New Lockdown Grants For Retail, Leisure and Hospitality Sectors

The Chancellor has announced grants for businesses in the retail, hospitality and leisure sectors.

The one-off top-up grants will be provided on a per property basis to businesses closed as a result of the latest restrictions as follows:

  • £4,000 for businesses with a rateable value of £15,000 or under
  • £6,000 for businesses with a rateable value between £15,000 and £51,000
  • £9,000 for businesses with a rateable value of over £51,000

A further £594 million is also being made available for local authorities and the devolved administrations to support other businesses not eligible for the grants, that might be affected by the restrictions. The new one-off grants are in addition to the existing business support, including grants worth up to £3,000 for closed businesses, and up to £2,100 per month for impacted businesses once they reopen. We will continue to keep you updated as this evolves.

Job Retention Scheme

It was announced in the Chancellor’s March budget that the Government’s Job Retention (Furlough) Scheme has been extended to 30 September 2021. This enables employees to receive 80% of their current salary for hours not worked, up to a maximum of £2,500. The extension sees no changes for employees. Any employee on furlough will continue to receive at least 80% of their current salary for hours not worked.

Employers will have to cover national insurance and pension contributions, but will not be required to pay a salary contribution to furloughed workers from April to June.  From July, this changes and employers will have to contribute at least 10% of the salary cost. This increases to 20% of the salary cost in August and September.

 

Restart Grants for Non-Essential Businesses

The Restart Grant scheme is for businesses in the non-essential retail, hospitality, leisure, personal care and accommodation sectors. Eligible businesses will receive a one-off grant of up to £18,000, to reopen safely as COVID-19 restrictions are lifted.

Your business may be eligible if it:

  • Is based in England
  • Is rate-paying
  • Is in the non-essential retail, hospitality, accommodation, leisure, personal care or gym sectors
  • Was trading on 1 April 2021

Local councils will use their discretion to determine whether businesses meet the eligibility criteria for this grant scheme. Eligible businesses will be paid:

  • A one-off grant of up to £18,000 in the hospitality, accommodation, leisure, personal care and gym sectors
  • A one-off grant of up to £6,000 in the non-essential retail sector

Visit your local council’s website to find out how to apply.

Self-Employment Income Support Scheme

The SEISS has now been extended to 30 September 2021 with a 4th and 5th round of the grant being announced. The two grants will cover the February to April and May to September periods respectively.

Self-employed individuals can apply for the grant to cover a percentage of their average monthly profits.

Individuals can check if they can claim a grant through the Self-Employment Income Support Scheme, and the scheme now allows individuals who became self employed in 2019/20 to apply for a grant.

Guidance is available on how HMRC will work out your trading profits and non-trading income if you’re self-employed.

The Growth Hub can help with the process or answer questions here.

For more information on the 4th and 5th round of this grant, click here. Applications will open late April.

Recovery Loan Scheme

A new loan scheme has launched which will support UK businesses as they grow and recover from the disruption of the COVID-19 pandemic. The Recovery Loan Scheme has replaced the current Bounceback and CBILs loan schemes, which means that businesses of any size can continue to access loans now the previous COVID-19 loan schemes have closed.  

The government will provide an 80% guarantee to lenders to allow businesses to access loans from £25,000 up to £10m.  The scheme will be open to all businesses, including those who have received support from the previous loan schemes. 

The finance can be used for any legitimate business purpose, including growth and investment. 

The scheme launched on 6 April and is open until 31 December, subject to review. Loans are available through a network of accredited lenders 

 Find out more on the government website. 

Community Renewal Fund

The UK government is providing an additional £220 million funding through the UK Community Renewal Fund to help local areas prepare for the launch of the UK Shared Prosperity Fund in 2022. This Fund aims to support people and communities most in need across the UK to pilot programmes and new approaches and will invest in skills, community and place, local business, and supporting people into employment.

More information will be available on your local council’s website soon.

Welcome Back Fund

The Welcome Back Fund is providing councils across England a share of £56 million from the European Regional Development Fund (ERDF) to support the safe return to high streets and help build back better from the pandemic.

The fund will allow local authorities in England to put in place additional measures to create and promote a safe environment for local trade and tourism, particularly in high streets as their economies reopen.

This funding builds on the £50 million Reopening High Street Safely Fund (RHSSF) allocated to councils in 2020 and forms part of the wider support government is providing to communities and businesses.

More information will be available on your local council’s website soon.

Help to Grow Programme

The government’s new Help to Grow programme will help small and medium sized businesses to learn new skills, reach new customers and boost profits. 

Businesses can get: 

  • an Executive Development programme that could help you improve business performance and growth potential through Help to Grow: ManagementThe Government will subsidise the costs of training and support through the scheme by 90%. 
  • free online advice and up to £5,000 off software that could help you save time and cut costs through Help to Grow: Digital 

Find out more and register your interest on the government’s dedicated Help To Grow website. 

Apprenticeship and Traineeship Incentives

Businesses who employ new apprentices will be able to claim incentives of £3,000 per apprentice of any age. This is an extension of the apprenticeship hiring incentive to September 2021 and an increase of payment from £1,500 to £3,000.  

Businesses who provide 16-24 year olds with work placements, known as traineeships, in the 2021/22 academic year will be ablto claim £1,000 per placement.   

A new ‘flexi-job apprenticeship programme will enable apprentices to work with a number of employers in one sector.  

More information will be provided here when it is published by the government. In the meantime, you can find out more about the recent budget announcements on the government website. 

VAT Reduction and Deferral

It was announced in the budget that the temporary reduced rate of VAT at 5% for businesses in the tourism and hospitality sector will be extended until 30 September.

From 1st October, the VAT rate will increase to 12.5% before returning to the standard rate of VAT from April 2022.

Businesses that took advantage of the VAT deferral on VAT returns from March to June 2020 can now opt to pay the deferred VAT in instalments from March 2021, rather than pay the deferred VAT in a single payment.

Businesses that wish to pay in instalments must apply for the VAT Deferral New Payment Scheme.  It was also stated that VAT thresholds will not change before 1 April 2024.

Business Rates

The Chancellor has announced that the business rates relief has been extended and then discounted.

For eligible retail, hospitality and leisure businesses and nurseries there is a 100% relief on business rates from April to 30 June 2021.

From July, eligible businesses will have their rates discounted by two thirds (66%) until 31st March 2022.

Your local council should apply the discount automatically so contact them if you’re not getting a relief you think you’re entitled to. Find out more here.

Taxation

If you did not make a Self-Assessment Tax payment in July 2020, the deadline to pay your Self-Assessment bill is 31st January 2021, or 31st March 2021 for hospitality and tourism businesses. You may be eligible to set up a payment plan online or may be able to set up a Time to Pay Arrangement with HMRC if you’re unable to pay any other taxes in full. This lets you spread the cost of your tax bill by paying what you owe in instalments.

Find more information on this here and contact HMRC if you cannot pay your tax bills because of coronavirus here.

Insurance Pay Outs for Small Businesses

Thousands of small businesses with business interruption insurance policies will receive pay-outs from their insurance company to cover losses from the first national lockdown.

During the lockdown of last spring, many businesses had their claims refused by insurers on the basis that only specialist policies covered such unprecedented restrictions.

However, a selection of policy wordings has been tested in court, with the Supreme Court ruling largely in favour of small businesses.

If your business had business interruption insurance cover before the first national lockdown in March 2020, now would be the time to get in touch with your insurance provider to make a claim.

UK Export Finance (UKEF)

UK Export Finance provides financial support for businesses exporting goods and services.

The Export Working Capital Scheme provides partial guarantees up to 80% of a loan to help UK exporters access working capital finance for specific export-related contracts.

The Direct Lending Facility Scheme loans within an overall limit of £8 billion to overseas buyers, allowing them to finance the purchase of capital goods and/or services from UK exporters. The loans can be made in up to eight currencies, with a value limit of £200 million and a fixed rate of interest.

Enquiries for the two options can be sent by email to: customer.service@ukexportfinance.gov.uk

COVID-19 Corporate Financing Facility (CCFF)

Under the COVID-19 Corporate Financing Facility (CCFF), the Bank of England will buy short-term debt from large companies.

Beginning in March 2020, the scheme is due to 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.

Find out more here.

Further Financial Support from Government

The following schemes were announced in the March budget:

Extension to loss carry back 

 Unincorporated businesses that are not members of a corporate group will be able to claim tax relief for up to £2 million of losses in each of the 2020/21 and 2022/22 financial years.  

 Corporation tax 

 Businesses with profits of less than £50,000 will continue to pay 19% Corporation Tax. The rate of corporation tax will increase to 25% on profits of £250k and more from April 2023.   

 New super-deduction capital allowance for business investment 

 For the next two years businesses that invest in plant and machinery for their businesses will be able to reduce their tax bill through a 130% upfront capital allowance super-deduction.   

 More information will be provided here when it is published by the government. In the meantime, you can find out more about the recent budget announcements on the government website.