Government support for business
This page provides advice and information about Government support for businesses during the coronavirus pandemic.
Navigating Government support
The Government has launched a new tool to help businesses find coronavirus financial support. After answering a series of questions, businesses are signposted to a list of support they may be entitled to. Visit the tool at www.gov.uk/business-coronavirus-support-finder.
Paying your staff
Coronavirus Job Retention Scheme
Under the Government’s Coronavirus Job Retention Scheme, all UK employers with a PAYE scheme will be able to access support to continue paying their employees’ salary for those who would otherwise have been laid off due to COVID-19.
To access the scheme, employers need to designate affected employees as ‘furloughed workers’ and submit information to HMRC, which will reimburse 80% of furloughed workers’ wage costs up to £2,500 per month. The scheme opened to claims on 20 April 2020.
Since 1 July 2020, employers can bring back to work employees that have previously been furloughed for any amount of time and any shift pattern, while still being able to claim the Coronavirus Job Retention Scheme grant for their normal hours not worked. When claiming the grant for furloughed hours employers will need to report and claim for a minimum period of a week.
Further guidance on flexible furloughing and how employers should calculate claims has been published and can be found here: https://bit.ly/2zdheFn.
From August 2020, the level of government grant provided through the scheme will be slowly tapered as set out below:
- June and July: The Government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
- August: The Government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions – for the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed.
- September: The Government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 14% of the gross employment costs the employer would have incurred had the employee not been furloughed.
- October: The Government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.
On 8 July, the Chancellor announced a Job Retention Bonus will be introduced to help firms keep furloughed workers. UK employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of 31 January 2021.
Eligibility and applying to the scheme
HMRC has published updated guidance about who can use the scheme. The guidance covers:
- The basis for furlough pay for employees furloughed on return from leave, including maternity, paternity, sick, adoption, shared parental and parental bereavement leave.
- Furloughing employees subject to TUPE transfer, business reorganisation and payroll consolidation.
- The position of contractors in scope of IR35 in the public sector.
- What information employers need to claim the grant.
- The circumstances where an employee should not be furloughed by multiple employers.
The Government also made a number of updates to the guidance on the Coronavirus Job Retention Scheme in July:
- New guidance has been published on claiming for individuals who are paid through PAYE but not necessarily employees in employment law.
- Guidance on calculating how much you can claim has been updated with information on claim periods ending on or before 31 August 2020.
- Information has been added to clarify that employers can continue to claim for employees while they are serving a statutory notice period.
- Information has been added about the process HMRC is developing to recover overclaimed grant amounts through the tax system.
The Government has also published a step by step guide about the information employers need to provide to claim for their employees’ wages through the scheme. Read the guidance at www.gov.uk/government/publications/coronavirus-job-retention-scheme-step-by-step-guide-for-employers.
Plan for Jobs 2020
The Chancellor of the Exchequer, Rishi Sunak, presented his ‘Plan for Jobs’ to Parliament on Wednesday 8 July 2020, to outline how the government will boost job creation in the UK.
The plan includes:
- A Job Retention Bonus that will be introduced to help firms keep furloughed workers. UK Employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of 31 January 2021.
- A new £2 billion Kickstart Scheme will be launched to create hundreds of thousands of new, fully subsidised jobs for young people across the country. Those aged 16-24, claiming Universal Credit and at risk of long-term unemployment, will be eligible. Funding available for each six-month job placement will cover 100% of the National Minimum Wage for 25 hours a week – and employers will be able to top this wage up.
- A total of £1.6 billion will be invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job. Young people, who are amongst the worst hit by the crisis, will benefit from this.
- The plan will also create tens of thousands of jobs through bringing forward work on £8.8 billion of new infrastructure, decarbonisation and maintenance projects.
- A temporary increase to the Nil Rate Band of Residential SDLT (Stamp Duty) from £125,000 to £500,000 will be introduced until 31 March 2021. This will drive growth and support jobs across the housebuilding and property sectors.
- The rate of VAT applied on most tourism and hospitality-related activities will be cut from 20% to 5%.
- To encourage people to safely return to eating out at restaurants, the Government has introduced a new Eat Out to Help Out discount. The scheme will support over 129,000 businesses in the hospitality industry. Diners can get 50% off meals and non-alcoholic drinks, up to £10 per person, at participating restaurants, bars and cafes when they eat in. The scheme is valid all day every Monday, Tuesday and Wednesday during August. Participating restaurants and establishments will be reimbursed for the discount they pass onto customers. Detailed guidance and registration details for restaurants and establishments will be published on 9 July and restaurants and outlets can register for the scheme from Monday 13 July.
On 8 July, the Chancellor of the Exchequer announced a new £2 billion Kickstart Scheme as part of his Summer Economic Update.
The scheme will create fully subsidised jobs for young people. Individuals aged 16 to 24 who are claiming Universal Credit and at risk of long-term unemployment will be eligible.
Funding will be available for each six-month job placement. It will cover 100% of the National Minimum Wage for 25 hours a week. Employers will be able to top up this wage.
Support with statutory sick pay
Employers with fewer than 250 employees will be refunded by the Government for the cost of providing 14-days’ statutory sick pay for employees who can’t work or need to self-isolate due to COVID-19. The scheme opened to applications on 26 May 2020.
Go to www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19 for more information.
Financial assistance for redundancy payments
Employers that cannot afford to pay their employees’ redundancy pay can apply for financial support.
The Redundancy Payments Service makes statutory redundancy payments directly to employees on their employer’s behalf (subject to approval).
Go to www.gov.uk/government/publications/financial-assistance-for-employers-unable-to-pay-statutory-redundancy-payments/financial-assistance-for-employers-unable-to-pay-statutory-redundancy-payments for more information.
Grant funding and business rates relief
Grants for businesses that pay little or no business rates
The Government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBRR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.
Relief and support for the retail, leisure and hospitality sectors
The following reliefs have been introduced to support smaller businesses in the retail, leisure and hospitality sectors:
- The Business Rates retail discount has been increased to 100% for the 2020/21 tax year, meaning that businesses will be entitled to a business rates ‘holiday’.
- Grants of up to £25,000 to retail, hospitality and leisure businesses operating from smaller premises with a rateable value over £15,000 and below £51,000. Businesses with a rateable value up to £15,000 may be eligible for a grant of up to £10,000.
Go to www.gov.uk/government/news/coronavirus-covid-19-guidance-for-employees-employers-and-businesses for more information.
Discretionary local business grants
The Government have allocated additional funds to local authorities to enable them to provide grants to certain sole traders and SMEs who have not been able to access the COVID-19 government support.
Every local authority has the discretion to use these funds to support local businesses. This means that eligibility criteria may vary depending on which borough your business is based in.
Find out more here.
Sustainable Innovation Fund
UK registered businesses can apply for a share of up to £55 million for new projects focusing on sustainable economic recovery from COVID-19.
Innovate UK, as part of UK Research and Innovation, is investing up to £55 million to fund single and collaborative research and development projects as part of the Sustainable Innovation Fund.
The aim of this competition is to help all sectors of the UK rebuild after the effects of COVID-19.
All projects must be led by a business and include at least one SME. Proposals can either be from a single business or a collaboration.
Your project’s total eligible costs must be between £100,000 and £500,000. Each organisation working alone or in a collaboration can claim a maximum grant of £175,000.
The first round of the competition closes on 29 July 2020.
Find out more here.
Bounce Back Loan Scheme for small businesses
The Chancellor has announced a new Bounce Back Loan scheme to support small businesses and sole traders affected by the coronavirus pandemic.
Key features of the scheme:
- Businesses can borrow between £2,000 and £50,000
- The Government will guarantee 100% of the loan and there won’t be any fees or interest to pay for the first 12 months
- Loan terms of up to 6 years
- The Government has agreed with lenders a flat rate of 2.5% interest
- The scheme will be delivered through a network of accredited lenders
- Businesses will be able to apply online through a short and simple form, with only seven questions.
The scheme opened to applications on 4 May 2020.
Find out more at www.gov.uk/government/news/small-businesses-boosted-by-bounce-back-loans.
Coronavirus Business Interruption Loan Scheme
The Government-backed Coronavirus Business Interruption Loan Scheme has launched to support businesses to access finance.
The Coronavirus Business Interruption Loan Scheme (CBILS) supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance facilities. The scheme provides the lender with a government-backed guarantee, potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’.
- Up to £5m facility: The maximum value of a facility provided under the scheme will be £5m, available on repayment terms of up to six years.
- 80% guarantee: The scheme provides the lender with a government-backed, partial guarantee (80%) against the outstanding facility balance, subject to an overall cap per lender.
- No guarantee fee for SMEs to access the scheme: No fee for smaller businesses. Lenders will pay a fee to access the scheme.
- Interest and fees paid by Government for 12 months: The Government will 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.
- Finance terms: Finance terms are up to six years for term loans and asset finance facilities. For overdrafts and invoice finance facilities, terms will be up to three years.
- Security: Insufficient security is no longer a condition to access the scheme. For all facilities, including those over £250,000, CBILS can now support lending to smaller businesses even where a lender considers there to be sufficient security, making more smaller businesses eligible for finance. No personal guarantees for facilities under £250,000. Personal guarantees may still be required, at a lender’s discretion, for facilities above £250,000.
- The borrower always remains 100% liable for the debt.
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.
For more information about the CBILS, please click here.
How to apply?
The decision on whether to offer finance is taken by each individual lender, not by government. Businesses remain responsible for repaying any borrowing that they take out. In order to access the scheme, businesses should contact their finance provider, not the British Business Bank.
For more information about eligibility criteria, please click here.
Future Fund - Loans for innovative companies
The Department for Business has launched the Future Fund scheme to support innovative companies that are facing financing difficulties due to the coronavirus outbreak.
The Future Fund provides government loans to UK-based companies ranging from £125,000 to £5 million, subject to at least equal match funding from private investors.
These convertible loans may be a suitable option for businesses that rely on equity investment and are unable to access the Coronavirus Business Interruption Loan Scheme.
On 30 June, HM Treasury announced a number of changes to the fund’s eligibility criteria to support more companies to access finance.
Under the changes, UK companies who have participated in highly selective accelerator programmes and were required, as part of that programme, to have parent companies outside of the UK will now be able to apply for investment.
Find out more at www.gov.uk/guidance/future-fund.
Coronavirus Large 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 more than £45 million. Firms with a turnover of more than £250 million can apply for up to £50 million.
Loans backed by a guarantee under CLBILS will be offered at commercial rates of interest.
The Government has confirmed that from 26 May, the maximum loan size available under the scheme will be increased from £50 million to £200 million.
Support for larger firms via the COVID-19 Corporate Financing Facility
The COVID-19 Corporate Financing Facility provides support for larger firms. Under the scheme, the Bank of England will buy short-term debt from larger companies.
This will support companies that have been affected by a short-term funding squeeze, and allow them to finance their short-term liabilities.
It will also support corporate finance markets overall and ease the supply of credit to all firms.
Go to www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19 for more information.
Help with tax
Deferring VAT payments
The Government has confirmed it will defer VAT payments for three months to support businesses. The deferral will apply from 20 March 2020 to 30 June 2020. This is an automatic offer with no applications required.
HMRC has introduced a dedicated COVID-19 helpline to support businesses in financial distress and with outstanding tax liabilities to receive help with their tax affairs.
Contact the helpline on 0800 0159 559.
Support for businesses paying tax
All businesses in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.
Call the HMRC COVID-19 helpline on 0800 0159 559 for more information.
Extension to file accounts
Businesses can apply for an additional three months to file accounts with Companies House to help companies avoid penalties as they deal with the impact of coronavirus.
Go to www.gov.uk/government/news/companies-to-receive-3-month-extension-period-to-file-accounts-during-covid-19 for more information.
Help for landlords and tenants
Measures for landlords and tenants
Residential landlords will be able to claim a three-month mortgage payment holiday if their tenants are experiencing financial difficulties due to coronavirus, meaning that they cannot pay their rent.
Go to www.gov.uk/government/news/complete-ban-on-evictions-and-additional-protection-for-renters for more information.
Ban on evictions for commercial tenants
Commercial tenants who cannot pay their rent because of coronavirus will be protected from eviction. Under the measures, no business will be forced out of their premises if they miss a payment in the next three months.
Keeping your staff and customers safe
Working safely during COVID-19
From 13 May, anyone who cannot work from home is encouraged to return to work.
The UK Government has published guidance to support employers to reopen their businesses and operate workplaces safely.
The new ‘COVID-19 secure’ guidelines are available to UK employers, and cover eight workplace settings that are allowed to be open, from outdoor environments and construction sites to takeaways and factories.
The guidance sets out practical steps for businesses focused on five key points, which should be implemented as soon as possible:
- Work from home, if you can.
- Carry out a COVID-19 risk assessment, in consultation with workers or trade unions. The Health and Safety Executive has published advice about how to complete a risk assessment.
- Maintain social distancing, wherever possible. From 4 July, where it is not possible to stay two metres apart, guidance will allow people to keep a social distance of ‘one metre plus’. This means staying one metre apart, plus mitigations which reduce the risk of transmission.
- Reinforce cleaning processes. The Government has published guidance about cleaning in non-healthcare settings.
The Department of Health and Social Care has published updated guidance on coronavirus testing, including who is eligible for a test, how to get tested and the different types of test available.
Eligibility has been expanded to all workers who have to leave their home in order to work. People can self-refer, or be referred by their employer.
The Government confirmed on 27 May that testing will be rolled out to anyone with symptoms of coronavirus.
Find out more at www.gov.uk/guidance/coronavirus-covid-19-getting-tested.
Support for high streets
The High Streets Task Force has announced new training, expert advice and online resources for high streets in England.
The High Streets Task Force will provide access to cutting-edge tools, training, information and advice for high streets across England as part of the government’s efforts to get shops back in business safely from 15th June.
This support is open to local councils and all organisations involved with high streets and will include free access to online training programmes, webinars, data and intelligence on topics including recovery planning and coordination, public space and place marketing.
Please find further details here: https://bit.ly/NewSupportHighStreets
Advice on trading
Enforced business closures
The Government has published guidance about the businesses and premises that must close. Businesses that do not follow the rules will be subject to prohibition notices, and fixed penalties.
Go to www.gov.uk/government/publications/further-businesses-and-premises-to-close for more information.
Support for exporters
The Department for International Trade (DIT) has published guidance for UK businesses that export or deliver goods and services abroad, and have been impacted by the spread of COVID-19. It covers financial support for businesses trading internationally, as well as support available from the DIT.
Other Government advice and information
The Skills Toolkit
The Government has launched a new online learning platform to help people build their skills during the coronavirus outbreak.
The Skills Toolkit gives people access to free, high-quality digital and numeracy courses to help build up their skills, progress in work and boost their job prospects.
Courses on offer cover a range of levels, from everyday maths and tools for using email and social media more effectively at work, to more advanced training.
All courses are online and flexible, so people can work through them at their own pace.
Find out more at https://theskillstoolkit.campaign.gov.uk/.
Coronavirus Business Support Blog
The Department for Business, Energy and Industrial Strategy has created the Coronavirus Business Support Blog to help businesses get the support they need to help with the impact of coronavirus.
The Government has made available a full range of business support measures during this time. This blog contains additional information and resources, including:
- Case studies from businesses who have or will be accessing government support
- Posts from different people across government and business.
From 15 June, many retailers across the country will be reopening, and the Government is keen to help welcome back shoppers and celebrate the hard work businesses and retail workers are putting in to ensure their workplaces are COVID-19 Secure.
As such, the Department for Business, Energy and Industrial Strategy (BEIS) is encouraging business owners to be part of the #OpenForBusiness campaign.
To support the campaign, please do the following:
- Take a photo of yourself in front of your reopening business, preferably in front of an ‘Open’ sign
- Post the picture on your social media channels
- Use #openforbusiness
- Tag the Department for Business: Instagram: @beisgovuk / Twitter: @beisgovuk / Facebook: @industrialstrategygovuk
BEIS are also looking for short self-shot videos of ‘a day in the life’ of staff in reopening businesses, so we can show the extra measures businesses are taking to keep employees and customers safe. If you or a staff member would be interested in taking part, please contact email@example.com.