Summary of COVID 19 support for businesses
The past week has been a time of uncertainty for businesses and the UK Government and Stormont Executive are continually releasing details of support packages in response to the COVID 19 crisis.
With many businesses closing temporarily, business owners will have many questions as to the support packages that are available but also how to protect their business during this period to ensure that it remains viable in the future.
We have set out the steps that businesses should consider, and the support available, to assist businesses through this period.
Last Updated 1st June.
Assess your cashflow requirementsBefore you apply for the available loan schemes, it is important to understand what your cashflow requirement is on a monthly basis. |
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Income |
Project business income over the next 3 to 6 months: - What work is in the system and is it guaranteed to proceed? |
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Expenditure |
Project monthly expenditure over the next 3 to 6 months: - Consider staffing level requirement based on projected sales/income (support available via Employee Retention Scheme). |
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How can we assist? |
By projecting forward your income and expenditure over the period you will be able to understand what the cashflow requirement is on a monthly basis and thus assess what the most appropriate method of financial support is. If required, we can provide assistance in helping you to understand your monthly/weekly cashflow requirement. Contact your client manager or a member of our Advisory Team. |
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Financial Support Available |
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Employee and Self Employed salary support |
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Coronavirus Job Retention Scheme |
Under the Coronavirus Job Retention Scheme, UK employers may be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.
On 4th April 2020, the UK Government said that all employers are eligible to claim under the scheme and the government recognises different businesses will face different impacts from coronavirus. The Scheme has been extended to 31st October 2020 and there will be no changes until the end of July.
It has been confirmed that workers will, through the combined efforts of government and employers, continue to receive the same level of support as they do now, at 80% of their salary, up to £2,500.
Until 31 July 2020, the associated employers’ national insurance contributions on this amount and the minimum automatic enrolment employer pension contributions on that wage can be included in the employers’ claim.
From 1 August 2020, employers will pay ER NICs and pension contributions on employees’ furlough grant
From September 2020, the employer contribution will be 10% plus ER NICs and pension contributions
In October, the employer contribution will be 20% plus ER NICs and pension contributions
From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back part time and they will be responsible for paying their wages while in work. |
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Eligibility |
Any entity with a UK payroll can apply. You must have: - created and started a PAYE payroll scheme on or before 19 March 2020 - enrolled for PAYE online - this can take up to 10 days. - a UK bank account. |
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How to access the scheme
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You will need to: - Designate affected employees as ‘furloughed workers'. - discuss with their staff and make any changes to the employment contract by agreement. Written agreement is required and documentation must be kept for 5 years – please note changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation. - Submit information to HMRC about the employees that have been furloughed and their earnings through an online portal
Claims can be made via an online portal
For further information please see our detailed article. |
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Considerations / Comments |
In addition, we expect strict implementation of this measure by HMRC who will be able to cross-check the applications against PAYE records for each business.
For this reason and for HR employment reasons, it is advisable that businesses should be clear in documenting their decisions so they can evidence that the actions taken are proportionate and appropriate at this stage. |
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Support for paying sick pay to employees |
The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the current rate of SSP that they pay to current or former employees for periods of sickness starting on or after 13 March 2020. The repayment will cover up to 2 weeks starting from the first day of sickness, if an employee is unable to work because they either: - have coronavirus - cannot work because they are self-isolating at home - are shielding in line with public health guidance
Employees do not have to give you a doctor’s fit note for you to make a claim
Employers should keep the following records for at least three years following a claim: - the reason why an employee could not work - details of each period when an employee could not work, including start and end dates - details of the SSP qualifying days when an employee could not work - National Insurance numbers of all employees who you have paid SSP to
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Eligibility |
Your business is UK-based. Your business is small or medium-sized and employs fewer than 250 employees as of 28 February 2020. The scheme covers full-time employees, part-time employees, employees on agency contracts, flexible or zero hours contracts. |
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How to access the scheme
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The online service is now open: |
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Self – Employment Income Support Scheme |
The UK Government introduced the scheme to provide support for self-employed individuals or members of a partnership.
It provides a taxable grant worth 80% of your trading profits up to a maximum of £2,500 a month. It was originally available for 3 months but has now been extended for a further three months but at a lower rate of 70% of trading profits up to a maximum of £2,250 a month.
The grant will be subject to Income Tax and National Insurance contributions but does not need to be repaid.
If you receive the grant you can continue to work or take on other employment including voluntary work.
For further information see our detailed article.
Interim support is available while waiting for Universal Credit https://www.nidirect.gov.uk/articles/coronavirus-covid-19-and-benefits |
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Eligibility |
Open to self-employed individuals or members of a partnership subject to trading profits being no more than £50,000 and more than half of total income for either: - the tax year 2018 to 2019 - the average of the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019
You can claim if you’re a self-employed individual or a member of a partnership and you: - have submitted your Self-Assessment tax return for the tax year 2018 to 2019 - traded in the tax year 2019 to 2020 - are trading when you apply, or would be except for coronavirus - intend to continue to trade in the tax year 2020 to 2021 - have lost trading profits due to coronavirus
You will need to confirm to HMRC that your business has been adversely affected by coronavirus. The Government have confirmed that the eligibility criteria will remain the same for the second grant.
You can check eligibility at the following link: https://www.tax.service.gov.uk/self-employment-support/enter-unique-taxpayer-reference |
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How to access the scheme |
Claims can be made via the following link: https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income-support-scheme
If you missed your allocated time slot, HMRC have advised that you can claim at any time.
You will receive your payment within 6 working days.
If you’re unable to claim online you should call HMRC on 0800 024 1222.
The first grant is currently open for eligible individuals and you must make your claim by 13th July 2020.
The second grant is expected to open for claims in August 2020 and further information is to be published on 12th June 2020. |
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How can we assist? |
You can speak to our payroll department to discuss any queries you may have about the payment of SSP. |
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Grant Aid |
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Small Business Grant |
A grant of £10,000 will be provided to all small businesses who are eligible.
Further information is required for to ensure that that the grant is being paid to the small business who occupies the property, and not a landlord or letting agent and therefore a different application process is required.
The grant will be treated as taxable income.
THIS SCHEME IS NOW CLOSED! |
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Eligibility |
Businesses who are eligible for the Small Business Rate Relief Scheme and who currently benefit from Industrial Derating with a rateable value below £15K. The ratings system will be used as the mechanism to identify eligible businesses in Northern Ireland. Last year’s rating list will be the basis for payment.
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How to access the scheme
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Payments will be made directly into the bank accounts of eligible businesses. Apply via the following link https://www.covid-19smallbusinessgrants.economy-ni.gov.uk/
You will need: - Your Ratepayer ID (shown on your rate bill) For rental properties with a sole tenant and properties with a Total NAV of £1,590 or below the following application form should be used: https://www.covid-19smallbusinessgrants.economy-ni.gov.uk/RentalPropertiesandNAVBelow1590 |
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Retail, hospitality and tourism grant |
A grant of £25,000 will be provided to companies in the retail, tourism and hospitality sectors with a rateable value between £15,000 and £51,000. This should assist 4,000 businesses. THIS SCHEME IS NOW CLOSED! |
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Eligibility |
Businesses must operate in a premises in the retail, hospitality, tourism or leisure sectors and full list of business types is available on the following site:
Businesses with multiple premises meeting the Total Net Annual Value criteria will only be eligible for one grant of £25,000.
Businesses who have already received a £10,000 grant under the Small Business Grant Scheme, and who have an additional property which falls within the £15,001 to £51,000 Total Net Annual Value and meets the other eligibility criteria for the £25,000 Business Grant Scheme, are eligible to apply. |
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How to access the scheme |
Apply via the following online form: https://www.covid-19smallbusinessgrants.economy-ni.gov.uk/BusinessGrant25K/ You can check eligibility by entering your Rates ID and Occupancy ID. |
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Micro-business Hardship Fund |
The NI Executive has launched a new NI Micro-business Hardship Fund to help Northern Ireland based micro-businesses and social enterprises unable to access other regional and national COVID-19 support measures.
The level of Hardship Fund grant will be up to £10,000 for businesses which pay business rates on premises and up to £5,000 for those that do not pay business rates. Businesses within each category will receive the same amount but the final amount awarded will depend on the number of successful applications.
The fund will be administered by Invest NI.
Only one grant will be paid to each eligible business, irrespective of how many properties the business occupies. |
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Eligibility |
The business must be based in Northern Ireland.
At 29 February 2020, the business must have employed between one and nine employees paid via PAYE except where the sole employee is the business owner or company director. The number of employees will be based on headcount.
Since 1 March 2020, the business must have experienced a reduction in turnover in excess of 40% as a direct result of the COVID-19 pandemic or associated Government restrictions.
There are a number of exclusions: - Primary agricultural producers i.e. those primarily concerned with crop or animal production or forestry or logging or fisheries or aquaculture. However, agricultural businesses associated with the processing, marketing and retail of agricultural products can apply to the fund. - Businesses eligible for the following £10K, £25K or childcare support grants - Charities or social enterprises with charitable status. - Social enterprises that receive less than 60% of revenue from trade in goods and/or services. |
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How to access the scheme |
You can use the online eligibility checker to find out if you can apply for the NI Micro-business Hardship Fund https://www.investni.com/ni-micro-business-hardship-fund If you are eligible you will be directed to an online application form.
The scheme closes for applications on 12th June 2020. |
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Intertrade Ireland |
Intertrade Ireland are offering two funding programmes to support businesses:
Emergency Business Solutions Professional advice, to the value of £2,000/€2,250 inc VAT (100% funded), is available for cross-border companies in manufacturing and tradable services, to address key business challenges related to Covid-19. Applicants can request a preferred provider for the advice and CavanaghKelly are on the Intertrade Ireland list of preferred providers. https://intertradeireland.com/sales-growth/covid-19-supports/covid-19-emergency-business-solutions/
E-Merge The E-Merge programme provides £2500/€2800 fully funded consultancy support to help businesses develop online sales and eCommerce solutions. |
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Eligibility |
Applicants must be a manufacturing or tradable service business registered on the island of Ireland (EBS programme only). The must: - engage in cross border trade - have a satisfactory trading history (min. 18 months & established turnover) - have the capacity to deliver the project - have less than 250 employees and annual turnover of less than £40million (or Euro Equivalent) |
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How to access the scheme |
Emergency Business Solutions https://www.surveymonkey.co.uk/r/GMPCJKC E-Merge |
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Finance available |
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Current Funders |
Many banks are offering deferred loan repayments, interest only periods, overdraft extensions or increases on current loan facilities for current customers. Banks are dealing with business requests on a case by case basis. Note that cancelling direct debits without agreement can impact your credit score so ensure that you have agreed any changes to payments with banks, HMRC and suppliers. |
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Bounce Back Loan |
From Monday 4th May, small business owners can apply to accredited lenders for the Bounce Back Loan Scheme.
The key features of the scheme are: - Small businesses can borrow between £2,000 and £50,000 up to 25% of annual turnover - No repayments during first 12 months - Application via online form - No interest payable for first 12 months - Flat rate of 2.5% interest will be charged on loans after 12 months - Lender has a 100% government backed guarantee against the loan - Borrower remains liable for 100% of the debt - Lenders are not permitted to take personal guarantees or take recovery action over a borrower’s personal assets (i.e. home)
Any business that has already taken out a Coronavirus Business Interruption Loan of £50,000 or less can apply to have these switched over to this generous new scheme.
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Eligibility |
You can apply for a loan if your business: - is based in the UK - has been negatively affected by the coronavirus
The following businesses are not eligible to apply: - banks, insurers and reinsurers (but not insurance brokers) - public-sector bodies - state-funded primary and secondary schools |
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How to access the scheme
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Businesses should apply via their own bank (if it is accredited). A list of accredited banks are available on the British Business Bank website.
In most cases you will require the following information to apply: - Business bank account and sort code - Company name, address and company registration number (where applicable) - Turnover for 2019 - Requested loan amount
Ulster Bank https://digital.ulsterbank.co.uk/business/support/service-status/coronavirus/bounce-back-loan.html
Danske
Santander https://www.santandercb.co.uk/bounce-back-loan-scheme-bbls
HSBC https://www.cbil.business.hsbc.co.uk/bbls/6791eb14-173e-4010-86b6-a8fcb1eeeeda
Barclays https://www.barclays.co.uk/business-banking/borrow/bounce-back-loan-scheme/
Bank of Ireland https://www.bankofirelanduk.com/business/business-covid-hub/bounce-back-loan-scheme-bbls/
AIB (NI) |
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Coronavirus Business Interruption Loan Scheme |
A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank (via accredited providers), aims to support primarily small and medium-sized businesses (SMEs) to access bank lending and overdrafts. Access to the scheme has been opened up to those smaller businesses who would have previously met the requirements for a commercial facility but would not have been eligible for CBILS. Insufficient security is no longer a condition to access the scheme. The expanded scheme will be operational with lenders from Monday 6 April 2020. It offers: - Finance of up to £5m on a term of up to 6 years |
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Eligibility |
You are eligible for the scheme if: - Your business is UK based, with a turnover of no more than £45 million per year. - You have a borrowing proposal which the lender would consider viable, were it not for the current pandemic. - You self-certify that it has been adversely impacted by the coronavirus (COVID-19). |
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How to access the scheme
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The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks will offer the Scheme once it has launched (not that AIB are not participating in the scheme). There are 40 accredited providers in all and 22 participating lenders in Northern Ireland You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them. www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/ |
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Coronavirus Larger Business Interruption Loan Scheme |
The new Coronavirus Large Business Interruption Loan Scheme (CLBILS) will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £500 million. Facilities backed by a guarantee under CLBILS will be offered at commercial rates of interest. We expect the scheme to be delivered through commercial lenders. The government will provide lenders with an 80% guarantee on individual loans for businesses that would be otherwise unable to access the finance they need. Lenders will still be expected to conduct their usual credit risk checks. The new scheme will launch later this month and will support a wide range of businesses to access finance products including short term loans, overdrafts, invoice finance and asset finance. |
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Eligibility |
To be eligible, businesses must: - be UK-based in its business activity - would consider viable, were it not for the COVID-19 pandemic |
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How to access the scheme |
The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website.
You should talk to your bank or finance provider (not the British Business Bank) as soon as possible and discuss your business plan with them.
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COVID-19 Corporate Financing Facility (Larger Companies only) |
Under the new Covid-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies. This will support your company if it has been affected by a short-term funding squeeze, and allow you to finance your short-term liabilities.
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Eligibility |
UK incorporated companies that make a material contribution to the economic activity in the UK, including those with foreign-incorporated parents and with a genuine business in the UK; companies with significant employment in the UK; firms with their headquarters in the UK. The facility is open to firms that can demonstrate they were in sound financial health prior to the shock. |
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How to access the scheme |
Information is available on Bank of England website: https://www.bankofengland.co.uk/markets/market-notices/2020/ccff-market-notice-march-2020 |
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How can we assist? |
Depending on your financial situation, banks may require additional information in order to make changes to current facilities or for new applications. We can assess finance requirements and provide cashflow projections to banks. We can assist in the preparation of business continuity plans where required. |
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Rates |
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Rates bill |
Rate bills for 2020-21 were due to be issued in April 2020. To avoid placing financial pressure on ratepayers affected by COVID-19, rate bills will not be issued until July 2020. |
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Eligibility |
All rate payers. |
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How to access the scheme |
This will happen automatically. |
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Business rates |
There will be a four-month rates holiday for all business ratepayers, excluding public sector and utilities. This means that no rates will be charged for April, May June and July 2020. This automatically reduces the 2020-21 annual rate bill for business ratepayers by 25 per cent. This amount does not need to be paid back. The rates holiday has been extended up to 31 March 2021 for sectors hit hardest by COVID-19 including hospitality, tourism and leisure, retail (excluding certain supermarkets and off-licences), childcare and airports. |
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Eligibility |
All businesses excluding public sector and utilities. |
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How to access the scheme |
This will happen automatically. |
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HMRC |
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VAT |
The government will be automatically deferring business payments for Valued Added Tax (VAT).
The deferral will apply from 20 March 2020 until 30 June 2020.
You can only defer quarterly and monthly VAT returns’ payments for the periods ending in February, March and April. |
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Eligibility |
All UK businesses are eligible. |
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How to access the scheme
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This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. Please note that if you pay your VAT by direct debit then you will have to cancel this or it will automatically be paid. VAT refunds and reclaims will be paid by the government as normal. https://www.nibusinessinfo.co.uk/content/coronavirus-deferred-vat-payments |
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Income Tax for Self-employed |
If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. |
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Eligibility |
If you are self-employed you are eligible. |
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How to access the scheme
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This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period. HMRC has also scaled up its Time To Pay arrangement, which is a method of spreading your business tax payments over a longer period of time in a more affordable way. It is available to all businesses and individuals who are in temporary financial distress as a result of COVID-19 and have outstanding tax liabilities. If you are having trouble paying your tax bill or may struggle to meet your tax obligations in the future, call the HMRC Coronavirus Helpline.
HMRC Coronavirus Helpline Telephone: 0800 015 9559 https://www.nibusinessinfo.co.uk/content/coronavirus-deferred-income-tax-payments |
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How can we assist? |
We can liaise with HMRC in relation to any VAT or PAYE issues. Should HMRC require cashflow projections to consider repayment options for legacy liabilities, we can assist you in the preparation of this information. |
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Other actions |
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Rent |
If you pay commercial rent, contact your landlord to negotiate a reduction in rent over this period.
New legislation will mean that landlords will be required to give private tenants a 12-week notice to quit period. The Bill was passed by the Assembly on Tuesday 28 April 2020. Conor Murphy has appealed for commercial landlords to show leniency to tenants who are experiencing difficulty paying rent on commercial leases due to the current circumstances. There is a provision into the Coronavirus Act 2020 that protects commercial tenants in situations where non-payment of rent would normally enable a landlord to treat a lease as forfeited but it seems that some landlords are seeking to enforce the right of repossession for non-payment of rent. |
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Utility costs |
If you will struggle to pay your utility bill, contract your provider to discuss a payment plan over the short term. |
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Water and Sewage bills |
NIW have confirmed that water and sewerage bills for business and non-domestic customers will be held back until July 2020. Non-domestic charges for water and sewerage which would have been billed during the postponement period will be included in bills issued once billing resumes.
In addition, the annual increase in non-domestic water and sewerage charges which was effective from 1 April 2020 has now been deferred until September 2020. |
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Insurance |
Review your insurance policy to determine if you have business interruption cover and whether it covers Covid19. Many insurance companies have advised that Covid19 will not be covered under this clause. |
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Consider opportunities |
In this difficult time, businesses may be forced to develop new ways of doing business. Consider how you can do business differently – online opportunities, new lines of business. Take the time now to consider future strategy, look at the things that you didn’t have the time to do before, everyone has a list! |
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InvestNI |
Invest NI are offering consultancy support throughout COVID 19 and are working with DfE to develop business continuity programmes for all businesses across NI. |
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If you or your business are in the unfortunate position that you are concerned about the financial viability of your business or personal position, we have an experienced team who can assist you in considering your options and identify possible solutions.
Whilst every effort has been made by CavanaghKelly to ensure the accuracy of the information here, it cannot be guaranteed and neither CavanaghKelly nor any related entity shall have liability to any person who relies on the information herein. Information given here is for guidance only. Detailed professional advice should be taken before acting on any information contained herein. If having read the guidance here, you would like to discuss further; a member of our team would be pleased to help you.