Tuesday 24th update can be found here Coronavirus Business Support Update # 3 – from BfS. Today – Sole Traders and the Self Employed http://ow.ly/sYCZ50yU5e4
Business for Scotland is one of the Scottish Government’s account managed business organisations and we have been in touch with our Account Manager and with relevant Ministers to request clarity on the business support available.
Support package still a work in progress
Unfortunately, the relief package is still a work in progress. Given the latest set of measures was just announced on Friday evening, this is to be expected and that means that the information we can confirm is limited at the moment. So far, government helplines suggest going to local council websites but those websites are not ready.
The target date for having the information available with applications forms seems to be April 1st. We will keep you informed as things progress and have urged Ministers to offer more detail and a progress report. Note that I have not yet seen a single council website with the relevant details on how to claim Non-Domestic Rates (business rates) relief or the grants. When we see that change, we will add it to our updates.
- Designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
- Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC have yet to build this).
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement but that may be a month away or more. In other words, you have to pay them and then reclaim the 80%. You can only pay 80% or you can contribute the 20% to maintain full wages yourself but you will not be able to claim that back.
We can report that the Scottish Government has introduced extra rates reliefs (discounts) which will be automatically applied to your bill.
It has also introduced a one-off grant of £10,000 for businesses, in receipt of Small Business Bonus or Rural Relief and £25,000 for businesses with larger rates bills. I have asked for clarification and more details on the eligibility criteria. On the UK Government site it states at all businesses are eligible but that that also begs the question; do big supermarkets get it when their sales are doubling? Again, we will clarify when the information becomes available.
Retail, hospitality and leisure businesses with a rateable value between £18,000 and up to and including £51,000 will be able to apply for a one-off grant of £25,000, the building must be occupied though. We suspect this means the premises should have been operational until the Covid-19 impact on the economy and not that you are still open for business now.
Hi Gordon, my wages bill is a quarter of a million per month for furloughed employees , if it takes HMRC til April or May to get their app/website up and running and it is inundated with applications for the 80% it could be June July before payments for some businesses are received which for me could mean paying out wages of two million or more with a business income of zero this is not sustainable
Agreed, you have a big wage bill other smaller companies have the same pressure on cashflow, so everyone is in the same boat just at different cash amounts.
The £10k and £25k grants should be in companies accounts before April wages if people apply early enough – the 80% will take a lot longer.
I am not convinced that the support package is well enough thought through, that it will reach companies in time to pay April wages and that it’s even remotely big enough.
Are MOT Centres essential and to be kept open? We have a nurse in tomorrow for an MOT and she will be unable to get to work with unsociable hours and shifts without vehicle. If I close tomorrow it will be unlikely to reopen? My staff think we may have no option but to close. Your view ASAP
There is not any real clarity on what is and isn’t essential services, that list will be defined over time. On the one hand, such a crisis is unheard off but we are supposed to have plans in place! I would suggest that an MOT centre doing work on key worker behalf will be absolutely classed as essential work – however, there is a grey area when it comes to normal peoples cars – if they are not needing to be done for a month etc. We will try and give you more clarity in our updates as all of these questions get answered.
Superb summary, saved us lots of time. I was about to go digging to see what we had to do and check out the small print.
What about small businesses that work remotely (who do not have offices)?
I have IT company with everyone in it working from home. Will I get the one-off grant of £10,000!
It does seem to be tied to Business rates, so that’s an interesting question – you will still be able to get the 80% wage support for furloughed employees but the grant is uncertain – I will ask.
Yes but they can only claim the 80% wage relief if the employee is not working. Working from home is still working and doesn’t qualify. I know you did cover that in the original detailed summary, but slightly unclear in response to the specific question.
I stated in my comment and in the update itself that employees that employers claim for must be furloughed and that means not working from home but actually on paid leave.