Coronavirus - Remember, remember the 5th November

With this Thursday 5th likely seeing the start of a 4 week national lockdown in England, businesses may feel they have more fires to put out than on bonfire night!

To help businesses put some of their fires out and survive, we are in the familiar territory of continuing government support for jobs and premises-based businesses. 

There will be new funding for:

CJRS – Coronavirus Job Retention Scheme – August version applying to November [EDIT: EXTENDED TO END OF MARCH 2021]

Employees agree to receive 80% of their reference pay, which the government pays up to £2,500 per month. Their employer pays employer national insurance and pension contributions, and may top up the basic pay beyond 80%. Training, voluntary work or work for another employer may be carried out during a furlough period.

If there is some work to do, employees may be on flexible furlough, paid in full for the hours worked, with the government payment only applying for non-worked hours.

Importantly, an RTI submission must have been made by close of 30th October, again emphasising government preference to use up to date information and to help prevent fraud.

To date, the reference pay has usually been as it was on or before March 2020, with no pay rises expected. As new employees and employers may use this November scheme, the reference pay will need to change perhaps to the amount paid on or before October. We'll be checking the details when they come out.

For shareholder-directors on a tax year 2019/20 reference salary of £719 now finding there is no work for them beyond statutory duties, they should be able to claim at least £575.20 for November while paying themselves the 2020/21 recommended £732 monthly salary. Again, we need to see the details in due course.

Business Grants – Premises based businesses

Further business grants will be paid for businesses required to close with properties with a rateable value of: 

• £15k or under, receiving £1,334 per month.
• Between £15k-£51k, receiving £2,000 per month.
• £51k or over, receiving £3,000 per month. 

The reference to a monthly figure clearly suggests this lockdown may last longer than the hoped-for one month!

Often used to pay rent and utilities, these are essential for businesses who can’t trade at all.

If you can offer phone or online retails sales for your product or takeaway options for your food, this will help you survive. Together with 5% VAT still applying for takeaways, perhaps you can keep putting those fires out!

There are also numerous grants for all sorts of businesses, nothing to do with Coronavirus, which may be worth a bit of research.

SEISS – Already extended

There was no mention of the self employed grant which was previously extended with a maximum payable for November-December-January of a total £3,750. [EDIT: INCREASED TO £7,500 OR 80% OF PROFITS IF LOWER] With many businesses not being eligible at all so far, such as those with historical profits over £50k, presumably those exclusions need to be revisited as time goes on, as well as the amount, in the light of this lockdown. 

BBLs – Business Bounce Back Loan – to 30th November [EDIT: 31ST JANUARY]

Remember, remember not only the 5th November, but the 30th. If you’ve not yet taken out a BBLs loan for up to £50k, you may need to revisit this to help see you through. If so, your application needs to be in by 30th. [EDIT: 31ST JANUARY]

Businesses should revisit their particular business model, fixed and variable costs and how government, or other, assistance can help them put these fires out!