Business owners: Financial guidance (COVID-19)

If you run your own business, there are a number of measures available to help you throughout this period.

If you employ fewer than 250 people, Government will refund the cost of Statutory Sick Pay (SSP) for up to 14 days. As a director you can also pay yourself SSP for two weeks if you need to self-isolate, subject to meeting the minimum payroll requirement for SSP.

If you are forced to close temporarily because of coronavirus or there is insufficient work for your employees and they at risk of redundancy, you can apply to the government’s Coronavirus Job Retention Scheme.

Government grants available through HMRC will enable you to pay 80% of the salary of PAYE employees who would otherwise have been laid off during the crisis. The scheme will open before the end of April is open to any employer. Wages can be backdated to 1 March 2020 for any worker who was in employment on 28 February 2020.

As an employer you will need to designate affected employees as ‘furloughed workers’ and notify them of this change. Changing the status of employees remains subject to existing employment law, so depending on the employment contract may be subject to negotiation.

You will then need to submit details of furloughed employees to HMRC through a new online portal. HMRC will set out further details on the information required. HMRC will reimburse you 80% of furloughed employees wage costs, up to £2,500 per month.

If you have business interruption insurance that includes cover for either pandemics or government-ordered closures, you should be able to make a claim on your policy. The government and insurance industry confirmed on 17 March 2020 that the advice given to avoid pubs, theatres and so on is sufficient to make a claim, providing all other terms and conditions are met. Insurance policies vary greatly so you should check your policy and contact your provider.

To assist with short-term cash flow, loans are available through the Coronavirus Business Interruption Loan Scheme. Available from 23 March, loans are available from all the major banks and will be interest free for the first 12 months. Loans are available to UK based businesses with a turnover of less than £45m. The borrower remains liable for 100% of the debt and can apply to receive up to £5m.

VAT payments are automatically being deferred, meaning businesses will not need to make their VAT payment until the end of June 2020. You will then have until the end of the 2020-21 tax year to settle any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by government as usual.

If your businesses has an outstanding tax bill HMRC’s Time to Pay scheme can enable you to delay payment. Contact HMRC’s dedicated Coronavirus Helpline on 0800 0159 559.

Further advice on debt is available from the Business Debtline on 0800 197 6026.