Weeks of lockdown can be a real challenge to any business and its employees, no matter how established it is. In a bid to protect jobs and businesses from collapse, the government has extended a range of support measures. Therefore, in this article we take a look at some of the schemes available to businesses who cannot fully operate due to this lockdown.
The Bounce Back Loan
The scheme helps small and medium-sized businesses to borrow between £2,000 and £50,000, and up to 25% of their turnover. The government also guarantees 100% of the loan with no fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year.
Further, for businesses that have already accessed the Bounce Back Loan but have not borrowed their maximum amount, can now apply to top-up their existing loan, but can only do so once.
At present, the deadline for applying for a new BBL is the end of March 2021.
Take a look at some more information, and how to apply.
Self-Employment Income Support Scheme (SEISS)
This scheme provides equivalent support to the self-employed as is provided to employees through the government contribution in the CJRS Furlough Scheme. At the moment, the SEISS has been increased to meet 80% of trading profits covering November 2020 to January 2021 and from February 2021 to April 2021 for all parts of the UK.
The current grant is calculated based on 80% of 3 months’ average trading profits, paid out in a single instalment and capped at £7,500. The details of the grant for the February to April period is yet to be announced.
You can get all up to date information, including eligibility criteria and the window to claim as well as being able to make your application, on the gov.uk website.
The Coronavirus Business Interruption Loan Scheme (CBILS)
This scheme was created in order to help small and medium-sized businesses to access loans and other kinds of finance, up to £5 million.
The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months.
You can also find out all current information and apply at gov.uk.
The Coronavirus Large Business Interruption Loan Scheme (CLBILS)
Similarly to the regular CBILS scheme, this scheme helps medium and large-sized businesses to access loans and other kinds of finance up to £200 million and the government guarantees 80% of the finance to the lender.
Companies must have an annual turnover of more than £45m to be eligible and cannot be used in conjunction with the Covid-19 Corporate Financing Facility (CCFF).
For more information on the terms of making an application, take a look at the gov.uk website.
National Lockdown Business Support Grant
You may be eligible for a monthly grant up to £3,000 if your business was forced to close.
There are also additional grants for nightclubs, dance halls, and other entertainment venues up to £1,500 for each 14-day period the business is closed.
To find out if you are eligible and to apply, look here.
If we move back into a tier system in the near future, there is also a local lockdown business support grant.
Business Rates Relief
If your business is in the retail, hospitality and leisure sectors in England, you won’t have to pay business rates for the 2020-2021 tax year. This applies to:
- Restaurants, cafés, bars, pubs
- Cinemas, live music venues
- Assembly or leisure properties, like sports clubs, gyms, spas
- Hospitality properties, like hotels, guest houses, self-catering accommodation
Coronavirus Job Retention Scheme (CJRS)
This well known, and well-utilised scheme provides 80% of employees' monthly salary covered for hours not worked, up to a maximum of £2,500.
Employers will have the flexibility to use the scheme for employees for any amount of time or shift pattern, furloughing employees on either a full-time or part-time basis. And employers only have to cover National Insurance and employer pension contributions.
The CJRS was originally due to close on 31st October 2020, but has now been extended until 30th April 2021.
You can read more information about the furlough scheme extension at gov.uk.
Refund Of Statutory Sick Pay
SMEs with fewer than 250 employees as of 28 February 2020 will get a full refund from the government on 14 days of statutory sick pay per employee off sick with Covid-19. Any sickness you claim for needs to have started on or after 13 March 2020.
The online repayment system for coronavirus related SSP is now available on the government website.
£750 Million For Innovative Small Businesses
Rishi Sunak, Chancellor of the Exchequer, said: “Britain is a global leader when it comes to innovation. Our start-ups and businesses driving research and development are one of our great economic strengths, and will help power our growth out of the coronavirus crisis.”
Therefore, SMEs focused on research and development will have access to £750 million of grants and loans. The funding will be available through national innovation agency Innovate UK, and its grants and loan scheme.
The first payments started in mid-May, and there’s more information on the government website.
The Next Steps For Your Business
It is worth noting that the information provided is for businesses in England. Different support is available for businesses in Scotland, Wales and Northern Ireland.
If you’d like some more helpful information regarding your business during these unprecedented times, we have written some content about moving your business online during the pandemic and some top tips on effective home working.
The best advice we can give is to keep up to date with the latest financial support that the government is offering to support your businesses through this Covid-19 lockdown. The gov.uk resources are the best place to look.
If you are interested in creating a business plan that addresses your next steps as a business, contact us.
Call one of our friendly and professional business plan writing experts on 01604 420 420 or contact us using the form on the right.