9 minute read
Covid-19 Special
from SBT Issue 436
COVID-19 Update for Businesses
Yesterday the Chancellor, Rishi Sunak, set out further measures the Government will be implementing in response to the Coronavirus outbreak, in order to minimise the economic impact of the necessary steps the Country will take in the coming weeks and months. A summary of the key policies follow but please also keep in mind the measures that had already been announced in last week’s budget; particularly the ability for businesses to defer debts due to HMRC for PAYE, VAT and Corporation Tax. In many cases this will be the most effective step many businesses will be able to take to preserve cash flow liquidity. You can follow the button link below to find out more on this scheme.
Tax Helpline to Support Businesses Affected by Covid-19 www.gov.uk/government/news/tax-helpline-to-support-businesses-affected-by-coronavirus-covid-19
Principal measures announced yesterday Loan funding for SME business
The headline policy for SME businesses was to extend the Coronavirus Business Interruption Loan Scheme (CBILS) and underwrite £330 billion in loan guaranties, assisting businesses to access up to £5 million in Governmentbacked loan finance. This scheme will be up and running by the start of next week and aims to provide liquidity to viable businesses which cannot access finance because they have insufficient security to meet lender’s normal requirements. The loans will be interest free for 6 months.
This flagship policy relies on the systems and decision making processes of banks and as we write it is unclear whether the qualifying criteria or the detail and volume of supporting information required will be relaxed to enable the quick decisions that businesses will require. In the previously announced scheme, the Government only guaranteed 80% of the loan value and this meant that an element of risk remained with the banks tasked with delivering the loans. In our experience
this led to delays and inefficient decision making processes. Further details are expected to be announced soon to provide some clarity, so please do not hesitate to contact us if you need assistance or wish to find out more in the coming days.
Business Rates holidays
Expanding the scope of previously announced measures to assist the retail, hospitality and leisure sectors in the Budget last week, all businesses in those sectors will now pay no business rates for 2020/21, irrespective of their rateable value.
Cash Grants
The grant scheme first announced in the budget last week that delivers cash grants to 700,000 of the smallest businesses in the UK who already pay no or little Business Rates due to Small Business Rate Relief (SBRR) has now been extended from £3,000 to £10,000. Those businesses currently eligible for SBRR will now be able to apply for non-repayable cash grants of up to £10,000.
Businesses in the retail, hospitality and leisure sectors with rateable values of up to £51,000 will be able to apply for cash grants of up to £25,000. It is unclear at this time whether these grants are in addition to the £10,000 grants mentioned above or simply a specific enhancement to their scope for those sectors.
It is our understanding that these new measures will be delivered by Local Authorities and you may need to apply for them, so our best advice at this stage is to contact your Local Authority.
Off Payroll Workers
In an announcement to the House of Commons last night, Chief Secretary to the Treasury, Steven Barclay, delayed the implementation of the new offpayroll working changes to 2021 as a response to the spread of Covid-19. It is unclear how Industry will adapt to this postponement given the proximity to the original implementation date and in the coming days this will become clearer. We can guide and advise you as the details are communicated so please do contact us if you need any advice or support.
Measures for individuals
People in financial difficulty due to the impact of Covid-19 will be offered mortgage payment holidays of at least three months. It is also possible to defer self employed Income Tax liabilities and you can follow the link here to find out how https://www.gov. uk/government/news/tax-helplineto-support-businesses-affected-bycoronavirus-covid-19.
It seems this was the first of what is likely to become a string of further announcements in the coming days to support people’s financial security. We await further announcements regarding the measures that are being worked up by Government for people who are self employed and those who rent their properties.
Recovery of SSP
Previously announced but worth keeping in mind is that businesses with up to 250 employees can recover SSP paid to staff for up to two weeks of an absence if the absence is as a result of Coronavirus. Please refer to further information on this here https://www. gov.uk/government/publications/ guidance-to-employers-andbusinesses-about-covid-19/covid-19- support-for-businesses.
How to contact us
One of our core values at Watson Associates is to “Partner” our clients. This means helping you to navigate both the good times and the uncertain times and our resolve is as strong as ever to deliver meaningful and helpful advice through the coming months. Please do contact us at the office or by email to clarify anything you have read or have questions about and we will do our best to help you.
Further reading
The content of this information has been collated from both the statement given by the Chancellor last night – you can read the full statement here https:// www.gov.uk/government/speeches/ chancellor-of-the-exchequer-rishisunak-on-covid19-response and from the recent budget – you can read the summary of measures announced in the budget last week (some of which have already been superseded) here https://assets.publishing.service. gov.uk/government/uploads/system/ uploads/attachment_data/file/872618/ Covid-19_Budget_fact_sheet_ FINAL__1_.pdf
Paul Severn, Director
Sponsored by Watson Associates www.watsons.co.uk
The strain of the COVID-19 pandemic
As an SME business owner, father of two (9 & 12) and son-inlaw to, two ‘older adults’, one of which with ‘underlying health issues’, I am preparing to feel the strain of the COVID-19 pandemic, as much as the next person. News
With the Prime Minister and his cabinet advising against all non essential travel and social gatherings (pubs, restaurants and theatres).
With the UK boarder now on lockdown and public transport working to off peak schedules. With many businesses postponing non essential face to face meetings and encouraging their employees to work at home, wherever possible, we truly are in unprecedented times.
Search: “GOV.UK - COVID-19: guidance for employees, employers and businesses” for official government advise.
Of course there is little we can do, other than respect the advice from Public Health England and the various experts that know more than you & I.
However it’s almost as important in my view, that we look to minimise the economic impact on UK business, as much as possible.
On the day that my sons secondary school has decided to implement home schooling with less than 24 hours notice, I was initially surprised to receive an email that same evening, from ASOS CEO Nick Beighton, advising,
Especially given the hundreds of workers, that all work within an enclosed space, in close proximity of one and other, at their Barnsley distribution centre.
However, as ‘home working’ is not an option for warehousing & fulfilment staff (as with many other industries) other than ‘shut down’, the likes of ASOS have little choice but to take it day by day, hour by hour, on the advice of Public Health England.
Upon reflection of the position of ASOS, I believe where possible, business should look to try and implement the same mentality, considering staff & customers wellbeing first and full-most.
Home working is a great example of ‘getting on with it’ and for those that have had the pleasure (or displeasure) of working with me, will know just how distracting it can be, to work amongst others in the office.
We should take this enforced position to rethink the way we work, to embrace remote working, especially given some of the new technologies out there, that help support it.
With the vast majority of us working from cloud based applications, the ‘office’ has now extended to the Costa, the Starbucks or shared space working, the likes of WeWork or Regis (other coffee shops and shared space providers are available).
The commute from the upstairs bathroom, to the downstairs dining room table, will have significantly less CO2 emissions attached.
When I think of the thousands of miles my national teams used to travel, to attend team meetings, or the hundreds of miles I might travel, to go and meet a customer, we have a genuine opportunity to rethink how we do things.
Dare I say it, think of the environmental impact we can influence also, in our new ‘enforced’ way of working?!
Let’s therefore swap the face to face, with video conference meetings.
Let’s save time, money and the environment in unnecessary travel to and from meetings and let’s get business done.
Let’s embrace these otherwise challenging times and get on with business, as best we can.
In the words of Albert Einstein himself,
Rather than hide behind “things are on hold due to the Corona Virus” as an excuse not to do business, how about use this time as the ideal time to review suppliers and company spend.
Without the day to day office distractions, this could be the ideal time, especially given the future financial strain, that this epidemic will bring.
If you get five minutes today, tomorrow or this week, take it to call your highest performing sales person and ask them this simple question..
Then ask yourself..
If your supplier is performing to the level that you expect, at the right market price, they’ll have nothing to worry about, right?!
There is more than one way in which you can bring profitability to your business, new business should only form part of that.
So let’s roll our Great British sleeves up, mix with a pinch of modern day working and let’s get business done. COVID-19 will test us no doubt, however we cannot allow it to beat us!
David Drake Director of RDS (Sussex based, Logistics & Courier Experts) david@retaildistributionservices.com www.retaildistributionservices.com
