The Chancellor has introduced various packages of temporary, timely and targeted measures to support people and businesses through this period of disruption caused by COVID-19. This is a simplified guide to the financial support available.
For employees
Job retention scheme
The scheme will reimburse an employer with up to 80% of the pay of an employee who is not working but kept on the payroll (“furloughed”). Up to a maximum of £2,500 per month.
Statutory sick pay
Currently £94.25 a week, rising to £95.85 for 2020/21, would be available to employees from day one instead of day four, including for those advised to self-isolate.
Benefits
From 6 April 2020, for 12 months, the standard allowance in Universal Credit (UC) and the basic element in Working Tax Credit (WTC) will be increased by £20 a week over and above the planned annual uprating.
Further information can be found here.
For the self-employed
Self-employed income support scheme
The scheme is for those people whose income is derived from self-employment. They can secure a taxable direct grant of 80% of their average profit for the three tax years ending with the 2018/19 tax year or a shorter period (even just the 2018/19 tax year) if three years’ accounts are not available. This is subject to a maximum payment of £2500 per month.
To qualify, the 2018/19 profit or average profit for up to three years ending with 2018/19 must not exceed £50,000. Grant to run for three months and payment (representing a cumulative three months’
Benefits
The income support scheme mentioned earlier, will not be available until June. As a stopgap the Government has said that self-employed people can apply for help via the benefits system.
If someone’s self-employed income dries up, they will be able to claim employment and support allowance (ESA) and/or Universal Credit. The weekly payment for ESA is typically £73.10 a week for those 25 and over, rising to £74.35 in 2020/21). This will be claimable from day one instead of day eight.
Further information can be found here.
For businesses and employers
Job retention scheme
The scheme will reimburse an employer with up to 80% of the pay of an employee who is not working but kept on the payroll (“furloughed”). Up to a maximum of £2,500 per month, plus the associated employer national insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage.
All employers remain liable for associated employer national insurance contributions and minimum automatic enrolment employer pension contributions on behalf of their furloughed employees.
Sick Pay
Businesses with fewer than 250 employees can be refunded for the cost of SSP for up to 14 days. The size of an employer will be determined by the number of people they employed as of 28 February 2020.
Further information can be found here
For businesses and the self-employed
Grants
£10,000 grant for all small businesses that qualify for Small Business Rates Relief (SBRR) or Rural Rates Relief. For SBRR, the rateable value of the property used by the business needs to be valued at £15,000 or less. £25,000 grant for businesses in hospitality, leisure and retail whose rateable value is between £15,000 – £51,000.
Local Authorities responsible for delivering the funding to eligible businesses. They will then be reimbursed by the Government.
Further information can be found here.
Loans
Business interruption loans are available to small and medium businesses from 23/03/2020 for up to £5 million, interest free for 12 months. This scheme will help any viable business with a turnover of up to £45m.
Business rates
Business Rates holiday for businesses in hospitality, leisure and retail, plus estate agents, lettings agencies and bingo halls, for 12 months.
VAT
For the period between 20 March 2020 and 30 June 2020, businesses will not need to make a VAT payment. No special application needed. Businesses will have until the end of the 2020/21 to pay any liabilities that have accumulated during the deferral period.
Further information can be found here
Businesses and individuals are encouraged to speak to their banks as the government said mortgage lenders have agreed to support customers experiencing issues with their finances as a result of Covid-19, including payment holidays of up to three months.
You can find more information on all of the above areas here
Alternatively, anyone can contact a gov.uk adviser about problems paying taxes due to Coronavirus (COVID-19) such as: self-assessment, VAT, employers PAYE and corporation tax, by calling 0800 024 1222 or online here
# Coronavirus guide to the financial support to individuals and businesses