News

CORONAVIRUS: Bounce Back Loan Update

Applications for the loan have now opened and further details of the scheme have been issued by the British Business Bank. These include:

• the claimant must be a UK limited company or partnership or tax resident in the UK
• the amount of the loan is limited to 25% of a business’ turnover
• interest rate is at 2.5% pa, with the government covering the first 12 months
• there are no fees on early repayment
• no security can be required in the form of personal guarantees or over a borrower’s personal assets
• the claimant (and any member of any group of which it is a part) must derive more than 50% of its income from trading activity
• a group may only make one claim and may not also claim for Coronavirus Business Interruption Loan Scheme, the Coronavirus Large Business Interruption Loan Scheme, or the Covid Corporate Financing Facility, unless that loan will be refinanced in full by the Bounce Back Loan Scheme facility

The details on the scheme and the banks through which applications should be made can be found at:
https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/

Further details can also be found at: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/faqs-for-small-businesses/

Small Business Grant Fund and Hospitality and Leisure Grant Fund - UPDATE

Further guidance on the scheme has been issued which includes noting that the grants received will be subject to tax. The guidance can be found at:
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/882809/small-business-grant-and-retail-leisure-hospitality-grant-guidance-for-businesses.pdf

Self-Employment Income Support Scheme - UPDATE
Further guidance has been issued on what qualifies as “adversely affected by coronavirus”. This includes:

• those unable to work due to coronavirus (due, for example, to self-isolating, being sick or having caring responsibilities)
• if the business has had to stop or scale down due to

o interruption to the supply chain
o fewer or no customers
o staff being unable to come to work

In addition, it has been noted that the grant
• can be claimed on all categories of work visa
• must be made by the individual and cannot be made by an agent

The claim will require:
• the Self Assessment Unique Taxpayer Reference (UTR) and National Insurance number
• the Government Gateway user ID and password
• the bank account number and sort code for the account to receive the BACS payment.

The approval of the grant should be notified straight away and paid within 6 working days.

The claimant will need to retain:
• the amount claimed
• the claim reference
• evidence that the business was adversely affected by coronavirus

The grant will need to be reported on
• the Self Assessment tax return
• the Universal Credit claim as self-employed income
• tax credits claims as self-employed income. It should also be reported that the claimant is working more than 16 hours a week.

The full guidance (including links to obtaining the UTR and NI number) can be found at: 
https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

There is also additional guidance on eligibility which notes that:
• members of a partnership will each need to make their own claim based on their individual circumstances (including their share of the partnership profits)
• where the partnership rules require the grant to be paid into the partnership, the grant should be paid on to the claimant
• those not resident in the UK or resident in the UK and taxed on a remittance basis may be eligible

This guidance can be found at: https://www.gov.uk/guidance/how-different-circumstances-affect-the-self-employment-income-support-scheme

Additional examples have been added to the guidance on calculating the amount that can be claimed. This can be found at: https://www.gov.uk/guidance/how-hmrc-works-out-total-income-and-trading-profits-for-the-self-employment-income-support-scheme#history

Thursday, 7th May, 2020