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20
Mar

Updated COVID-19 Economic Measures - 20 March 2020

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The Chancellor’s latest package of economic measures have now been announced.  We summarise these below.  It is worth noting that the detail in terms of time scales and logistics will be published in the coming days.  We will of course keep you updated of the detail once available.

Furthermore, as part of our ongoing commitment to you, members of our senior management team will be available over the weekend via telephone and/or email should you wish to speak with us.

GOVERNMENT JOB RETENTION SCHEME

Government grants will cover 80% of the salary of retained workers, up to a total of £2,500 a month.

The scheme is open to any employer in the country and it will cover the cost of wages backdated to 1st March 2020.

It is anticipated that the scheme will be open before the end of April for at least 3 months but can be extended if needed. 

There is no limit on the funding available for the scheme and it will pay to support as many jobs as needed.

VAT PAYMENTS - DEFERRED

VAT payments will be deferred for all businesses until the end of June.

Businesses will have until the end of the financial year to repay their deferred VAT bill. 

INCOME TAX PAYMENT ON ACCOUNT - DEFERRED

The next income tax payment was due by 31st July 2020.  This has now been deferred until 31st January 2021.

GOVERNMENT BACKED LOANS (Coronavirus Business Interruption Loan Scheme)

No interest will be charged for the first 12 months (previously 6 months).

ADDITIONAL HELP FOR THE SELF-EMPLOYED 

Universal Credit and Working Tax Credit will be raised by £1,000 a year.

Suspension of the minimum income floor for Universal Credit.  

A self-employed person with zero income will be able to claim Universal Credit at a similar rate to someone who is unemployed.

A self-employed person will be able to access Universal Credit at a rate equivalent to Statutory Sick Pay.

HOUSE RENTAL COSTS

Local Housing Allowance will now cover at least 30% of market rents in your area.
 

Below is a summary of announcements prior to today’s further measures, we have previously communicated this in greater detail in earlier newsletters

Business Rates:

  • No rates payable for 12 months for any business in the retail, hospitality or leisure sectors.
  • If you are in the following sectors retail, hospitality or leisure and if your rateable value is less than £51,000, you'll also receive a cash grant of up to £25,000.
  • Any business which gets small business rates relief, will receive a cash grant of £10,000 (increased from £3,000 announced in the Budget).

Government Backed Loans (Coronavirus Business Interruption Loan Scheme):

  • These should be available from Monday 23 March via the high street lenders.
  • If you expect your business to recover from the disruption because you have a solid business, you may wish to take a loan out.
  • No interest will be charged for the first 6 months (now lengthened to 12 months).
  • The interest rate will be favourable.
  • It is rumoured that terms will be 5 years for larger loans and 10 years for smaller amounts.

Mortgage Holiday:

  • At least a 3-month mortgage holiday for those in difficulty, from your lender.

Insurance Claims:

  • Insurers will pay out against policies that cover pandemics.

Universal Credit:

  • If your income has dropped you may wish to access the benefit system.
  • This was made easier as announced in the Budget.
  • Particularly relevant to the self-employed who cannot claim SSP.

Statutory Sick Pay (SSP):

  • If you're a director of a limited company, you can pay yourself 2 weeks if you need to self-isolate subject to meeting the minimum payroll requirement for SSP.
  • The government will refund this £94 per week, maximum £188, to your company.
  • It will also refund SSP for your staff for up to 2 weeks to your business or your company.
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