From the Treasury confirming the cancellation of this year’s Autumn Budget to the announcement of Rishi Sunak’s Winter Economy Plan, many changes are being made by the UK Government to help stabilise the economy.
Here are the most recent updates to all of the UK schemes launched as a result of the coronavirus pandemic.
Coronavirus business interruption loan scheme (CBILS)
This scheme was launched to help small and medium-sized businesses access finance up to £5 million.
Having previously said it would close on 30 November, the Government recently announced that the scheme will now stay open until 31 January 2021. It will guarantee 80% of all loans and pay interest and any fees for the first year.
To apply for CBILS, your company has to be based in the UK and have an annual turnover of up to £45 million. You’ll also need to provide evidence that your company would be “viable” outside the global pandemic and that the crisis has “adversely impacted” your business.
Coronavirus job retention scheme (CJRS)
The CJRS, better known as furlough, was due to end on 31 October – and the Chancellor was insistent he wouldn’t change his mind.
However, in early November, Sunak announced an extension to the scheme, meaning furloughed employees will now receive 80% of their average earnings, up to £2,500, until the end of March.
At first, the CJRS was only due to be extended until December as a result of England going into a full-four week lockdown, but the Chancellor said he wanted to give people a sense of stability over the winter.
Under the terms of the extension, the Government will pay 80% of employees’ salary, whilst the employer will cover the cost of National Insurance and pensions.
Self-employment income support scheme (SEISS)
The SEISS grant was launched by the UK Government to grant critical support to self-employed individuals affected by the COVID-19 pandemic.
When initially launched, 80% of average trading profits up to £7,500 were covered, between March and May 2020.
The second grant was launched to cover 70% of average trading profits between June and August, up to a maximum of £6,570.
Previously, as part of the Winter Economy Plan, Chancellor Rishi Sunak announced a further extension to SEISS, with the first grant covering the period from November 2020 to April 2021 and offering 20% of average monthly trading profits, capped at £1,875 in total.
This was recently changed, however, so that the third grant now covers 80% of average trading profits, up to a maximum of £7,500 – a considerable improvement for self-employed people.
Bounce Back Loan Scheme (BBLS)
The BBLS was launched to provide financial support to companies across the UK that have been losing revenue and have seen their cashflow disrupted amid the COVID-19 pandemic.
Through the scheme, businesses can apply for Government-guaranteed loans of between £2,000 and £50,000, interest free for a year, with no repayments required during that period.
As of 2 November, the Government announced that the scheme will be extended until the end of January 2021.
It was also announced that, from 10 November, participating lenders in the scheme are able to offer smaller businesses across the UK a top-up to their existing BBL if they originally borrowed less than the maximum amount available to them.
Coronavirus large business interruption loan scheme (CLBILS)
This scheme helps medium and large businesses to access loans up to £200 million.
The Government offers 80% of the finance to the lender and applications for the CLBILS are now open until 31 January 2020.
Firms with a yearly turnover of £250 million can apply for loans up to £50 million.
COVID-19 corporate financing facility (CCFF)
The CCFF helps large businesses affected by the coronavirus, with the Bank of England purchasing their short-term debt.
The scheme supports businesses that have been affected by a short-term funding squeeze, and allows them to finance their short-term liabilities.
The scheme is delivered through commercial lenders and is backed by the Bank of England.
According to the Government, the scheme will operate for at least 12 months, and for as long as steps are needed to relieve cash flow pressures on firms that make a material contribution to the UK economy.
In September 2020, Sunak announced that businesses who deferred their VAT due from 20 March to 30 June 2020 will now have the option to make smaller payments over a longer period, again as a result of the COVID-19 pandemic.
Instead of paying the full amount by the end of March 2021, businesses have the opportunity to make smaller payments up to the end of March 2022, without paying any interest.
In order to qualify for the deferral, businesses need to opt in to the scheme.
VAT liabilities due between 20 March and 30 June 2020 won’t need to be paid in full until the end of March 2022.
Businesses that can pay their deferred VAT can still do so by 31 March 2021 if they wish.
To speak about your business and the support schemes that apply to you, get in touch with us.