,000 per trainee.
  • Employers hiring new apprentices in England between 1st August 2020 to 31st January 2021 will receive:
    • £2,000 for each apprentice between the ages of 16 and 24
    • £1,500 for each apprentice aged 25 and over.

See A Plan for Jobs 2020: Helping the unemployed

Employer provided PPE and virus testing

  • HMRC have advised that if an employer provides employees working in COVID-19 high-risk environments with Personal Protective Equipment (PPE) and coronavirus tests it will not be a taxable Benefit In Kind.
    • Where employers provide testing kits to employees outside of the national scheme there will also be no BIK.
  • Where employees work in an environment where the risk of virus transmission is very high and the employer risk assessment shows PPE is required, the employer must provide it and this will be non-taxable.
  • Where an employee requires PPE to carry out their job and the employer cannot provide it, the employer must reimburse the cost to the employee. This is non-taxable.

See COVID-19: Employer-provided PPE and testing

Self-employed

Self-Employment Income Support Scheme (SEISS)

New: self employed parents can claim the support grant - added 26/6

  • Modified rules to ensure that parents whose profits dipped in 2018/19 will now be able to use their profits either their 2017-18 or both their 2016-17 and 2017-18 self-assessment returns. This will modify the current conditions A to C.

First and second grants paid to 13 July and from 14 July:

  • A taxable grant of 80% of average monthly taxable profits over the three years to 5 April 2019 for the first three months to 31 May 2020, dropping to 70% for the next three months.
  • Capped at £7,500 for the first three months, dropping to £6,570.
  • Initially available for three months, extended on 29 May for a further, final three months. Payable as a lump sum from 25 May 2020 for the first period and in August 2020 for the second period, and administered by HMRC.
  • Claims for the first grant must be made on or before 13 July 2020. Claims for the second grant commence in August and must be made on or before 19 October 2020.
  • Two separate claim periods: no requirement for a claim for the first period to be eligible to claim for the second and final period but must be adversely affected by coronavirus on or after 14 July 2020 for the second grant.
  • Taxpayers have 90 days to report and repay overclaims or face penalties.

See Self-Employment Income Support Scheme

Scotland: Newly Self-Employed Hardship Fund

A one-off grant of £2,000 if you became self-employed on or after 6 April 2019 & unable to claim under the SEISS.

To be eligible you must:

  • Have become self-employed on or after 6 April 2019
  • Have lost revenue due to the Coronavirus pandemic
  • Have not been able to access support through other COVID-19 business support schemes.

Self-employed and low earners

Sick Pay

  • Self-employed individuals and people earning below the Lower Earnings Limit of £118 per week (£120 from 6 April) are not eligible for SSP.
  • These individuals can make a claim for Universal Credit or Contributory Employment and Support Allowance
  • Special measures apply for the duration of the virus outbreak.
    • The requirements of the Universal Credit Minimum Income Floor will be temporarily relaxed for those who have COVID-19 or are self-isolating according to government advice. This is to ensure self-employed claimants will receive support.
    • People will be able to claim Universal Credit and access advance payments upfront without the current requirement to attend a jobcentre if they are advised to self-isolate.
    • A contributory Employment and Support Allowance will be payable, at a rate of £73.10 a week if you are over 25. This may be claimed by eligible people affected by COVID-19 or self-isolating in line with advice from Day one of sickness, rather than Day eight.
  • More details are expected from the government on eligibility criteria. We assume that you may self-certify perhaps after receiving advice by ringing NHS 111.

VAT

VAT payments may be deferred for three months.

A payment deferral applies from 20 March 2020 to 30 June 2020 for VAT registered business.

This is a deferral of tax and not an exemption: effectively, this is a fast way to provide business with emergency funding.

  • This is an automatic offer with no applications required.
  • VAT refunds and reclaims will be paid by the government as normal.
  • Direct debits need to be cancelled if you wish to take advantage of the deferral. Alternatively a refund can be claimed if direct debits were not cancelled in time.

See COVID-19 VAT deferral

VAT: Making Tax Digital (MTD) Digital links

  • HMRC has deferred the start date for the introduction of digital links into MTD for VAT functional compatible software.
  • Digital links will now not be required until your first VAT return period starting on or after 1 April 2021.

 VAT: Temporary zero-rating of PPE from 1 May 2020 to 31 October 2020

  • Sales of personal protective equipment (PPE) to protect against COVID-19 will be zero-rated for VAT from 1 May 2020 until 31 October 2020 (extended from 31 July 2020).

See COVID-19: Temporary zero-rating for PPE

 

VAT: Option to tax deadline extended

  • HMRC has announced that they are extending the deadline for notifying them about an option to tax land and buildings to 90 days due to the Coronavirus pandemic. The extension applies to decisions made between 15 February and 31 October 2020 (previously 30 June 2020).

See COVID-19: Option to tax deadline extended

 

VAT: CIS Domestic Reverse Charge

  • HMRC have announced a delay to the introduction of the domestic reverse charge for construction services until 1 March 2021 due to the impact of the Coronavirus on the construction sector.
  • Additionally, they have changed the exclusion requirements of end-users and intermediaries.

See COVID-19: CIS Reverse Charge VAT

 

Deferring Income Tax payments

Income Tax

Income Tax payments on account due by 31 July 2020 for the 2019/20 tax year under the Self Assessment system may be deferred.

  • Payment will be deferred until the 31 January 2021.
  • This is an automatic offer with no applications required.
  • No penalties or interest for late payment will be charged in the deferral period.
  • This applies to all taxpayers due to make Self Assessment payments on 31 July 2020 and not just the self-employed.

See COVID 19: Deferring Income Tax payments

Business taxes: Time to Pay

  • All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
  • These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.
  • It is essential to contact HMRC and make a Time To Pay agreement before the tax debt becomes due.

If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s dedicated helpline on 0800 024 1222.  Phone number updated 26/03/2020.

See COVID-19: Time to Pay

Corporation tax: claims for early repayment

  • In June 2020 HMRC updated its corporation tax guidance covering situations where a company seeks repayment of tax before a return has been filed, as may be the case where a business knows that it has suffered large losses due to the Coronavirus.

 

Companies House

A three-month filing extension was announced in respect of accounts from 25 March 2020. This now applies automatically until April 2021.

  • A late filing extension also applies to certain other statutory filings, the amount of time given is dictated by the type of filing.

Appeals: Reasonable excuse

  • HMRC have issued updated guidance on when taxpayers have a reasonable excuse for the late filing of returns or late payment of tax to specifically include being affected by Coronavirus.

Appeals: Deadline extended

  • HMRC has announced that they will extend the deadlines for appealing tax penalties and decisions from 30 days to up to 3 months where the taxpayer or their business has been affected by COVID-19.

HMRC late payment interest rate cut

HMRC interest rates for late payments will be revised after the Bank of England interest rate reduction to 0.1%.

These changes will come into effect on:

  • 30 March 2020 for quarterly instalment payments.
  • 7 April 2020 for non-quarterly instalments payments.

Repayment interest rates remain unchanged. Added 20/3/2020

The rate for underpayments of quarterly instalments is reduced to 1.25% from 23 March 2020. Added 24/03/2020.

See COVID-19: HMRC reduce late payment interest rate

 

CGT: Soft landing on penalties under new 30-day reporting regime

  • HMRC have announced that they will not charge any penalties where UK residents fail to report Capital Gains on UK residential property within the new 30-day deadline until after July 2020.

See Change to new CGT reporting

 

Access to Heritage Assets: Conditional Exemption Tax Incentive Scheme

  • HMRC acknowledges that access by the public to certain Heritage Assets may necessarily restricted during the Coronavirus crisis.
  • See Heritage Assets: CGT and IHT relief

 

Business Rates

Small business rates scheme

  • The existing small business rate relief continues to apply, this provides full relief for any type of businesses using a single property with a rateable value of £12,000 or less.

Business Rates: Expanded Retail Discount

  • 100% discount on business rates.
  • To apply to occupied retail, leisure and hospitality properties in the year 2020/21.
  • There is no rateable value limit on the relief.

See COVID-19 Business Rates

Support for nursery businesses that pay business rates

  • There will be a business rates holiday for nurseries in England for the 2020-21 tax year.
  • You are eligible for the business rates holiday if:
    • Your business is based in England.
    • Your property is:
      • occupied by providers on Ofsted’s Early Years Register and
      • wholly or mainly used for the provision of the Early Years Foundation Stage
    • There is no action required, it will apply to your next council tax bill in April 2020.
    • You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.

Cash grants

Cash grants are available to support businesses during the COVID-19 crisis.

  • The Small Business Grant Fund (SBGF) provides grant funding for businesses eligible for Small Business Rates Relief (SBRR) and Rural Rates Relief (RRR).
  • The Retail, Hospitality and Leisure Grant (RHLG) is provided to businesses in England in receipt of the rates Expanded Retail Discount with a rateable value of less than £51,000.
  • A Discretionary Grant Fund of £25,000, £10,000 or any amount under £10,000 for small and micro businesses that are not eligible for other grant schemes.
  • Fisheries Response Fund
  • Zoos Hardship Fund
  • Dairy Hardship Fund

See COVID-19 Grant Funding for Business.

 

SME business support grants

A £20m fund for grants of £1,000 to £5,000 to help SME's rebuild.

  • To be managed by Local Enterprise Partnerships.
  • Grants may be used for technology and equipment and specialist financial and legal advice.
  • No financial contribution required from the business.

The government has announced a new £20m grant scheme to help Small and Medium-sized Enterprises (SMEs) as part of their package of measures to support businesses during the COVID-19 pandemic.

The funding will provide grants of between £1,000 and £5,000 to help eligible businesses in England access new equipment and technology as well as professional, legal, financial and any other specialist advice necessary to help them adapt, recover and rebuild. Grants can be used for advice in areas such as HR, accountancy and IT.

No financial contribution will be required from businesses claiming under the scheme. The funding will come via Local Enterprise Partnerships (LEPs) of which there are currently 38, with each LEP area being allocated a pot of at least £250,000 to establish a grant programme.

The funding is being provided to address immediate needs and all grants must be awarded by 28 February 2021 and all activity fully completed by 31 March 2021.

More details are expected soon about how the grants will work and when businesses can start claiming under the scheme.

Arts Council funding

Cash grants are available: there is a tight deadline for applications.

  • £90 million for National Portfolio Organisations (NPOs).
  • £50 million for organisations outside of the National Portfolio.
  • £20 million for creative practitioners and cultural workers.

See COVID-19: Arts Council Funding

 

Loan funding

 

Microbusinesses: 'Bounce back' Loan scheme

  • On 27 April the Chancellor announced a new loan scheme aimed at micro-businesses.
  • This will provide loans of £2,000 up to £50,000 for up to six years.
  • The government will pay the interest on the loans for the first 12 months. No repayments will be due for the first 12 months. The interest rate is set at 2.5%.
  • The scheme will provide lenders with a 100% government guarantee.
  • Businesses eligible for a loan are those which:
    • Are based in the UK.
    • Have been negatively affected by the Coronavirus.
    • Were not an ‘undertaking in difficulty’ on 31 December 2019.
    • Are not already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS).
  • The scheme is open for applications from 4 May through a simple online form.
  • Anyone with a loan through CBILS of £50,000 or less can apply to have it switched to this scheme.

See Apply for a Coronavirus Bounce Back Loan

SMEs: Coronavirus Business Interruption Loan Scheme (CBILS)

  • A new Coronavirus Business Interruption Loan Scheme will be delivered by the British Business Bank.
  • This is aimed at small and medium-sized businesses to access bank lending and overdrafts. It initially only applied to businesses unable to obtain regular commercial financing but on 3 April was extended to all businesses affected by COVID-19.
  • The scheme is covered by the government and will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs.
  • The government will not charge businesses or banks for this guarantee and the Scheme will support loans of up to £5 million in value.
  • On 3 April the government announced that lenders must not ask for personal guarantees for loans below £250,000.
    • For loans above this level personal guarantees may be required, at the lender’s discretion, but they must exclude the Principal Private Residence and cap recoveries to 20% of the outstanding balance of the loan facility after the proceeds of business assets have been applied to it.
  • The scheme will be open for six months with loan terms of up to three years.
  • Businesses are liable for 100% of the loans they receive, the government are providing a guarantee for 80%.
  • Businesses can access the first twelve months of that finance interest-free, as the government will cover the first twelve months of interest payments.
  • To be eligible businesses must:
    • Be UK based with an annual turnover of up to £45 million.
    • Generate more than 50% of their turnover from trading activity.
    • Have a borrowing proposal which would, were it not for COVID-19, be considered viable by the lender to enable your business to trade out of any short-to-medium term difficulties.
    • The scheme became available from 23 March 2020. Details of the lenders providing access to the scheme and how to apply can be found here. Terms are being set by individual lenders.
  • Businesses are advised to approach their existing lender and to apply through the lender's own website in the first instance. They can then try other lenders if their own lender cannot help.

Large business: Extension of Business Interruption Loan scheme to larger businesses

On 16 April the government announced that the £500m turnover cap does not apply, this scheme now applies to businesses with a turnover of more than £45m. Additionally, firms with a turnover of more than £250 million can borrow up to £50 million from lenders.

On 3 April the government announced that the scheme was being extended to larger businesses with a turnover of between £45m and £500m. This became available from 20 April 2020.

  • Loans of up to £50m (previously £25m) can be made under the extended scheme. It was announced on 19 May that this would be extended to £200m from 26 May but with conditions added around executive pay and dividends until the loans are repaid.
  • The same criteria and rules apply as for the SME CBILS. Banks, building societies, insurers and reinsurers (but not insurance brokers) and public-sector organisations, including state-funded primary and secondary schools are all excluded from the scheme.

Larger business: COVID-19 Corporate Financing Facility

  • The Bank of England has announced a new lending facility for larger businesses to provide a quick and cost-effective way to raise working capital via the purchase of short-term debt.
  • The minimum amount is £1 million. The facility will be available for at least twelve months.
  • This will support companies who can show they were in 'sound financial health' prior to the COVID-19 shock,  to enable them to continue financing their short-term liabilities.
    • 'Sound financial health' means a short-term credit rating of A3/P3/F3/R3 or above, or a long-term rating above BBB-/Baa3/BBB- by at least one of the major credit ratings agencies.
    • If firms do not have an existing credit rating from one of the major credit ratings agencies, they or their bank should get in touch with one of the major credit rating agencies to seek one. This should be in a form that can be shared with the Bank of England and HM Treasury, and note that the reason for seeking the rating is so that the firm may use the CCFF.
  • The Bank will also support corporate finance markets overall and ease the supply of credit to all firms.
  • Businesses should start with their own banks. If they are not able to issue commercial paper there is a list of other banks who do with contact details on the UK Finance website.

The scheme became available from the week commencing 23 March 2020.

Future Fund convertible loan scheme

  • The ‘Future Fund’ scheme is operated by the British Business Bank and it opened on 20 May 2020.
  • It offers unsecured bridge government funding of up to 50% of the total bridge funding received by a company, where the remaining amount is provided by private third party investors.
  • To be open to companies with a UK economic presence who have raised at least £250,000 in the last five years.
  • The bridge funding will automatically be converted into equity on the company's next qualifying funding round.
  • The minimum lending from the Government under the scheme will be £125,000, up to a maximum of £5,000,000.
  • The minimum interest rate for the government will be 8% and the loan will mature after a maximum of 36 months.

See COVID-19: Future Fund convertible loan scheme

Insurance

  • Standard business interruption policies are unlikely to cover a pandemic.
  • New policies will definitely exclude it.

Check your policy wording and contact your insurer.

Hardship Fund: Social housing and homeless

  • The government announced a new £500 million Hardship Fund so Local Authorities can support economically vulnerable people and households.
  • The government expects most of this funding to be used to provide more council tax relief, either through existing Local Council Tax Support schemes or through similar measures.
  • The Ministry of Housing, Communities and Local Government will set out more detail on this funding, including allocations, shortly.

Payment scheme for people living in high risk areas on low incomes, need to self-isolate and cannot work from home

The scheme opens on 1 September 2020 and will initially only apply in specific areas subject to local lockdown starting, on a trial basis, with Blackburn with Darwen, Pendle, and Oldham.

It will apply to people who:

  • Are employed or self-employed and receiving either universal credit or working tax credit.
  • Have tested positive for COVID-19, as well as their contacts.

 

Eligible individuals will receive £130 for their 10-day period of self-isolation.

  • Other members of their household, who have to self-isolate for 14 days are to receive £182.
  • Non-household contacts advised to self-isolate through NHS Test and Trace will receive £14 per day, up to £182, with the actual amount being dependent on the length of their isolation period.

 

Those eligible to receive a payment will need to provide:

  • Notification from NHS Test and Trace.
  • A bank statement.
  • Proof of employment/self-employment.

 

Other immediate changes applicable for direct and indirect taxes

Statutory Residence Test (SRT)

  • For the purposes of day counting for SRT. If you:
    • are quarantined or advised by a health professional to self-isolate in the UK as a result of the virus
    • find yourself in a ‘lockdown’ situation as a result of the virus
    • are unable to leave the UK due to the closure of international borders
    • are asked by your employer to return to the UK temporarily as a result of the virus

          HMRC consider that the circumstances are 'exceptional'.

  • On 9 April the Chancellor confirmed that time spent by individuals in the UK between 1 March 2020 and 1 June 2020 working on COVID-19 related activities will not count towards the residence test and this will be included in Finance Bill 2020 accordingly.

See COVID-19: Statutory Residence Test

Landlords & Tenants

Private or social accommodation.

  • Landlords will not be able to start proceedings to evict tenants for at least a five month period.
  • Landlords whose tenants are experiencing financial difficulties due to Coronavirus will receive a six-month mortgage payment holiday (extended from 3 months on 5 June 2020).
  • At the end of this period, landlords and tenants are expected to work together to establish an affordable repayment plan, taking into account tenants’ individual circumstances.

Commercial tenants

  • Coronavirus Bill provides that no business will be forced out of their premises if they miss a payment in the next 3 months.
  • All commercial tenants in England, Wales and Northern Ireland are eligible.

See COVID-19: Landlords & tenants

Stamp Duty Land Tax (SDLT)

HMRC has updated its guidance on exceptional circumstances that allow refunds following a sale outside of the normal three-year limit to specifically include the impact of COVID-19 preventing the sale.

You may still be able to apply for a refund, if you purchased your new home on or after 1 January 2017 and were unable to sell your previous home within 3 years. To be able to get the refund, the delay in selling must be because of reasons outside of your control. These may be, but are not limited to:

  • the impact of Coronavirus (COVID-19) preventing the sale
  • an action taken by a public authority preventing the sale

 

Pensions

Temporary changes to pension tax for recently retired returning public sector workers

  • The government is temporarily relaxing the pension unauthorised payment charge rules for recently retired public sector workers between the ages of 50 and 55 who are returning to work because of COVID-19.
  • Applies to pension payments made between 1 March and 1 June 2020.

 

Savings

Reduction in lifetime ISA withdrawal charge

  • From 6 March 2020 to 5 April 2021, the charge for making a withdrawal from a lifetime ISA (LISA) is reduced from 25% to 20%.
  • LISA managers who have already deducted 25% can correct this by making a repayment back to the LISA if it is still open or directly to the investor if it is not.

 

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