General Overview:

Businesses in Scotland will benefit from both the UK wide measures and the additional measures from Scottish Government. For Perth and Kinross based businesses, this package of support continues to include the following key measures.

  • The Strategic Framework Business Fund for businesses who area required to close by law, or to modify their operations by law, as part of the Scottish Government’s tiering system.
  • 100% rates relief for properties in the retail, hospitality, leisure and airport sectors.
  • 1.6% rates relief for all non-domestic properties across Scotland. effectively freezing the poundage rate next year
  • Various options for furloughed workers to be paid through the Coronavirus Job Retention Scheme.
  • Reclaim SSP for employees who are sick or self-isolating due to the coronavirus
  • SEE ALSO : Other Financial Help for government backed loan schemes and industry specific funds.

Details and links to apply

Financial Help from Government

Provides finance in the form of term loans, revolving credit facilities (overdrafts), invoice finance and asset finance to mid-size and larger UK businesses with a group turnover of more than £45 million.

CLBILS gives the lender a government-backed partial guarantee (80%) against the outstanding balance of the facility. This scheme is open now for applications of up to £200 million.

This scheme has been extended until 31 January 2021.

  • A lender can provide up to 25% of your annual turnover. The maximum amount you can borrow is £200m. 
  • Term loans and revolving credit facilities over £50m will be offered by CLBILS lenders which have secured additional accreditation. 
  • The maximum size for invoice finance and asset finance facilities remains at £50m
  • The scheme provides the lender with a government-backed, partial guarantee (80%) against the outstanding balance of the finance.
  • The borrower remains 100% liable for the debt.
  • Finance terms range from 3 months to 3 years
  • No personal guarantees are permitted for facilities under £250,000.
  • For facilities of £250,000 and over, claims on personal guarantees cannot exceed 20% of losses after all other recoveries have been applied.

Your business must:

  • Be UK based in its business activity
  • Have an annual turnover of more than £45 million
  • Have a borrowing proposal which the lender would consider viable, were it not for the current pandemic, and for which the lender believes the provision of finance will enable the business to trade out of any short-term to medium-term difficulty
  • Self-certify that it has been adversely impacted by Covid-19
  • Not have received a facility under the Bank of England’s Covid Corporate Financing Facility (CCFF), or CBILS or BBLS
  • Businesses from any sector can apply, except the following:
  • Credit institutions (falling within the remit of the Bank Recovery and Resolution Directive), insurers and reinsurers (but not insurance brokers)
  • Building Societies
  • Public-sector bodies
  • State-funded primary and secondary schools

Companies borrowing more than £50 million through CLBILS will be subject to further restrictions on dividend payments, senior pay and share buy-backs during the period of the loan.

Further information on changes introduced, including new provisions on seniority of CLBILS facilities, can be found on the CLBILS FAQs for businesses page via the British Business Bank website.

Find a lender

  • A list of accredited lenders offering less than £50 million can be accessed via the British Business Bank website.
  • A separate list of accredited lenders offering £50 million or more can also be found via the British Business Bank website

If you cannot pay your tax bill on time because of coronavirus, you may be able to delay it without penalty using HMRC’s Time to Pay service.

Who Can Apply?

  • All businesses and self-employed people 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
  • This allows businesses and individuals to pay off their debt by instalments over a period of time.
  • Arrangements are agreed on a case-by-case basis and tailored to individual circumstances and liabilities

You are eligible if your business:

  • Pays tax to the UK Government
  • Has outstanding tax liabilities

Call the HMRC Helpline on 0800 024 1222

Alternatively you can contact HMRC via webchat (Monday to Friday, 8am to 4pm).

Advisers can only talk to you about problems paying your taxes due to Covid-19. This could be:

  • Self-Assessment
  • VAT
  • Employers’ PAYE
  • Corporation Tax

A link to the webchat facility is available via the HMRC section of the UK Government website.

If your business is required to close by law or to significantly change its operations due to COVID-19 restrictions, you may be eligible to apply for grant funding.

Grant funding for eligible businesses will cover the period of any closures or restrictions with the earliest claim date being 2 November 2020. You can still apply even if you are required to close or modify your operations for less than 4 weeks.

If your business can remain open but is suffering negative impact because it is specifically required to modify its operations by law – for example having to close earlier than normal – you can apply for the Business Restrictions grant.

This does not include where a demand for your products or services has been reduced because of the pandemic:

Business Restrictions Grant

  • £1, 400 if your business premises has a rateable value of up to and including £51,000
  • £2,100 if your business premises has a rateable value of £51,001 or above
  • An upper limit of £10,500 in total in any four-week period will apply to any eligible business operating multiple premises.

Applications to the Strategic Framework Business Fund should be made through the main PKC website.

  • Grants will be paid every 4 weeks in arrears as long as restrictions last.
  • Payments will be paid administered by Perth & Kinross Council, and you will not need to re-apply if restrictions are extended beyond four weeks.
  • When restrictions end, any final payment in arrears may be adjusted to reflect the duration of the restrictions to the nearest week.

Eligibility

You can apply if:

  • your business has been directly impacted by restrictions
  • you have a business bank account – this is the account your grant will be paid into if your application is successful
  • your business is registered for non-domestic rates – if you pay rates through a landlord rather than directly to a local authority you can still apply but must provide evidence through a copy of the lease agreement
  • Limited companies (including Scottish Charitable Incorporated Organisations), sole traders, trust and partnerships can apply provided they meet the above criteria.

If your business operates multiple premises you can apply for grants for each premise. All premises should be included in one application which should be sent to and processed by the local authority area in which your business is headquartered. The maximum any one business can receive will be restricted, regardless of the number of premises.

You cannot apply if your business:

  • is not mentioned in the eligibility guidelines
  • has breached wider COVID-19 regulations/requirements prior to local restrictions
  • has connections to tax havens

Read detailed information about eligibility via the Scottish Government website.

If your business is required to close by law or to significantly change its operations due to COVID-19 restrictions, you may be eligible to apply for grant funding.

Grant funding for eligible businesses will cover the period of any closures or restrictions with the earliest claim date being 2 November 2020. You can still apply even if you are required to close or modify your operations for less than 4 weeks.

If your business is required to close by law, apply for the Temporary Closure Grant. More below. If you If your business can remain open but suffering negative impact because it is specifically required to modify its operations by law – for example having to close earlier than normal – please see details for the Business Restrictions grant.

Temporary Closure Grant

  • £2,000 if your business premises has a rateable value of up to and including £51,000
  • £3,000 if your business premises has a rateable value of £51,001 or above
  • An upper limit of £15,000 in total in any four-week period will apply to any eligible business operating multiple premises.

Applications to the Strategic Framework Business Fund should be made through the main PKC website.

  • Grants will be paid every 4 weeks in arrears as long as restrictions last.
  • Payments will be paid administered by Perth & Kinross Council, and you will not need to re-apply if restrictions are extended beyond four weeks.
  • When restrictions end, any final payment in arrears may be adjusted to reflect the duration of the restrictions to the nearest week.

Eligibility

You can apply if:

  • your business has been directly impacted by restrictions
  • you have a business bank account – this is the account your grant will be paid into if your application is successful
  • your business is registered for non-domestic rates – if you pay rates through a landlord rather than directly to a local authority you can still apply but must provide evidence through a copy of the lease agreement
  • Limited companies (including Scottish Charitable Incorporated Organisations), sole traders, trust and partnerships can apply provided they meet the above criteria.

If your business operates multiple premises you can apply for grants for each premise. All premises should be included in one application which should be sent to and processed by the local authority area in which your business is headquartered. The maximum any one business can receive will be restricted, regardless of the number of premises.

You cannot apply if your business:

  • is not mentioned in the eligibility guidelines
  • has breached wider COVID-19 regulations/requirements prior to local restrictions
  • has connections to tax havens

Read detailed information about eligibility via the Scottish Government website.

The government made an announcement on 8 July 2020 allowing VAT registered businesses to apply a temporary 5% reduced rate of VAT to certain supplies relating to:

  • hospitality
  • hotel and holiday accommodation
  • admissions to certain attractions

The temporary reduced rate will apply to supplies that are made between 15 July 2020 and 12 January 2021.

These changes are being brought in as an urgent response to the coronavirus (COVID-19) pandemic to support businesses severely affected by forced closures and social distancing measures.Hospitality

If you supply food and non-alcoholic beverages for consumption on your premises, for example, a restaurant, café or pub, you’re currently required to charge VAT at the standard rate of 20%. However, when you make these supplies between 15 July 2020 and 12 January 2021 you will only need to charge 5%.

You will also be able to charge the reduced rate of VAT on your supplies of hot takeaway food and hot takeaway non-alcoholic drinks.

More information about how these changes apply to your business can be found in Catering, takeaway food (VAT Notice 709/1).

Hotel and holiday accommodation

You will also benefit from the temporary reduced rate if you:

  • supply sleeping accommodation in a hotel or similar establishment
  • make certain supplies of holiday accommodation
  • charge fees for caravan pitches and associated facilities
  • charge fees for tent pitches or camping facilities

More information about how these changes apply to your business can be found in Hotels and holiday accommodation (VAT Notice 709/3).

Admission to certain attractions

If you charge a fee for admission to certain attractions where the supplies are currently standard rated, you will only need to charge the reduced rate of VAT between 15 July 2020 and 12 January 2021.

However, if the fee you charge for admission is currently exempt that will take precedence and your supplies will not qualify for the reduced rate. More information about how these changes apply to your business can be found in VAT: Admission charges to attractions.

The Flat Rate Scheme

If you are a small business and use the use the Flat Rate Scheme to simplify your VAT calculations you should be aware that certain percentages have been reduced in line with the introduction of the temporary reduced rate of VAT. More information can be found in VAT Flat Rate Scheme.

The Tour Operators Margin Scheme

If you are a business that buys in and resells travel, accommodation and certain other services, and you act in your own name, you may operate the Tour Operators Margin Scheme to simplify your calculations.

Further information about how the introduction of the temporary reduced rate of VAT will affect your calculations can be found in Tour Operators Margin Scheme (VAT Notice 709/5).

Accounting for supplies that straddle the temporary reduced rate

In most cases, you will simply account for VAT at 5% for supplies made between 15 July 2020 and 12 January 2021. However, there may be situations where you receive payments or issue invoices before 15 July 2020 for supplies that take place on or after 15 July 2020.

More information about this can be found on Gov.uk >>>

Businesses with supply chains which rely on Trade Credit Insurance and who are experiencing difficulties maintaining cover due to Coronavirus will now get support from the government.

Delivered through a temporary reinsurance agreement with insurers currently operating in the market the government will work with businesses and the industry on the full details of the scheme to ensure firms are supported and risk is appropriately shared between the government and insurers.

Trade Credit Insurance provides cover to hundreds of thousands of business to business transactions, particularly in non-service sectors, such as manufacturing and construction. As of April 2020 there was over £171 billion business activity insured, covering transactions between around 13000 suppliers and 650,000 buyers

It insures suppliers selling goods against the company they are selling to defaulting on payment, giving businesses the confidence to trade with one another but due to Coronavirus and businesses struggling to pay bills, they risk having credit insurance withdrawn, or premiums increasing to unaffordable levels.

To prevent this from happening, the government will temporarily guarantee business-to-business transactions currently supported by Trade Credit Insurance, ensuring the majority of insurance coverage will be maintained across the market. This will support supply chains and help businesses to trade with confidence as they can trust that they will be protected if a customer defaults on payment.

The guarantees will cover trading by domestic firms and exporting firms and the intent is for agreements to be in place with insurers by end of this month.

The guarantee will be temporary and targeted to cover CV-19 economic challenges, and will provisionally last until the end of 2020. It will be followed by a review of the TCI market to ensure it can continue to support businesses in future. Further details will be announced in due course.

The following benefits will happen automatically for all eligible businesses. You do not need to apply.

  • 100% rates relief for properties in the retail, hospitality, leisure and airport sectors.
  • 1.6% rates relief for all non-domestic properties across Scotland, effectively freezing the poundage rate next year.
  • Coronavirus Business Contingency Fund: Phase 1 which provides one-off grants to nightclubs and soft play businesses required to close by law since March 2020.

HMRC has announced that both VAT and Income Tax Self-Assessment payments can be deferred under the following conditions. HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities. See HMRC support for businesses page here >>>

If you deferred VAT between 20 March and 30 June 2020 and still have payments to make, you can:

  • pay the deferred VAT in full on or before 31 March 2021
  • opt in to the VAT deferral new payment scheme when it launches in 2021
  • contact HMRC if you need more help to pay

If you want to opt in to the new payment scheme, instead of paying the full amount by the end of March 2021, you can make up to 11 smaller monthly instalments, interest free. All instalments must be paid by the end of March 2022.

The scheme will allow you to pay your deferred VAT in up to 11 equal monthly instalments without adding interest. To use this scheme you must:

  • have deferred VAT to pay
  • be up to date with your VAT returns
  • be able to pay the deferred VAT by Direct Debit

You cannot opt in yet. The online opt in process will be available in early 2021. You must opt in yourself, your agent cannot do this for you.

Self-employed Income Tax payments due in July 2020 will be deferred to January 2021

You can still pay your deferred July 2020 payment on account any time up to 31 January 2021. You can check payments you need to make towards your next tax bill by singing in to your online account via gov.uk.

Pay in full

  • You can pay your deferred July 2020 payment on account in full any time between now and 31 January 2021 using HMRC’s online service.

Pay in instalments

  • You can pay your tax by instalments if you’re unable to pay in full by 31 January 2021. If you file your 2019 to 2020 Self Assessment return early HMRC will know what payments you owe before the 31 January 2021 payment due date.
  • You’ll then be able to set up a Time to Pay instalment arrangement with HMRC.

As one of the first measures announced by the UK Government to support businesses, the Coronavirus Job Retention Scheme (CJRS) funding for furloughed employees has been accessed for circa 9 million workers.

All employers with a UK, Isle of Man or Channel Island bank account and UK PAYE schemes can claim the grant. You do not need to have previously claimed for an employee before the 30 October 2020 to claim.

HMRC: Changes To The Job Retention Scheme

The Coronavirus Job Retention Scheme has been extended until 31 March 2021 and the government will review the scheme in January 2021.

You can now claim for employees who were employed on 30 October 2020, as long as you have made a PAYE RTI submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

Employers can now furlough employees for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked.

You will need to pay for employer NICs and pension costs. Find out more information on employer contributions to the Coronavirus Job Retention Scheme.

We know that keeping up with the various changes to the Coronavirus Job Retention Scheme, and ensuring that you’re using flexible furloughing to support your business is a job in itself.  The most up to date information can be found on the government website Coronavirus Job Retention Scheme page.

The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the Statutory Sick Pay paid to current or former employees.

The Scheme covers all types of employment contracts including full-time, part-time, employees on agency contracts and employees on flexible or zero hours contracts as well as fixed term contracts until the date their contract ends.

The repayment will cover up to 2 weeks SSP starting from the first qualifying day of sickness, if an employee is unable to work because they:

  • Have coronavirus symptoms
  • Are self-isolating because someone they live with has symptoms
  • Are self-isolating because they’ve been notified by the NHS or public health bodies that they’ve come into contact with someone with coronavirus
  • Have been advised by letter to shield because they’re clinically extremely vulnerable and at very high risk of severe illness from coronavirus.
  • Have been notified by the NHS to self-isolate before surgery for up to 14 days

Employers can make more than one claim per employee, but cannot claim for more than 2 weeks in total. You can claim if you meet the following criteria.

  • You have already paid your employee’s sick pay (use the SPP calculator to work out how much to pay)
  • You’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • You have a PAYE payroll scheme that was created and started on or before 28 February 2020
  • You had fewer than 250 employees on 28 February 2020 across all your PAYE payroll schemes

Employees do not have to give you a doctor’s fit note for you to make a claim. But you can ask them to give you either:

  • An isolation note from NHS-111 if they are self-isolating and cannot work because of coronavirus
  • A ‘shielding note’ or a letter from their doctor or health authority advising them to shield because they’re at high risk of severe illness from coronavirus

You can claim back from both the Coronavirus Job Retention Scheme and the Coronavirus Statutory Sick Pay Rebate Scheme for the same employee but not for the same period of time.

The online service you’ll use to claim back Statutory Sick Pay is now available.

Use the SSP calculator to work out the actual amount you can claim.

The Self-employment Income Support Scheme (SEISS) supports self-employed individuals (including members of partnerships). This scheme allows you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. Claim a grant through the Self-employment Income Support Scheme.

Created to support those who work for themselves who are now experiencing financial difficulty, the scheme’s aims are to bring parity across the lives of all working people during this difficult time.

How the grant works

The scheme has now been extended. If you were not eligible for the first and second grant based on the information in your Self Assessment tax returns, you will not be eligible for the third.

  • To make a claim for the third grant your business must have had a new or continuing impact from coronavirus between 1 November 2020 and 29 January 2021.
  • The third taxable grant is worth 80% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total.

The grant does not need to be repaid but will be subject to Income Tax and self-employed National Insurance.

There will be a fourth grant covering February 2021 to April 2021. HMRC will set out further details, including the level of the fourth grant in due course.

How to claim

Applications for the third grant will open from 30 November 2020. Make your claim from the date HMRC give you either by email, letter or within the online service.

The online service for the third grant is now available (from 30 November 2020.) If you’re eligible, you must make your claim for the third grant on or before 29 January 2021. You will need your:

  • Self Assessment Unique Taxpayer Reference (UTR) – if you do not have this find out how to get your lost UTR via the gov.uk website.
  • National Insurance number – if you do not have this find out how to get your lost National Insurance number via the gov.uk website.
  • Government Gateway user ID and password – if you do not have a user ID, or have lost it, you can create one or find out how to recover your login details when you make your claim
  • UK bank details

Other Benefits for Self Employed

  • If you are sick or if you have been advised to self-isolate. You will be able to claim Employment and Support Allowance (ESA) from day one instead of day eight.  Payments have been raised so that the self-employed receive the same amount as someone on statutory sick pay. This is currently £94.25 a week. You can make a claim for new style Employment and Support Allowance on the Government’s website. You’ll need to fill in a NSESAF1 claim form to apply for “New Style” ESA.
  • Claiming Universal Credit top ‘Top Up’ your income.  The minimum income floor (MIF) applies to those who’ve been self-employed for more than 12 months. The MIF assumes that self-employed people work 35 hours a week and earn the minimum wage. The Department for Work and Pensions (DWP) compares their real earnings with the MIF to work out their Universal Credit award. For full details go to the Self-employment and Universal Credit page on the Gov.uk website.

The Scottish Government have set up a business support helpline (0300 303 0660) for all business support enquiries in Scotland and request that businesses needing guidance contact them in the first instance on this number. Additional advice is available here >

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