Business owners: Financial guidance (COVID-19)
Page updated: 29 September 2020
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. Check if you can claim back Statutory Sick Pay paid to employees due to coronavirus.
The Coronavirus Job Retention Scheme (CJRS), having already been extended, is due to expire on 31 October, and the Chancellor has announced a new scheme.
The Jobs Support Scheme will start the day after the CJRS finishes, on 1 November, and continue for six months. The scheme is aimed at supporting workers to stay in viable roles but who may be working shorter hours.
- Employees will need to be working for at least one-third of their normal hours (and be paid as normal for those hours worked);
- For each hour not worked, the employer and the government will each pay one-third of the employee’s normal pay, with the government contribution capped at £697.92 per month. This means employees will receive at least 77% of their normal pay (where the cap does not apply). Employers will be reimbursed the government contribution in arrears so as before, this will all be administered through payroll;
- The scheme is targeted at all SMEs and for larger employers only if their turnover has fallen due to the pandemic;
- It will be available throughout the UK even if the employer has not previously furloughed staff under the CJRS.
- Using the JSS will not affect entitlement to the previously-announced Job Retention Bonus Scheme.
- Businesses will not be allowed to issue redundancy notices to employees on the JSS.
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 Bounce Back Loan Scheme and the Coronavirus Business Interruption Loan Scheme. Loans are available from all the major banks and will be interest free for the first 12 months.
The Bounce Back Loan repayment periods will be extendable from six to ten years under the 'Pay As You Grow' scheme, almost halving the average monthly repayments. If businesses are struggling they will be able to choose to make their repayments interest-only, and in more severe cases suspend repayment for up to six months – and this won’t affect credit scores.
Regarding Coronavirus Business Interruption Loans, the government guarantee will be extended for up to ten years to make it easier for lenders to extend repayment periods.
The deadline for applying for all coronavirus-related loans is extended to 31 December 2020 and a new successor loan scheme will be announced in January.
VAT payments deferred were due to become payable on 31 March 2021 but can now be spread over the financial year 2021/22, interest-free. All business are eligible but will need to opt-in, and the process for opting-in is expected to be in place in the New Year.
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 online or call 0800 024 1222.
Further advice on debt is available from the Business Debtline on 0800 197 6026.