With many business owners unsure about the Covid-19 government support that is available to them, Yorkshire based chartered accountancy and business advisory firm, Hentons has compiled a summary of the main schemes currently on offer.
Hentons, which is ranked as one of the top 100 accountancy firms by fee income in the UK by industry bible Accountancy Age, has seen widespread confusion among SMEs and business owners relating to the main schemes that have been introduced this year.
Mark Bain, a partner said: “Bounce back loans and the Coronavirus Job Retention Scheme (CJRS), commonly referred to as the furlough scheme, and the Self-employment Income Support Scheme (SEISS) were all introduced early in the pandemic, along with several other support packages. At the time they were heavily publicised, with widespread awareness of them and how they could benefit businesses.”
From 1st July 2021, employers must pay 10% of their furloughed workers’ usual wage, while the government will continue to pay the other 70%. Then, during August and September, employers will have to pay 20%, as the government's contribution reduces further to 60%. The furlough scheme will close on 30th September 2021.
Mark continued: “The deadline for bounce back loan applications was at the end of March 2021, and although the CJRS and SEISS will continue until 30th September 2021, albeit at a reduced level, there are still a number of other schemes that can benefit businesses. However, there appears to be much less understanding from business owners about these schemes and the benefits they offer.
“We work with clients of all sizes across every sector and in challenging times, it’s vital that they can easily get access to the support that is available and understand how it can benefit them.”
The main support packages that are currently available to businesses and the benefits:
This is a one-off payment of up to £18,000 and doesn’t have to be paid back. The grant is designed to help support businesses in the hospitality, leisure, personal care and accommodation sectors as they reopen as restrictions in England ease. In addition, non-essential retailers can claim grants of up to £6,000. The amount of money paid depends on the business’s rateable value.
Local authorities pay Restart Grants to eligible businesses and in some cases, it’s done automatically, so business owners don’t need to do anything. However, anyone who thinks they are eligible, but hasn’t received a payment, should contact their local authority.
Recovery Loan Scheme (RLS)
There’s no turnover or trading history requirements and personal guarantees are not required for loans of less than £250,000. There’s no interest or fee-free period, so repayments start immediately. Loans are available from £25,000 to £10 million and the government guarantees 80% of the debt. Applications can be for loans, invoice finance, asset finance and overdrafts.
Businesses can also apply even if they have already taken out a CBILS or a Bounce Back loan. The RLS is set to run until 31 December 2021 and is managed by the British Business Bank through accredited lenders.
Help to Grow Scheme
Help to Grow will provide access to management training, technology advice and discounted software to improve productivity. The scheme is 90% government-funded and will launch at the end of June, although businesses can register interest now. It’s split into two parts – management and digital.
The management stream offers business leaders access to a 12 week-programme delivered by leading business schools across the UK, that is designed to be manageable alongside full-time work. The programme will combine a practical curriculum, with 1:1 support from a business mentor, peer-learning sessions and an alumni network. At the end, participants will develop a tailored business growth plan.
The digital stream will offer SMEs free impartial advice on how technology can boost their performance through a new online platform. Eligible businesses will also be able to get discounts of up to 50% on the costs of approved software, worth up to £5,000. Full details on the businesses and software eligible for the voucher will be published this summer.