Summary of Government Support produced by Prager Metis LLP – Last
updated 26 March 2020
On 23 March we circulated fact sheets on the various Schemes that the Government had set up to support Businesses. Set out in the following sections is a summary of further information\resources which we have come across.
- Coronavirus Job Retention Scheme
No further details have been released by HMRC about how this scheme will operate. The ICAEW have produced a very useful summary of their understanding of how the scheme will operate along with practical examples (see here)
- Deferral of VAT and Income Tax payments
VAT payments will be automatically deferred for a period of 3 months during the period 20 March 2020 until 30 June 2020.
- VAT returns should continue to be prepared, filed and submitted as normal.
- If you file VAT returns on a quarterly VAT stagger, ending February 2020, your VAT return is still due to be filed by 7 April 2020, however your payment is optionally deferred.
- If you file VAT returns on a quarterly stagger ending March 2020, your VAT return is still due to be filed by 7 May 2020, however your payment is optionally deferred.
- If you file VAT returns on a quarterly stagger ending April 2020, your VAT return is still due to be filed by 7 June 2020, however your payment is optionally deferred.
- VAT periods ending May 2020 are filed as normal, the VAT return is filed as normal and payment for it is due, as normal, by 7 July 2020.
- Deferred payments need to be settled by 5 April 2021.
- If you wish to take advantage of the deferment scheme and you pay your VAT liability by direct debit you should cancel it to avoid the payment being made automatically.
- Please remember to reinstate the direct debit at the end of the scheme otherwise your payment will be needed to be received by HMRC on the 7th of the month rather than taken around the 10th of the month when paid by direct debit.
For the purposes of Income Tax Self-Assessment, Payments on Account which are due in July 2020 may be deferred until January 2021. Deferrals will apply automatically.
Again, this optional and tax payers may prefer to make the payment in July to avoid having to make a larger payment in January 2021.
HMRC have confirmed that the deferral of the second payment on account is available toall tax-payers and not just the self-employed as was initially advised.
Again, if you pay by direct debit and wish to take advantage of the scheme then please cancel your direct debit to avoid payment being taken.
• Statutory Sick Pay (SSP) Rebate Scheme
The Rebate Scheme is still being developed and further details are still to be announced in due course.
The ICAEW have produced a useful note on how the scheme might work. Details can be found here. Click Here.
Business rates holiday
A 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England. This will automatically apply during the 2020/21 tax year for eligible businesses.
This will be administered by your local authority. No new information has been provided, however you can find out details of who your Local Authority is through. Click Here.
- Small Business Grant Scheme
Grants of £10,000 will be made available for all businesses that are in receipt of small business rate relief or rural rate relief. The local authority will contact eligible businesses in due course.
- Retail and Hospitality Grant Scheme
Retail, hospitality and leisure businesses with property which has a rateable value between £15,000 and £51,000 will receive a grant of £25,000 per property. Relevant businesses with a property that has a rateable value of up to £15,000 will receive a grant of £10,000 per
property. As above your local authority will contact eligible businesses in due course.
- Coronavirus Business Interruption Loan Scheme
The scheme will provide eligible SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million for a period of up to 6 years. The scheme is being offered through all major banks and certain accredited finance providers.
There is a useful page on the British Business Bank website which provides details about which banks are offering the scheme, the eligibility criteria and other support available:Click Here.
- COVID-19 Corporate Financing Facility
A new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans. Applications can be made through the Bank of England.
- HMRC Time To Pay Scheme
The scheme will offer support to businesses and self -employed individuals which are in financial distress and also have outstanding tax liabilities. HMRC will agree arrangements on a case by case basis.
For further information Click Here.
- Industry\Trade Association Support
We are aware that various industry bodies and trade associations are offering grants and other support. We are compiling details and will be adding links to our webpage.