SMEs laud Government relief schemes

Chancellor Rishi Sunak has announced an unprecedented package of support to protect jobs and businesses across the UK during the ongoing crisis and provide a wide range of financial support. 

37-year-old Bilal Majeed’s fabric shop, A&M Textiles, in High Wycombe deals with a range of textiles products. On 20^thMarch as soon as the government’s lock-down measures came into force, Bilal had to shut down his business. But when NHS staff needed PPEs and people needed fabric for events such as funerals, Bilal got a few customers but 99% of his sales were lost. 

Bilal said, “We were panicking. We didn’t know how long we would remain closed and how we were going to meet all the expenses and pay the rent and bills. Later that week came the Government for Small Business Grant Relief which was paid to businesses depending on their rateable values. That was a big relief.”

When asked how easy the application process was, he said, “The application was straightforward, and we had the money within two weeks.”

Though Bilal got £25,000 through the Business Grant scheme, he then applied for the Coronavirus Business Interruption Loans Scheme (CBILF), and later applied for a £30,000 Bounce Back Loan. He said, “We had two applications running at the same time. We got an email from the bank saying that they would cancel our CBILS application. Now, the Bounce Back Loan is under process, and we are waiting for the funds to arrive.”

41-year-old Sudharsan Murugavel, the chef and owner of the Dosa Kitchen restaurant in Newcastle upon Tyne told Asian Voice how they have been helped by the government’s business schemes. He said, “What the government is doing is absolutely great. The government has waived all the business rates, which we don’t have to pay for one year. The application was straight forward. The only challenge is that we have to pay the rent. There is a mortgage holiday for residential landlords but not for business landlords. Since the mortgage depends on our rent, we have to pay it. But the government has offered us £25,000 from the Retail, Hospitality and Leisure Grant Fund (RHLGF) and ifthat money comes in, paying the rent will be easier.”

He added, “My VAT was supposed to be paid on 7^thApril. Around 19^thMarch the government sent an email saying that they will defer the VAT payment. I had saved-up cash to pay the VAT. So, the deferral also gave me a buffer to help in our cash flow.”

37-year-old Deepa Sugathan is a solicitor and one of three partners and directors at Silk Route Legal, a small City law firm in London. They have applied for the VAT deferral scheme as well as CBILF. Deepa said, “Applying for the VAT deferral was relatively straightforward, and we have till March 2021 to pay our March 2019 instalment. We have also applied for CBILF. The government requirement and the initial application has been relatively simple. However, the banks have their own requirements and that has been a bit of a challenge and has delayed the process of approval.”

In her mid-50s, Harjeet Mann is the proprietor of One Nine Seven Early Years Nurseries in Kingston-Upon-Thames. She said, “Throughout this unprecedented time, our nursery has remained open for key workers’ children and vulnerable children. As a result of reduced operations, we have had to use the government's Job Retention Scheme, which has helped to avoid lay-offs. We're very proud of our staff for persevering through this difficult time and we hope to welcome back our regular children soon.”

BUSINESS SUPPORT AVAILABLE

The Coronavirus Job Retention Scheme:

• Businesses across the UK can put employees on a period of temporary leave (furlough) and apply for a government grant to cover 80% of those workers’ usual monthly wage costs, up to a cap of £2,500 a month.
• The scheme is now available until the end of October.

Self-Employment Income Support Scheme (SEISS):

• The Self-Employment Income Support Scheme allows eligible self-employed individuals to claim a taxable grant of 80% of their average monthly trading profits, paid out in a single instalment covering 3 months, and capped at £7,500 in total. Around 95% of people who receive the majority of their income through self-employment could be eligible.
• To benefit from SEISS, you need to receive at least half of your income from being self-employed and be earning under £50,000 in profits.
• You can use HMRC’s eligibility checkerto see if you could benefit from the scheme.

Statutory Sick Pay:

• The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the current rate of Statutory Sick Pay (SSP) that they pay to current or former employees for periods of sickness starting on or after 13 March 2020.

VAT deferrals:

• The Government has given the option to defer VAT payments to UK VAT-registered firms, for payments due alongside VAT returns until the end of June. If you’re a UK VAT-registered business and have a VAT payment due between 20 March 2020 and 30 June 2020, you have the option to either defer the payment until a later date or pay the VAT due as normal. 
• HMRC will not charge interest or penalties on any amount deferred. 

Business rates holiday and eviction protection:

• The Government has introduced a business rates holiday for the retail, hospitality and leisure sectors and nurseries, meaning eligible properties in England will pay no business rates this year. This relief is worth almost £10 billion. 
• Commercial tenants who cannot pay their rent because of coronavirus will be protected from eviction.

Grants:

• The Small Business Grant Fund (SBGF) provides businesses with a £10,000 grant per property, for each of their properties which is in receipt of Small Business Rates Relief or Rural Rates Relief. This scheme is only applicable in England.
• The Retail, Hospitality and Leisure Grant Fund (RHLGF) provides businesses with grants of up to £25,000 per property, for each retail, hospitality or leisure property with a rateable value below £51,000. This scheme is only applicable in England.
• Local authorities are contacting eligible businesses directly to arrange grant payments. If a business believes they are eligible and has not yet heard from their local authority, they should get in touch with them to ask about these payments.
• On 1 May, the Government also allocated up to an additional £617 million to local authorities to enable them to make discretionary grants to small businesses in their communities, which have been excluded from the SBGF and RHLGF because of the way they interact with the business rates system. This only applies in England.
• We encourage businesses to look out for their local authority’s version of the Discretionary Grants Fund, and to contact their local authority for more information in due course. This only applies in England.

Loans:

• The Government’s Bounce Back Loans Scheme provides loans of up to £50,000 to small businesses, with an 100% government-backed guarantee for lenders. These loans will be interest free for the first 12 months and businesses can apply online with a short and simple form.
• TheCoronavirus Business Interruption Loan Scheme is available for loans or other forms of finance of up to £5m.
• The Government will pay interest and any fees for the first 12 months and will provide the lender with an 80% guarantee to support the lending. This scheme is available UK-wide.
• The Coronavirus Large Business Interruption Loan Scheme (CLBILS) supports large businesses with an annual turnover of over £45 million per year to apply for up to £25 million of finance.

Future Fund:

• The Future Fund will issue convertible loans between £125,000 to £5 million to innovative companies which are facing financing difficulties due to the coronavirus outbreak.
• If your business needs to hire now, government can also help you fill your vacancies by connecting with skilled and experienced people.