Support continues… and it’s time to think about growth
One of the themes of the March Budget was encouraging business growth. The Office for Budget Responsibility (OBR) expects the UK’s economy will recover quickly once the remaining Covid-19 restrictions are finally lifted, hence the government’s readiness to extend its support it for people and businesses.
Support for people
The Coronavirus Job Retention Scheme (CJRS) will continue in full until the end of June 2021, after which the percentage amount of a furloughed employee’s salary covered by the government will gradually reduce. Until 30 June, 80% of an employee’s salary will be paid under the scheme, falling to 70% in July and 60% in August and September.
For those who are self-employed, a fourth grant, worth 80% of three months’ average profits, was made available from April, under the Self-Employed Income Support Scheme (SEISS). This grant, covering the period 1 February to 30 April 2021 was open to anyone who first became self-employed in the 2019/20 tax year, if they submitted a tax return by 2 March 2021.
From late July, self-employed people will be able to apply for a fifth grant, covering the period 1 May to 30 September 2021. This will again be worth 80% of three months’ average profits, where turnover has fallen by at least 30%, capped at £7,500. If the fall in turnover is less, the grant will be limited to 30% of profits, capped at £2,850. Like the CJRS, it is widely assumed that the SEISS will end on 30 September.
Support for businesses
The 100% relief for business rates for eligible retail, hospitality and leisure properties in England will remain in place until 30 June, followed by a reduced relief until 31 March 2022. For support in other sectors, a business rates relief fund of £1.5 billion was also announced in March. To decide how this will be distributed, the government will use official data to see to what extent each sector was affected by the pandemic. This fund covers England; the governments in Scotland, Wales and Northern Ireland announced similar measures.
Also featured in the Budget was the extension of the reduced VAT rate of 5% for hospitality, holiday accommodation and attractions, to 30 September 2021. This will be replaced by a new reduced rate of 12.5%, covering the period 1 October 2021 to 31 March 2022.
The ban on commercial evictions will remain in place until 30 June 2021.
Schemes for growth
These include a recovery loan scheme, to help businesses grow and invest. Under the scheme, the government will guarantee 80% of the finance to the lender. Loans and overdrafts are available; businesses trading in the UK are eligible to apply if they can meet certain criteria. This scheme will be open until 31 December 2021.
Two further schemes include:
Help to Grow: Management
- This will give SMES the tools they need to grow their businesses and improve management skills.
Help to Grow: Digital
- This will combine a voucher, covering up to half the costs of approve software (capped at £5,000), with free online advice.
Businesses must have been operating for more than a year, and have between five and 249 employees. If you are interested in any of these schemes, or want support with optimising your business’s finance to encourage growth, contact the team at Figurit today.
Call Figurit, specialist dental accountants (formerly known as Lansdell & Rose) on 020 7376 933 or complete the form below.