The Bank of England has temporarily reduced the Bank Rate to 0.1 per cent. It has taken further measures to help ensure that this rate reduction will translate through to the real economy and that capital will be available for new lending. As the virus progresses, and it's impact understood, further updates will be provided.
In the budget announced 3rd March, the Chancellor of the Exchequer Rishi Sunak pledged extensions to furlough, self-employed support, business grants, loans and VAT cuts. The Government is committed to protect livelihoods of those hit hardest in this challenging time. This is a particularly useful tool which can help guide you through the relevant support you may need.
Coronavirus Job Retention Scheme
It has been announced that the Coronavirus Job Retention Scheme will stay open until 30th September 2021. All employers with a UK, Isle of Man or Channel Island bank account and a UK PAYE scheme can claim the grant. They do not need to have previously claimed before 30th October 2020 in order to do so.
The level of grant available for an employer under the scheme will remain the same until 30th June 2021. To be eligible for the grant you must continue to pay your furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they spend on furlough.
From 1st July 2021 the level of grant will be reduced and from this point employees will be asked to contribute in part towards their furloughed employees’ wages. Employers contributions will be 10% in July and 20% in August and September.
In the recent budget it was announced that for the first three months of the 2021/22 financial year (April to June), there will be a 100% business rates relief for properties in the retail, hospitality and leisure sectors. This is an extension of the 100% business rates relief available throughout 2020/21. From July 2021 those properties will get a 66% relief until March 2022 up to a total value of £2 million. This support means that 750,000 retail, hospitality and leisure properties in England will pay no business rates for three months from 1 April when combined with Small Business Rates Relief.
Businesses that were legally allowed to open during the national lockdown beginning on 5th January 2021 will have their discount for 1 July 2021 to 31 March 2022 capped at £105,000 rather than £2 million.
Children’s nurseries will also get 100% business rates relief from April to June 2021, followed by 66% relief until March 2022. As was the case in 2020/21 the relief will be available for properties occupied by providers on Ofsted’s Early Years Providers.
Grants and Schemes
The March budget included a new £5 million Restart Grant scheme to support businesses throughout the 2021/22 financial year and reopen the high street after lockdown. The Restart Grant offers a one off cash grant of up to £18,000 to businesses including non-essential retail, hospitality, accommodation, leisure, personal care and gym business and will be allocated by local authorities.
The government have also launched the Recovery Loan Scheme to replace previous government guaranteed schemes that ended on 31st March, including the Bounce Back Loan Scheme and the Coronavirus Business Interruption Loan Scheme. Under this scheme businesses can apply for a loan between £25,000 and £10 million and loans will be 80% backed by the government. This gives a guarantee to lenders if businesses are unable to pay back their debt. This scheme is set to run until 31st December 2021.
In order to best help businesses in reopening the chancellor announced in the March budget the extension of the VAT discount to 5% for food and drink sold in pubs and restaurants. This extension will last until September after which it will increase to 12.5% for a further six months.
More advice and support
Full information on the available support from the government can be found here.
UK Finance are also offering business support and can be contacted via firstname.lastname@example.org.
Small Business Britain have launched 'The Big Support' Campaign, directing businesses to business and mental health support.