What help is out there for small businesses and individuals in Wales in the times of Covid-19
The coronavirus has hit us all hard. The uncertainty of how we will manage financially is just one concern. So what help is out there?
Businesses with Premises:
Business Rate Relief:
Retail, leisure and hospitality businesses with a rateable value of £500,000 or less will get one year business rates relief in the financial year 2020 to 2021.This means that you will not have to pay any business rates during this time.
This will be administered through the business rates system. You do not need to do anything. Your local authority will contact you.
Retail, leisure and hospitality businesses in Wales with a rateable value of £12,001 and £51,000 will get a grant of £25,000.
Businesses with a rateable value of £12,000 or less that are eligible for Small Business Rates Relief will get a grant of £10,000.
This will be administered through the business rates system.
Economic resilience fund
In its first week the second phase of the Economic Resilience Fund received almost 9,000 requests for support. Due to the scale of demand, Welsh Government increased the amount of funding for this phase to £300 million.
The Fund is now paused following the large number of applications to give Welsh Government an opportunity to consider what further support businesses.
The bounce back loan scheme (BBLS)
This is for small - medium size business to borrow between £2,000 and £50,000 up to 25% of turnover in 2019.
This loan is 100% guaranteed bu the government and is interest free for first year. The interest rate will be 2.5%.
Support for businesses through the Coronavirus Business Interruption Loan Scheme
The temporary Coronavirus Business Interruption Loan Scheme supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.
The government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.
The government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The scheme will be delivered through commercial lenders, backed by the government-owned British Business Bank.
There are 40 accredited lenders able to offer the scheme, including all the major banks.
Businesses with Staff:
If you aren’t able to run your business due to the virus, then you can ‘furlough’ your staff (ie give them a temporary leave of absence) and they will receive 80% of their normal pay, up to £2,500/month. This is currently a three-month scheme, backdated to 1 March and the government is proposing a grant of up to £2500 per employee per month to cover up to 80% of an individual’s salary. The purpose of the grant is to prevent redundancies.
For more information, and details on how you can claim this grant can be found here. The scheme will be open before the end of April.
If you have staff off on SSP, you may be able to claim this back from the Government, depending on how many staff your business has.
VAT registered businesses
You can defer VAT payments for 3 months. If you have a payment due between 20 March and 20 June 2020 you can defer the payment. It will still need to be paid at some point though.
Sole Traders/Self Employed:
You can apply for a taxable grant of 80% of your trading profits, up to a maximum of £2,500 per month, as long as your profit is under £50,000 a year. It is initially available for 3 months, and you are still able to work while receiving the grant. This is based on your 2018-2019 Tax Return, so if you haven’t completed this, you need to do it ASAP to be eligible. Choice Bookkeeping is happy to help with this for you!
Directors of Limited Companies
This is a more complicated area, and depending on how you pay yourself will have an impact. Please contact us at Choice Bookkeeping for details on your individual circumstances.
Those who don’t fit into any of the above:
If you don’t fit into any of the above categories (eg only started self-employment recently) you can apply for Universal Credit here.