Financial Support for UK Businesses During COVID-19

To say the past 2 years have been challenging for UK small businesses is an understatement. To help business owners keep running their day-to-day operations, the UK government has introduced several coronavirus financial support loans, grants, and reliefs to support businesses during the course of the COVID-19 pandemic.

Here’s an overview of the financial support measures that were introduced and that can help UK businesses with managing cash flow. Some schemes have now closed—we’ve made a note of which ones these are.

Paying Employees

COVID-19 Job Retention Scheme

The COVID-19 Job Retention Scheme came to an end on 30 September 2021. The last date on which you could make a claim for September was 14 October 2021.

HMRC may accept late claims or amendments for claims from 1 November 2020 and beyond if:

• You took reasonable action to try and claim on time
• You have a reasonable excuse for claiming late
• You claimed as soon as your excuse was no longer relevant

When you’re ready to make a late claim or amendment, you’ll need to:

• Make sure you have a reasonable excuse
• Check you have all the details you need for HMRC to process your claim

Call the HMRC helpline to speak to an adviser about making your claim. If your claim is accepted, the adviser will process it over the phone.

Paying Sick Pay

Statutory Sick Pay Rebate Scheme

The Statutory Sick Pay Rebate Scheme will reimburse you for statutory sick pay you made to current or former employees. You can claim for employees who were off work on or before 30 September 2021.

You can make a claim if:

• You’ve already paid your employees’ sick pay
• You’re claiming for an employee who’s entitled to sick pay because of COVID-19
• Your PAYE payroll scheme was created and started on or before 28 February 2020
• You had fewer than 250 employees on 28 February 2020 across your payroll schemes

Your employee doesn’t need to give you a doctor’s fit note, but you can ask them for:

• An isolation note from NHS 111
• A shielding note from for a doctor or health authority

The scheme covers these types of employment contracts:

• Full-time employees
• Part-time employees
• Employees on agency contracts
• Employees on zero-hour contracts
• Fixed-term contracts (until the end date)

You must submit or amend your claim before 31 December 2021.

Paying Tax

VAT Deferral New Payment Scheme

The VAT deferral new payment scheme is closed.

Businesses that deferred VAT payments from 20 March–30 June 2020 could:

• Pay in full by 31 March 2021
• Join the online VAT deferral new payment scheme by 21 June 2021 to spread deferred VAT payments over smaller, interest-free instalments
• Ask HMRC to make arrangements for paying by 30 June 2021

You may be charged a penalty of 5%, or interest, if you didn’t pay in full or make a payment arrangement by 30 June 2021. But you can appeal against a penalty by:

• Showing you have a reasonable excuse
• Asking for a statutory review—this is when your case is reviewed by someone at HMRC who wasn’t involved in it

Business Rates Relief

Retail, Hospitality, and Leisure in England

Retail, hospitality, and leisure businesses in England don’t have to pay business rates for the 2020/21 tax year. Eligible properties include:

• Shops
• Restaurants, cafes, and pubs
• Cinemas and live music venues
• Sports clubs, gyms, and spas
• Hotels, guesthouses, and self-catering accommodation

Your local council should have automatically applied the deduction. Contact them if you think you missed out on this tax relief.

Nurseries in England

Certain nurseries in England also don’t have to pay rates for the 2020/21 tax year. Your business is eligible if it:

• Is on Ofstead’s Early Years Register
• Cares and educates children up to 5 years old

Nurseries run by local authorities aren’t eligible.

Your local council should apply the discount automatically. Contact them if you think you’ve missed out on this relief.

Business Rates Relief in Northern Ireland

These types of business will receive full rates relief in Northern Ireland for the 2021/22 tax year:

• Hospitality
• Tourism
• Leisure
• Retail and retail services (excluding premises with retail floor space of more than 500m² NIA and that exclusively or mainly sell food, drink, and household goods—this includes off-licences)
• Airports (Belfast City Airport, Belfast International Airport, and City of Derry Airport)
• Childcare
• Newspapers
• Manufacturing

Business Rates Relief in Scotland

In Scotland, retail, hospitality, and leisure businesses will receive full rates relief until 31 March 2022. From 1 April 2022, relief will be available at a rate of 50% for the first quarter of the 2022/23 tax year. This will be capped at £27,500 per ratepayer. Properties must be occupied for you to claim this relief.

Listed airports are eligible for full rates relief during the 2020/21 and 2021/22 tax years, as are businesses that provide handling services to scheduled passenger flights at Scottish airports. Loganair will receive 100% rates relief in these tax years as well, but other airlines won’t.

Business Rates Relief in Wales

In Wales, the following properties are currently exempt from rates:

• Agricultural lands and buildings, including fish farms
• Buildings used for training or the welfare of disabled persons
• Buildings registered for public religious worship and church halls

Retail, leisure, and hospitality businesses and charities with a rateable value of £500,000 or less will receive 100% non-domestic rates relief for the 2021/22 tax year.

Eligible hospitality businesses, leisure businesses, and charities with rateable values over £500,000 can also apply for up to 100% relief of their non-domestic rates liability.

Eligible small businesses with premises with a rateable value of up to £6,000 will receive 100% non-domestic rate relief. And small businesses with premises with a rateable value of £6,001–£12,000 will receive relief on a tapered basis from 100% to zero.

Here’s some more information on rates relief in Wales.

Support for Businesses of Any Size

Recovery Loan Scheme

The recovery loan scheme is open to businesses of all sizes and helps them access loans and other kinds of finance for recovering after the pandemic.

Each business has the chance to claim up to £10 million, but participating lenders will decide how much you can borrow. The government guarantees 80% of the finance to the lender, and as the borrower, you’re 100% liable for the debt.

Changes will apply to the recovery loan scheme from 1 January 2022:

• Only small- and medium-sized businesses will be able to apply
• The maximum amount available will reduce to £2 million per business
• The government’s guarantee of finance to the lender will reduce to 70%

Support for Businesses Affected by COVID-19 Restrictions in England

Local Restrictions Support Grants and Closed Lockdown Payment

The Local Restrictions Support Grant scheme and Closed Lockdown Payment closed on 31 March 2021. If you didn’t receive your payment by 30 April 2021, you need to contact your local council.

Additional Restrictions Grant

This grant provides local councils with funding to help businesses that are impacted by restrictions, but may not be covered in the business rates system. Your council can decide which businesses to support and the amount of funding to provide.

Claim the Right Relief for Your Business

Now you know what financial support is available to businesses during the COVID-19 pandemic, you’ll have hopefully found a form of coronavirus financial support that’s suitable for you and your business.

But if there’s anything you’re still not sure of, you can always work with an accountant or tax adviser. They can help you identify business support measures that are relevant to your situation. We hope you continue to do business during the pandemic and beyond.