MONEY MATTERS
The Budget: What it means for SMEs and what to do next
O
n Wednesday, 3rd March, Chancellor Rishi Sunak
and leisure properties in England will pay no business
announced the Government’s latest Budget,
rates for three months from 1 April when combined with
perhaps the most significant
for businesses in recent times due to the events of the last 12 months. We’re breaking down the key policies affecting British small and medium enterprise (SME) businesses, how they trade, pay tax and the effect on jobs. In addition, we highlight how businesses can start to re-launch their recovery and invest, build and grow their businesses as a result of the measures featured in the budget and the recent road to recovery.
Job Retention (Furlough) Scheme The Coronavirus Job Retention Scheme has been extended until 30 September 2021. Employers can continue to claim 80% of wages up to £2,500 per month up until the end of June, reducing to 70% in July and 60% in August and September as employers will be expected to pay 10% towards the hours their staff do not work in July, increasing to 20% in August and September, as the economy reopens.
Restart Grants One off cash grants of up to £18,000 for hospitality, accommodation, leisure, personal care and gym businesses in England.
Small Business Rates Relief, with further relief available for the rest of the year.
VAT Reduction The temporary 5% reduced rate of VAT has been extended until 30 September 2021, supporting tourism and hospitality sectors. After this period, the rate will increase to 12.5% for a further six months until 31st March 2022, before returning to 20%.
Corporation Tax The rate of Corporation Tax will increase to 25%, but will not take effect until 2023, for businesses with profits of more than £50,000. For those companies below this figure, the figure will remain at 19%. Now that we know what the immediate future is for jobs, tax, grants and loans, with a speculative road map for the re-opening of gyms, restaurants, bars and retail, among other businesses and sectors, we are looking to support those businesses that want to re-launch and secure funding to improve their cash flow, and get their businesses back where they should be.
Secure funding With the government offering grants and the Recovery Loan Scheme to support businesses in their re-launch, it
Recovery Loan Scheme
is important that business owners make the most of this
A new loan scheme to support access to finance for UK
opportunity to secure funding that could be key to helping
business as they grow and recover from the disruption
them get under way again. The CBIL Scheme is ending on
of the COVID-19 pandemic. Similar to the CBIL Scheme
30th March, giving businesses 4 weeks to submit their final
Johnson Reed has been providing to businesses since
applications to secure funding under the current criteria.
March last year, it will be accessible to limited companies
Whatever business you own, you need to be sure that you
affected by COVID-19, offering term loans, asset finance
are covered for the next 6, 12, 18 months and beyond,
and invoice finance. The scheme launches on 6 April and
as the last 12 months have taught us that anything can
is open until 31 December, subject to review, and we will
happen in business, and whilst these options are available
continue to keep our customers and suppliers updated.
it is essential that you guarantee your business can sustain
However, before April, the CBIL Scheme is ending on 30th
and grow for years to come.
March, this is the last opportunity to secure funding with 12 months of no repayments and applications are still being accepted.
Invest in equipment and assets Sectors such as leisure and hospitality are likely to boom when life returns to normal. People want to go to the gym
Business Rates Holiday
again, eat out, have a drink and enjoy their spare time,
The business rates holiday in England has been extended
and it’s going to be a competitive market. This is why
by an additional three months, meaning retail, hospitality
we’re encouraging British businesses to get a head start
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Fastfood Professional • April and May 2021
April and May 2021 • Fastfood Professional
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