COVID-19 - Government Funding · 2020. 12. 4. · ©2020 Deloitte LLP 2 This document summarises the UK Government’s funding response to COVID- 19 to date. We aim to update this

COVID-19 - Government Funding Summary of announced schemes in the UKUpdated: 04 December 2020

©2020 Deloitte LLP 2

This document summarises the UK Government’s funding response to COVID-19 to date. We aim to update this as soon as new announcements are made, with changes shown in red.

This publication has been written in general terms and may not include all relevant information. We recommend that you obtain professional advice before acting or refraining from action on any of the content of this publication. In particular there are a number of areas where we are expecting further clarification in relation to the process of defining and agreeing the relevant scheme’s details, specifications and eligibility and therefore information is subject to change.

Introduction


Summary of updates to existing funding initiatives and new measures announced between 25 November to 02 December 2020 (all updates shown in red)

Funding updates

01 December

A new £1,000 Christmas grant announced by the Prime Minister for 'wet-led pubs‘• An additional £1,000 Christmas grant has been announced for ‘wet-led pubs’ in tiers 2 and 3 that

will see their operations reduced as a result of the latest regional measures.• The payment will be a one-off grant for December and will be paid on top of the existing £3,000

monthly cash grants for businesses.

30 November

A new £340m package of support announced in Wales for hospitality, tourism and related supply chain sectors• On the 30 November the First Minister announced targeted support for the hospitality, tourism and

related supply chain sectors: • The £160m ERF Restrictions Business Fund will provide operating costs support for short term

impact for up to 60,000 businesses that are materially impacted as a result of national restrictions. Linked to the non-domestic rates system.

• £180m ERF Sector Specific Support (operating cost) is targeted at Hospitality, Tourism and Leisure (HTL) businesses or supply chain companies who are materially impacted with a greater than 60% impact of turnover as a result of the restrictions.

General updates

02 December

Regulatory approval for first coronavirus vaccine • The UK has become the first country in the world to approve the Pfizer/BioNTech coronavirus

vaccine, paving the way for mass vaccination.

England enters a tougher version of its three tier system of restrictions• From the 02 December, parts of England will be placed into one of three tiers: Tier 1 (Medium risk),

Tier 2 (High Risk), Tier 3 (Very High Risk). • About 99% of England has been placed into the high and very high coronavirus risk category - Tiers

2 and 3 – with the first fortnightly review on 16 December.

30 November

New restrictions for the hospitality sector announced in Wales• In Wales, First Minister Mark Drakeford announced a series of new riles banning pubs, cafes and

restaurants selling alcohol and forcing them to close at 6pm.• The rule comes into force on Friday 04 December at 6pm and will be reviewed on 17 December. • A new funding package of £340m was announced in response to these new restrictions to support

businesses in the hospitality, tourism and related supply chain sectors.

25 NovemberReinstatement of a key insolvency protection for company directors• Key insolvency protection for company directors has been reinstated so that the suspension of

liability for so-called ‘wrongful trading’ will run until 30 April, 2021. Click here to access The Corporate Insolvency and Governance Act 2020.

As a new tiering system replaces the national lockdown in England, new, tighter restrictions for the hospitality sector will come into effect in Wales from 04 December. In Scotland, people are operating under a five tier structure, with the highest restrictions, level four, being lifted on 11 December, whilst Northern Ireland is in the midst of a two week period of additional restrictions. In response, further funding and support has been announced for businesses impacted most by new restrictions in England and Wales. Details of these are included below. Meanwhile, regulatory approval of the Pfizer/BioNTech coronavirus vaccine is very welcome news, with a phased roll-out programme due to start next week.

https://businesswales.gov.wales/coronavirus-advice/erf-restrictions-business-fundhttps://businesswales.gov.wales/coronavirus-advice/erf-sector-specific-supporthttps://www.bbc.co.uk/news/health-55145696https://www.bbc.co.uk/news/explainers-52530518https://www.bbc.co.uk/news/uk-wales-55144740https://www.iod.com/news-campaigns/news/articles/IoD-policy-win-insolvency-protection-reinstatementhttps://www.legislation.gov.uk/uksi/2020/1349/regulation/2/made


Government Funding – Summary of announced schemes in the UKIndex page

PeopleBusiness loans and

grantsIndustry focussed

and other initiativesTax support

Coronavirus Job Retention Scheme (CJRS) ExtensionCoronavirus Job retention Scheme (CJRS)Job Support Scheme for open businesses (JSS Open)Job Support Scheme for businesses legally required to close (JSS Closed)

Self-employed Income Support Scheme (SEISS)

Defined Contribution pension reductions

Statutory Sick Pay “SSP” for small and medium sized businesses

Kickstart job placements for young people

Local Restrictions Support Grant (LRSG) for England (Tier 2)

Wet-led pub grants for tier 2 and 3 areas in England

Economic Resilience Fund Business Development Grants (ERF Phase 3)

Economic Resilience Fund in Wales – Restrictions Business Fund

Economic Resilience Fund in Wales – Sector Specific Fund

Local Restrictions Support Grant for England

Small business grant aid in England

Covid Corporate Financing Facility (CCFF)

Coronavirus Large Business Interruption Loan Scheme (CLBILS)

Coronavirus Business Interruption Loan Scheme (CBILS)

Bounce Back Loan Scheme

UK Aid direct programme, including Small Charities Challenge Fund

Future Fund

Grants and loans for R&D focussed SMES

Welsh Economic Resilience Funds

COVID Small Business grant scheme – Northern Ireland

Grant funding for ideas that address COVID-19

Temporary reduced VAT rate on supplies of catering, accommodation and attractions.

Deferral of VAT

Income Tax payment deferral

Time to Pay arrangements “TTP”

Film and TV Production Restart Scheme

Cultural, Arts and Heritage Institutions Grant

Care Home Support package

Rates relief

£6.1 million funding boost to help high street and town centres through pandemic

Hospitality, tourism and retail sectors grant – Northern Ireland

Support for Scottish seafood industry

Coronavirus funding for frontline charities

Government to support businesses through Trade Credit Insurance guarantee

Insolvency legislation

Ban on evictions for commercial tenants who miss rent payments

Please click on title blocks to take you to the relevant section

Visit GOV.UK to find coronavirus financial support

for your business

https://www.gov.uk/business-coronavirus-support-finder


Government Funding – Summary of scheme distributions in the UKScheme 15 July 22 July 29 July 05 Aug 12 Aug 19 Aug 26 Aug 02 Sep 09 Sep 16 Sep 14 Oct 18 Nov

CCFF (value outstanding) £18,498mn £18,718mn £17,393mn £17,393mn £17,550mn £17,533mn £17,532m £17,443m £17,678mn £16,991mn 15,849mn 15,360mn

Scheme 7 April 7 May 7 June

VAT payment deferral scheme337,000 payments eligible for deferral 145,000 payments deferred by businesses£5.1bn amount of Vat deferred during period£5.1bn Total/cumulative amount of VAT deferred

532,000 payments eligible for deferral 251,000 payments deferred by businesses£17.3bn amount of Vat deferred during period£22.4bn Total/cumulative amount of VAT deferred

337,000 payments eligible for deferral 113,000 payments deferred by businesses£5.2bn amount of Vat deferred during period£27.5bn Total/cumulative amount of VAT deferred

Scheme 19 July 26 July 02 Aug 09 Aug 16 Aug 20 Sep 18 Oct 15 Nov

CLBILS£2.89bn approved428 approved applications831 applications

£3.10bn approved457 approved applications872 applications





£4.57bn approved623 approved applications1,034 applications

£4.84bn approved658 approved applications1,065 applications

CBILS£12.20bn approved55,674 approved applications112,212 applications

£12.65bn approved57,234 approved applications115,941 applications







Bounce Back Loan Schemes (BBLS)

£32.79bn approved1,047,611 approvedapplications1,084,153 applications







£42.18bn* approved1,397,475 approvedapplications1,766,768 applications

CoronavirusJob Retention Scheme

9.5m furloughed1.2m employers using scheme£29.8bn cumulative value of claims








SEISS

2.7m claims made£7.8bn cumulative value of claims

1st tranche closed 13 July. No further updates until 2ndtranche data available

N/A N/A 2nd tranche opened om 17 Aug:• 296,850 claims

made by midnight with a total value of £768.9m

2.2m claims made with a total value of £5.6bn



Scheme 12 July 19 July 26 July 02 Aug 09 Aug 16 Aug 20 Sep 18 Oct 18 Nov

Future Fund 750 total number of applications429 loans approved with value £419.6m

781 total number of applications465 loans approved with value £468.7m





1,072 total number of applications711 loans approved with value £720m

1,243 total number of applications745 loans approved with value £770.8m

1,325 total number of applications874 loans approved with value £875.8m

*The value of BBLS facilities approved includes the extra value from a BBLS loan which has subsequently been ‘topped-up’ to a higher amount.

©2020 Deloitte LLP - Private and Confidential61. Scheme open for applications until this date (extension announced on 2 November 2020).

NB The temporary moratorium suspending landlords' rights to forfeit business leases for non-payment of rent is to be extended to 31 December 2020

July August September October November December January 2021 February 2021 Mar 2021 April 2021 May 2021

Job Support Scheme

CJRS

CJRS Job Retention Bonus

Pension Contributions

Trade Credit Insurance

Rates Relief

VAT reduction

Deferred VAT

CBILS (until 31/01/211)

CLBILS (until 31/01/211)

CCFF (until 17/2/211)

TTP arrangements

From 1 July, employers pay all employment costs (incl, employer NIC and pension contributions) of hours worked by flexibly furloughed staff

From 1 August, employers to pay all employer NIC and pension contributions on both furlough pay and hours worked

Employer pays 10% of regular wages of furloughed hours

Employer pays 20% of regular wages of furloughed hours

Gov’t funds 80% of pay capped at £2,500pm. For part-time furloughed workers, grant is pro-rated.

60% up to £1,875pm, pro-rated for hrs wkd

70% up to £2,190pm, pro-rated for hrs wkd

80% up to £2,500pm, pro-rated for hrs wkd. Further extension announced on 5 November, extending the scheme to the end of January.

Further extension announced on 5 November, extending the scheme to the end of March. Funding levels TBC

Unwind any reduced DC scheme contributions of furloughed staff when their furlough ends

Government cover expires 31 December 2020

100% rates relief for retail, leisure and hospitality businesses expires 31 March 2021. Local Restrictions Support Grants for businesses legally required to close (up to £3,000 per month) and those in the hospitality, accommodation and leisure sector in Tier 2 areas to run to April 2021.

Deferred VAT payments can be repaid in 11 smaller interest fee repayments to January 2022

Interest free period expires after 12 months. TL and asset-backed max 10 years, RCF 3 yrs

£50m+ loans have restrictions on dividends, senior pay and share buy-backs. Max loan period 3 years

Restrictions on dividends, capital distributions and senior pay for loans expiring after 19 May 2021

Initial deferral from March and April for most companies was until 30 June 2020. They now need to renegotiate with HMRC, if they have not already. While deferrals up to 12 months are theoretically possible, HMRC is negotiating hard for early payment (1-2 months).

A bonus of £1,000 paid to employers for each previously furloughed employee brought back to work and continuously employed to 31 January 2021.The Job Retention Bonus will no longer be paid in February due to the extension of the CJRS.

From 15 July 2020 to 31 March 2021, reduced VAT rate of 5% for certain supplies of catering, accommodation and entry to attractions

JSS Open: Employee must work at least 20% of normal hours and will receive 73% of their pay (subject to a £3,125 pm salary cap), with employer paying 5% and government paying 61.67% towards hours unworked. JSS Closed: Government will cover two-thirds of the salary of employees where employer is legally required to close business premises (up to £2,100 per month) under Health Protection Regulations.

Impact of these changes should be included in forecasts and cash flowsGovernment Funding: Expiry/changes of key company support schemes updated 05 November2020


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial supportFunding category Details Eligibility How to apply Website Additional comments Next Steps

Coronavirus Job Retention Scheme (CJRS) Extension

An extension to CJRS was announced on 31 October 2020. This will apply from 1 November 2020 and will run until 31 March 2021. The following government funding levels are confirmed until 31 January 2021 and will then be reviewed.

Payroll support for all firms and enterprises in the UK• Grant support to cover up to 80% of reference salary for

hours not worked.• The maximum grant is £2,500.• Employer to pay all Employer NICs and minimum pension

contributions and Apprenticeship Levy (if applicable).• Employees can work part-time. The employer must pay

employees’ wages while they are working. The Government’s grant will be pro-rated so it will only fund furloughed hours, i.e. usual hours not worked.

• Employees must have been on employer’s payroll with an RTI submission made to HMRC on or before 30 October.

• Any grant received must be paid to employees in full. Employers can chose to top up wages for unworked hours in addition to the government grant if they wish.

• Employees must be placed on a full-time or part-time furlough agreement and employees must agree to the change in terms and conditions.

• Where consistent with employment law, any flexible furlough or furlough agreement made retrospectively that has effect from 1 November 2020 can be valid for the purposes of a CJRS claim, provided that it is put in place by 13 November 2020 at the latest.

• All employers with a UK bank account and UK PAYE schemes can claim the grant.

• Neither the employer nor the employee needs to have previously used the CJRS.

• Public sector employers and non-public sector employers who are primarily funded from public funds are not expected to participate.

• Eligible employees must have been included on an RTI payroll submission made on or before 30 October.

• Applies to full, part-time, flexible or zero-hour and agency contracts.

• Applies to UK businesses of all size and all employees on the UK PAYE scheme, including foreign nationals.

• Employees who were employed and on the payroll on 23 September 2020 and were subsequently made redundant or stopped working for their employer can be re-employed and claimed for. Similar rules apply for employees on fixed term contracts.

• Calculation of the grant is based on “regular wages” and ‘usual hours’, which are determined by detailed rules based on the pay & hours worked in a specific reference period.

• Detailed rules apply for those on unpaid and statutory leave.

Employers must calculate the amount due and claim via an HMRC portal.

Individual claims needed for each PAYE scheme.

Claims need to include information about any ‘hours worked’ by furloughed employees and their ‘usual hours’ of work, determined by reference to specific rules.

Claims can be made after payrolls are run or up to 14 days in advance.

Employers will be able to submit the first claims for CJRS Extended from 8am on Wednesday 11 November 2020.

Claims relating to November 2020 must be made by 14 December 2020. Claims relating to each subsequent month should be submitted by day 14 of the following month.

HMRC may audit claims after the scheme concludes and requires records to be kept for a minimum of 6years.

The closing date for claims up to and including 31 October remains 30 November 2020.

Announcement on extension of the CJRS

Factsheet released on 5 Novemberhttps://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/932977/ECONOMIC_SUPPORT_FACTSHEET_5_November.pdf

Policy Paper

• HMRC are planning to publish the details of employers who make claims under CJRS Extended, starting in December (in respect of claims from 1 November 2020).

• Putting employees on or off furlough, bringing them back part-time or transitioning to a JSS working arrangement after the end of the extended CJRS requires changes to employment contracts. Existing employment law requirements have not changed and employers need to consider contractual terms and statutory obligations.

• Good records need to be kept to validate any grants claimed and positions taken.

• Payments made to employees will remain subject to tax and social security in the same way as normal pay.

• Detailed rules are expected to closely follow the CJRS.

• However, some changes to CJRS rules are expected, e.g. to the definitions of ‘usual hours’ and ‘reference salary’ to allow for employees who started employment since 19 March 2020 and would thus not have been eligible for the CJRS before now.

Employers wishing to use the extended CJRS are advised to put in place the relevant employee agreements and monitor further government announcements.

Employers wishing to claim for periods from 1 November need to have agreements in place by 13 November.

Detailed guidance is expected on 10 November 2020.

https://www.gov.uk/government/news/furlough-scheme-extended-and-further-economic-support-announcedhttps://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/932977/ECONOMIC_SUPPORT_FACTSHEET_5_November.pdfhttps://www.gov.uk/government/publications/extension-to-the-coronavirus-job-retention-scheme/extension-of-the-coronavirus-job-retention-scheme#employees-furloughed-under-the-cjrs-extension



Coronavirus Job Retention Scheme (CJRS)

Payroll support for all firms and enterprises in the UKo March – June: • Grant support to cover up to 80% of reference salary plus

associated costs of anyone not working due to Coronavirus but whose job has been retained.

• The maximum grant is £2,500 plus employer National Insurance plus the minimum auto-enrolment pension contribution.

• Employees can be deemed “furloughed” from 1 March 2020 and must be “furloughed” for at least 3 continuous weeks.

• Furloughing requires employee-employer agreement and employee must not do any work during furlough.

• No limit on the total level of funding available.• Grant portal is open and payments being received within 4-

6 working days where initial HMRC review raises no questions on the claim.

o July - From 1 July, only employees who completed a furlough period of at least 3 weeks by 30 June will qualify for a grant.

o Employers will be allowed to bring previously furloughed employees back part-time. Employer will pay employees’ wages while they are in work. Government grant will be pro-rated so it will only fund furloughed hours, i.e. usual hours not worked.

o August – Government continues to fund 80% of employee’s regular wages for furloughed hours and employer to pay all Employer NICs and minimum pension contributions;

o September – Government continues to fund 70% of employee’s regular wages for furloughed hours (up to a maximum of £2,190) and employer to pay 10% of employee’s regular wages for furloughed hours, plus all Employer NICs and minimum pension contributions;

o October – Government to continue to fund 60% of employee’s regular wages for furloughed hours and employer to pay 20% of employee’s regular wages for furloughed hours (up to a maximum of £1,875), plus all Employer NICs and minimum pension contributions;

• Covers any employer, business, charity or non for profit organisation in the UK who had a PAYE scheme set up by 19 March 2020.

• Public sector employers and non-public sector employers who are primarily funded from public funds are not expected to participate.

• Eligible employees must have been paid earnings during the 2019/20 tax year with an RTI payroll submission made on or before 19 March.

• Applies to full, part-time, flexible or zero-hour and agency contracts.

• Applies to UK businesses of all size and those on the UK PAYE scheme, including foreign nationals.

• Cover is intended for employees who are “furloughed” instead of being made redundant.

• Furloughed workers must not undertake any work for their employer but are not precluded from volunteering, undertaking training or paid work from other jobs they may have. From 1 July, this will be amended as employers are allowed to bring furloughed employees back part-time.

• Calculation of the grant is based on “regular wages”, and (from 1 July) ‘usual hours’, which are determined by detailed rules based on the pay & hours worked in a specific reference period.

• Detailed rules apply for those on unpaid and statutory leave.

• From 1 July 2020, the number of employees on any claim cannot exceed the maximum number on any previous claim.

Employers must calculate the amount due and claim via an HMRC portal.

Individual claims needed for each PAYE scheme.

For claim periods from 1 July claims need to include information about any ‘hours worked’ by furloughed employees and their ‘usual hours’ of work, determined by reference to specific rules.

From 1 July, claim periods must be at least a week and claim periods cannot straddle a calendar month end.

Claims can be made after payrolls are run or up to 14 days in advance. However, from 1 July, ‘hours worked’ should be known at time of making the claim.

Claims for periods up to 30 June must be submitted by 31 July 2020.

HMRC may audit claims after the scheme concludes and requires records to be kept for a minimum of 5 years.

The closing date for claims up to and including 31 October is 30 November 2020

Guidance is available for employers and employees:

For employers:

https://www.gov.uk/government/collections/coronavirus-job-retention-scheme

For employees:https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme

• Putting employees on or off furlough, bringing them back part-time or transitioning to a JSS working arrangement requires changes to employment contracts. Existing employment law requirements have not changed and employers need to consider contractual terms and statutory obligations.

• Good records need to be kept to validate any grants claimed and positions taken.

• Employees TUPE transferred to a new employer or those covered by “succession to a business” PAYE rules can be furloughed with grants claimed, so long as those employees were on the transferring PAYE scheme on 28 February 2020.

• Restriction on “salary sacrifice” from grant-funded salary during periods of furlough.

• Payments made to employees will remain subject to tax and social security in the same way as normal pay.

• Grants will be taxable for corporation tax or business income tax, but not for private employers (e.g. those employing nannies)

• Uncorrected overclaims will lead to a 100% Income Tax charge.

• Failure to notify HMRC of uncorrected over-claims can lead to an additional 100% penalty and interest.

• Failure to notify HMRC where an officer knew about an uncorrected overpayment can lead to a personal liability for the officer.

The closing date for claims up to and including 31 October is 30 November 2020Employers who have made claims should be documenting the basis on which claims have been made and reviewing that this is in line with the most recent, detailed guidance available.Employers should review claims made and submit any corrections to HMRC. Where possible, corrections should be made by 20 October or within 90 days of the claim, whichever is the later.

Where employers may have over-claimed and are unable to quantify the amounts, they should notify HMRC by 20 October or within 90 days of the claim, whichever is the later.

Employers considering the future working arrangements for previously furloughed employees need to carefully consider the employment law, CJRS and cost implications.

https://www.gov.uk/government/collections/coronavirus-job-retention-schemehttps://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial supportFunding category Details Eligibility How to apply Website Additional comments Next StepsJob Support Scheme for open businesses (JSS Open)

• The JSS is designed to protect ‘viable’ jobs during the winter period.

• The scheme has now been deferred and may be implemented after a phasing out of CJRS Extended. This is currently expected to be at the end of March 2021.

• The JSS is due to run for 6 months and is not sector-specific. During the JSS employers will be able to recover part of the costs of pay for time not worked by employees.

• The JSS comes in two parts – JSS Open is for businesses who can be open and operate and JSS Closed is for businesses who are legally required to close.

• For JSS Open, eligible employees will be required to agree to give up 33.33% of their normal pay for unworked periods. Their pay for the unworked period will be funded 5% by their employer and 61.67% by government grant (subject to a cap of £1,541.75 per month and a maximum salary of £3,125 per month).

• Employers will pay for worked time at the employee’s usual contractual rate.

• The government grant will not cover the cost of employer National Insurance or pension contributions.

• Grants will be paid in arrears and can be paid in addition to claims made under the Job Retention Bonus scheme (now also deferred).

.

• Claims may only be made for employees who are doing paid work for no less than 20% of their usual hours.

• This 20% worked hours condition may be reviewed by government after the first 3 months.

• Employees must have been on the payroll with and covered by an RTI return on or before 23 September 2020.

• Employees must not be served with a redundancy notice nor made redundant during any period for which a claim is made for the employee.

• Employers must agree with their employees and confirm in writing the new JSS working arrangements.

• There is no requirement for prior participation in the CJRS by the employer or in relation to an employee being claimed for.

• Large employers (>=250 employees across an employer’s payrolls) will be required to pass a financial assessment test to demonstrate an impact on turnover in 2020 compared to 2019. For VAT registered employers, this will be on the basis of VAT returns. There will be no test for small and medium sized employers.

• Large employers claiming under the JSS will be expected not to make capital distributions (e.g. dividends, share buy-backs etc).

Grants will be claimed via the Gov.uk website and administered by HMRC.

First claims will be able to be made about a month after the beginning of the scheme and payment will occur only after payments to employees for the period have been made and reported to HMRC through the RTI system.

Detailed guidance was published on 30 October. However, following the deferral of the scheme’s start date, this guidance is now marked ‘withdrawn’.

Government guidance

• We anticipate that a number of rules governing pay and hours will be similar to those used for the CJRS.

• Any wages paid to employees funded by the government grant can be taken into account when deciding whether the minimum earnings requirement is met for employers to claim for the Job Retention Bonus (see CJRS).

Employers may wish to consider whether and how they may be able to access the scheme to support employment once the extended CJRS comes to an end.

https://www.gov.uk/guidance/check-if-you-can-claim-the-job-support-scheme-closed-if-your-business-is-closed?utm_source=17fda362-5444-4e49-bc9e-7edbb0077aef&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial supportFunding category Details Eligibility How to apply Website Additional comments Next StepsJob Support Scheme for businesses legally required to close(JSS Closed)

• On the 9 October, the Chancellor announced an expansion to the JSS to support businesses across the UK required to close their premises due to coronavirus restrictions.

• The scheme has now been deferred and may be implemented after a phasing out of CJRS Extended. This is currently expected to be at the end of March 2021.

• Businesses whose premises are legally required to shut for some period under Health Protection Regulations will receive grants to pay the wages of staff who cannot work.

• The Government will support eligible businesses by paying two thirds of each employees’ salary, up to a maximum of £2,100 a month.

• Employers will not be required to contribute towards wages and only asked to cover NICS and pension contributions.

• Employers have to have a UK bank account and a UK PAYE scheme registered on or before 23 September 2020 to claim.

• This scheme will cover businesses that, as a result of restrictions set by one or more of the four governments in the UK, are legally required to close their premises. This includes premises restricted to delivery or collection only services from their premises.

• Employees must be instructed to and cease work for a minimum of 7 consecutive calendar days.

• The scheme will pay a grant to the employer calculated on the number of eligible employees who have been instructed to and cease work at the relevant premises.

• Employers will only be able to use the scheme for employees who cannot work (paid or unpaid) for that employer.

• Businesses required to close as a result of specific workplace outbreaks by local public health authorities are not eligible for this scheme.

• This is a temporary scheme, available to employers for 6 months and will be reviewed after 3 months.

• Employers will be able to make a claim on a monthly basis online through gov.uk.

Detailed guidance was published on 30 October. However, following the deferral of the scheme’s start date, this guidance is now marked ‘withdrawn’.

Government guidance

• Employers must agree the new scheme with the relevant staff, make any changes to the employment contract by agreement, and notify the employee in writing. This agreement must be made available to HMRC on request.

• HMRC intend to publish the name of employers who have used the scheme, and employees will be able to find out if their employer has claimed for them under the scheme.

Employers should consider whether and how they may be able to access the scheme to support employment once CJRS Extended comes to an end in case they are required to close their premises.

https://www.gov.uk/guidance/check-if-you-can-claim-the-job-support-scheme-closed-if-your-business-is-closed?utm_source=17fda362-5444-4e49-bc9e-7edbb0077aef&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate



Self-employed Income Support Scheme (SEISS)

Grant support for the self-employed and members of trading partnerships whose businesses have been negatively impacted by COVID-19. These consist of four grants covering periods up to 30 April 2021. The claim deadlines for the first two grants closed on 14 July and 19 October, respectively, so they are not covered in detail here.

Third Grant (increased on 5 November)Taxable grants to be paid of up to 80% of average monthly profits over the previous three years (based on average profits reported on tax returns filed for 2016/17, 2017/18 and 2018/19). It is calculated on based on 80% of 3 months’ average trading profits, paid out in a single instalment and capped at £7,500. This will cover the period from 1 November 2020 to 29 January 2021.

The grant opens for claims on 30 November 2020. The closing date is 29 January 2021.

Fourth GrantThe fourth grant will cover the period from 1 February 2021 to 30 April 2021, but the amount has not yet been announced.

For all four grants, taxpayers need to have made more than 50% of their total income from self-employment or as a member of a trading partnership with profits of less than £50,000. This is assessed by reference to:• Trading profits and total income in

2018/19, and/or• Average trading profits and total income

across up to three years including 2016/17, 2017/18 and 2018/19.

Need to have filed a tax return for the 2018/19 tax year including self-employment income or profits/losses from a trading partnership by 23 April 2020.

Need to have traded in 2019/20, be currently trading at the point of application (or would be but for the impact of COVID--19) and intend to continue to trade.

If currently trading, to be eligible for the third grant, the individual must reasonably expect a significant reduction in profits due reduced demand, activity or capacity between 1 November 2020 and 29 January 2021 caused by COVID-19.

Self-employed taxpayers and partners are able to continue to do business whilst claiming the grant.

Taxpayers do not need to have claimed the earlier grants to be eligible for the third and fourth grants.

Parents of new children and military reservists whose profits and income for 2018/19 were affected by caring activities or reservist activities are subject to alternative profit criteria if they would not otherwise qualify for SEISS. If profits for 2018/19 were £50,000 or less, eligibility may be based on 2017/18 income or the average of 2016/17 and 2017/18 income.

HMRC have used existing information to determine potential eligibility for the SEISS and have contacted potentially eligible taxpayers in respect of the First and Second Grants already. This was based on the financial data and whether the 2018/19 tax return had been filed by 23 April 2020.

Those who meet those criteria, as well as the additional conditions regarding current trading status, will need to claim the Third and/or Fourth Grants via HMRC’s portal. Claims for the Third Grant can be made from 30 November 2020. The date for the Fourth Grant is yet to be confirmed, but it is likely to open in February or March 2021.

Those who qualify for the alternative profit criteria for parents of new children and military reservists must contact HMRC to confirm this before making a claim.

https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

The First Grant was announced by the Government on 26 March 2020 and the Second Grant was later announced by the Government on 29 May 2020. The Third and Fourth Grants were announced in the Winter Economy Plan on 24 September 2020, and amendments to eligibility criteria were published on 22 October 2020. An increase in the amount of the Third Grant was announced on 5 November 2020.

For taxpayers who have been in business for less than the 3 year period, HMRC will consider the income and average profits over the years for which taxpayers have been in business.

For taxpayers who are non-UK tax residents or who claim the remittance basis of taxation, non-trading income will be assessed based on their total worldwide income rather than amounts taxable in the UK.

HMRC have also confirmed that taxpayers who are on or took parental leave may still be eligible as they will still be treated as trading during their period of leave.

In his statement in March, the Chancellor noted that in order to benefit from the SEISS, the self-employed should pay tax on the same basis as those in employment. There is no detail on any further changes at this time, but this would suggest that changes to the taxation of the self-employed and members of trading partnerships may be announced in the future.

Applications for the First and Second Grants are now closed.

We expect that HMRC will contact all potentially eligible customers to advise them that they can claim for the Third Grant. Claims for the Third Grant can be made from 30 November 2020.

Taxpayers will also need to retain evidence to demonstrate to HMRC that they are still in business and intend to continue trading in 2020/21 as well as that their demand, activity or capacity has been reduced due to COVID-19. Taxpayers should therefore be prepared to provide evidence to HMRC to support this.

Taxpayers who claimed the Second Grant but want to reconcile HMRC’s figures can do so using Deloitte’s online calculator.

https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-schemehttps://www2.deloitte.com/uk/en/pages/tax/articles/self-employment-income-support-scheme-calculator.html



Defined contribution pension reductions

Relaxation in requirement to consult before reducing pension contributions• Ordinarily, any employer of over 50 employees needs to

conduct a formal 60 day consultation with affected staff if it wants to reduce pension contributions.

• The usual penalty for non-compliance is a fine of up to £50,000.

• On 9 April, the Pensions Regulator announced that it would relax the 60 day requirement where certain requirements are met, thereby permitting temporary reductions in pension contributions.

• Contributions of at least auto-enrolment minima are still required to be paid.

• In addition to this relaxation, the Pensions Regulator has let it be known that whereas it normally wants to hear about late contributions after 90 days, it is currently prepared to wait until 150 days have elapsed.

• Covers any employer, business, charity or non for profit organisation using the Coronavirus Job Retention Scheme.

It is suggested that the Pensions Regulator is informed of any actions, but this is not a requirement.

https://www.thepensionsregulator.gov.uk/en/covid-19-coronavirus-what-you-need-to-consider/automatic-enrolment-and-pension-contributions-covid-19-guidance-for-employers#eff1fd251ecc4af1b8827cadba8c57d4

http://www.actuarialpost.co.uk/article/tpr-update-on-reporting-late-pension-payments-18039.htm

This applies to all forms of defined contribution pension provision, but does not appear to apply to defined benefit plans, where any changes will still require 60 days consultation.Requirements for the consultation relaxation are that:• An employer has furloughed staff

for whom it is making a claim under the Coronavirus Job Retention Scheme.

• The employer is proposing to reduce the employer contribution to a DC scheme in respect of furloughed staff only. For staff who have not been furloughed the existing pension contribution rate will continue to apply.

• The reduced contribution rate for furloughed staff will only apply during the furlough period, after which time it will revert to the current rate.

• The employer has written to its affected staff and their representatives to describe the intended change and the effects on the scheme and on furloughed staff.

Employers who want to reduce contributions may wish to investigate further.

https://www.thepensionsregulator.gov.uk/en/covid-19-coronavirus-what-you-need-to-consider/automatic-enrolment-and-pension-contributions-covid-19-guidance-for-employers#eff1fd251ecc4af1b8827cadba8c57d4http://www.actuarialpost.co.uk/article/tpr-update-on-reporting-late-pension-payments-18039.htm



Statutory Sick Pay “SSP” for Small or medium sized businesses

SSP is payable to qualifying employees and is now payable from day 1 for those who self isolate or are unwell because of COVID-19 (the first 3 days are normally unpaid). The current rate of SSP is £94.25 per week.

HM Treasury has announced that small and medium sized employers (those with fewer than 250 employees) may recover this cost where SSP has been paid to current or former employees as a result of COVID-19 from 13 March for a maximum of two weeks’ sickness per employee.

The scheme covers all types of employment contracts, including:• full-time employees• part-time employees• employees on agency contracts• employees on flexible or zero-hour contracts• fixed term contracts (until the date their contract

ends)

Employers who have a PAYE payroll scheme that was created and started before 28 February 2020, and who had fewer than 250 employees before the same date, will be able to make online claims through the Coronavirus Statutory Sick Pay Rebate Scheme from 26 May 2020.

The repayment will cover up to 2 weeks of SSP and is payable if an employee is unable to work because they:• have coronavirus; or• are self-isolating and unable to work from home; or• are shielding because they’ve been advised that they’re at high risk of severe illness from coronavirus.

The online service to reclaim Statutory Sick Pay (SSP) will be available from 26 May 2020.

Employers will be able to claim for multiple pay periods and multiple employees at the same time.

Updated link:https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19

Qualifying businesses will need to keep records of sickness and sick pay as a consequence of COVID-19 and days of sickness for future recovery.

Online services for applications is now open.

https://www.gov.uk/guidance/claim-back-statutory-sick-pay-paid-to-employees-due-to-coronavirus-covid-19



Kickstart job placements for young people

The £2 billion Kickstart Scheme is to create new 6-month job placements for young people who are currently on Universal Credit and at risk of long-term unemployment. The job placements should support the participants to develop the skills and experience they need to find work after completing the scheme.

Funding is available for 100% of the relevant National Minimum Wage for 25 hours a week, plus associated employer National Insurance contributions and employer minimum automatic enrolment contributions. There is also £1,500 per job placement available for setup costs, support and training.Funding is available following a successful application process. Kickstart is not an apprenticeship, but participants may move on to an apprenticeship at any time during, or after their job placement.

The Kickstart Scheme is available in England, Scotland and Wales.

The job placements created with Kickstart funding must be new jobs. They must not:• replace existing or planned vacancies• cause existing employees or

contractors to lose or reduce their employment

The roles you are applying for must be:• a minimum of 25 hours per week, for 6

months• paid at least the National Minimum

Wage for their age group• should not require people to

undertake extensive training before they begin the job placement

• Each application should include how you will help the participants to develop their skills and experience, including:

• support to look for long-term work, including career advice and setting goals

• support with CV and interview preparations

• supporting the participant with basic skills, such as attendance, timekeeping and teamwork

If you are looking to create 30 or more jobs you can apply directly:https://www.gov.uk/guidance/apply-for-a-grant-through-the-kickstart-scheme

If you are applying for less than 30 job placements, you must apply through a representative of a group of employers (see web-link below) They can submit an application on your behalf, using other employers to create 30 or more job placements in one application: https://www.gov.uk/guidance/check-if-you-can-apply-for-a-grant-as-a-representative-of-a-group-of-employers-through-the-kickstart-schemeIf you are a representative applying on behalf of a group of employers, you can get £300 of funding to support with the associated administrative costs of bringing together these employers.

https://www.gov.uk/guidance/apply-for-a-grant-through-the-kickstart-scheme?utm_source=93eb30ff-f514-4543-8914-d7cc65759d8b&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

https://www.gov.uk/guidance/apply-for-a-grant-through-the-kickstart-schemehttps://www.gov.uk/guidance/check-if-you-can-apply-for-a-grant-as-a-representative-of-a-group-of-employers-through-the-kickstart-schemehttps://www.gov.uk/guidance/apply-for-a-grant-through-the-kickstart-scheme?utm_source=93eb30ff-f514-4543-8914-d7cc65759d8b&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial support

Funding category Details Eligibility How to apply Website Additional comments Next Steps

Local Restrictions Support Grant (LRSG) for England (Tier 2)

• On 22 October 2020 additional funding was announced for cash grants of up to £2,100 per month primarily for businesses in the hospitality, accommodation and leisure sector who may be adversely impacted by the restrictions in high-alert level areas.

• These grants will be available retrospectively for areas who have already been subject to restrictions, and come on top of higher levels of additional business support for Local Authorities moving into Tier 3

• Businesses will receive grants equivalent to 70% of the grants for which legally closed businesses are eligible as follows:

o For properties with a RV of £15k or under, grants of £934 per month;

o For properties with an RV of between £15k-£51k, grants of £1,400 per month

o For properties with an RV of £51k, grants of £2,100 per month

• This scheme will initially run until April, with a review point in January.

• Areas subject to restrictions on socialising for several months, before the tiering system was introduced will have funding backdated to the start of restrictions.

Local authorities have the freedom to determine the precise eligibility criteria for these grants in their local areas.

The guiding principle for local authorities is to use the funding to support businesses which have not been legally required to close, but which are nonetheless severelyimpacted by reduced demand caused by Tier 2 restrictions on socialising.

Grants will be administered by Local Authorities, and businesses are likely to need to apply to their local authority for support. It is up to local authorities to determine the payment schedule and timings for these grants.

Details of grants for Tier 2 can be found here:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/928760/BUSINESS_GRANTS_FACTSHEET.pdf

The Local Restrictions Support Grant counts towards state aid.Payments count towards the total de minimis State aid you’re allowed to get over a 3-year period - €200,000.

If you have reached that threshold, you may still be eligible for funding under the COVID-19 Temporary Framework. The limit for the framework is €800,000.Your local council will ask you to complete a declaration confirming that:• you will not exceed the relevant

State aid threshold• you were not an ‘undertaking in

difficulty’ on 31 December 2019. This applies only to the COVID-19 Temporary Framework

Wet-led pub grants fortier 2 and 3 areas in England

On Tuesday 1 December the prime minister announced an additional £1,000 Christmas grant for ‘wet-led pubs’ in tiers 2 and 3 who will miss out on business during the busy Christmas period.

The payment will be a one-off for December and will be paid on top on the existing £3,000 monthly cash grants for businesses. This will cover those in tiers 2 and 3 forced to reduce their operations as a result of the latest regional measures put in place to contain transmission of the virus.

Pubs that predominantly serve alcohol rather than provide food will be eligible for a one-off £1000 to help make ends meet.

Eligible wet-led pubs across these tiers are invited to apply through their local authority who will be responsible for distributing the grants. The payment will be made once per business for the month of December only.

https://www.gov.uk/government/news/prime-minister-announces-1000-christmas-grant-for-wet-led-pubs

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/928760/BUSINESS_GRANTS_FACTSHEET.pdfhttps://ec.europa.eu/competition/state_aid/what_is_new/covid_19.htmlhttps://www.gov.uk/guidance/innovation-apply-for-a-funding-award#undertakings-in-difficulty--eu-definitionhttps://www.gov.uk/government/news/prime-minister-announces-1000-christmas-grant-for-wet-led-pubs




Economic Resilience Fund Business Development Grants (ERF Phase 3)

This fund is intended to support businesses in Wales with development projects to assist with recovery from the effects of the Covid-19 pandemic and future sustainability.

It expects to support projects that improve the business operation from current circumstances. It welcomes development projects that will help sustain and create jobs for young people (25 and under), people with disabilities and people from BAME communities.

• Micro businesses (employing between 1 and 9 people) will be able to apply for up to £10,000 on the condition they match this with their own investment of at least 10%; For Tourism and Hospitality micro businesses and those micro businesses forced to close due to the short Fire Break lockdown there will be discretion for grant awards of up to 100%;

• SMEs (employing between 10 and 249 people) will be able to apply for up to £150,000. Small businesses (up to 50 employees) will be required to match this with their own investment of at least 10% and medium businesses (between 50 and 249 employees) with at least 20% of their own funding; For Tourism and Hospitality SME’s and those micro businesses forced to close due to the short Fire Break lockdown there will be discretion for grant awards of up to 100%;

• Large businesses (employing 250+ people) will be able to apply for up to £200,000 on the condition they match this with their own investment of at least 50%.

• If the project is creating new jobs for young people (under 25) you may be eligible for a higher level of award.

The business development grants will be open to businesses of all sizes.

The grant fund will be open for applications from the week commencing 26 October 2020 and remain open for four weeks or until funds are fully committed.

The funding is to cover the period from October 2020 to 31st March 2021The projects should address one or more of the calls to action in the Welsh Government’s Economic Action Plan:• Reduce carbon emissions – we want to

enable more of our business base to become carbon light or free.

• Develop Innovation and entrepreneurship - we want to support businesses to innovate, introduce new products and services and succeed.

• Increase Exports and Trade - we want to proactively support trade with the rest of the UK and across the world.

• Create high quality employment, skills development, and Fair Work – we want to improve our skills base and ensure that work is fairly rewarded.

• Develop Automation, and Digitalisation – we want to help our businesses to develop and to remain competitive.

The Welsh Government considers businesses and organisations eligible for this grant even if they have received funding from ERF Phase 1 or 2 or the Non Domestic Rates Grant.

Online eligibility checker. Follow link to the website

https://fundchecker.businesswales.gov.wales/erfphase3

https://fundchecker.businesswales.gov.wales/erfphase3




Economic Resilience Fund in Wales –Restrictions Business Fund

On the 30 November the First Minister announced a £340m package of support directed primarily at the hospitality, tourism and related supply chain sectors. The fund will be split as follows:

• £160m ERF Restrictions Business Fund: To provide operating costs support for short term impact for up to 60,000 businesses that are materially impacted as a result of national restrictions. Linked to the non-domestic rates system.

• £180m ERF Sector Specific Support (operating cost) aligned to defined restrictions (see next page).

The fund consists of two separate grants:ERF Restrictions Business Fund:The ERF Restrictions Business Fund will provide the following financial assistance:• Businesses in the hospitality sectors that

are in receipt of Small Business rate relief (SBRR) and have a rateable value of £12,000 or less will be eligible for a £3,000 payment. Tourism, leisure, retail and supply chain business qualifying for SBRR will also be eligible for this support if they have greater than 40% reduction in turnover during the restriction period.

• Hospitality businesses with a rateable value of between £12,001 and £51,000 being eligible for a £5,000 payment if they are forced to close. Tourism, leisure, retail and supply chain business in the same rateable value bracket will also be eligible for this support if they have greater than 40% reduction in turnover during the restriction period.

• Hospitality businesses with a rateable value between £51,001 and £150,000 being eligible for a £5,000 payment if impacted by the restrictions. Tourism and leisure businesses in the same rateable value bracket will also be eligible for this support if they have greater than 40% reduction in turnover during the restriction period.

How to access the ERF Restrictions Fund:Businesses must be on the non-domestic rates (NDR) rating list for their local authority on 1 September.Hospitality businesses who received the Lockdown Business Grant in October via their Local Authority will begin receiving payments via the ERF Restriction Fund into their bank account during December. These businesses will not be required to re-register their details.For all other eligible businesses to receive any of the ERF Restrictions Fund, businesses will need to register their details, as well as making a short on-line application to their respective local authority for the discretionary elements. These payments will start to reach businesses in January.Business will be able to access the registration and application process to access the funding through the Business Wales and Local Authority websites. Further details on the process will be published shortly.

https://businesswales.gov.wales/coronavirus-advice/

Applications will be dealt with on a first come first served basis. This may lead to applications not being appraised after they have been submitted if the fund is fully committed.

https://businesswales.gov.wales/coronavirus-advice/erf-restrictions-business-fundhttps://businesswales.gov.wales/coronavirus-advice/erf-sector-specific-supporthttps://businesswales.gov.wales/coronavirus-advice/




Economic Resilience Fund in Wales (cont’d) –Sector Specific Support

• The £180m ERF Sector Specific Support (operating cost) package is targeted at Hospitality, Tourism and Leisure (HTL) businesses or supply chain companies who are materially impacted with a greater than 60% impact of turnover as a result of the restrictions.

Eligible businesses will have to be VAT registered, limited companies with turnover above £50,000 and employing staff via PAYE.

Businesses who have accessed the ERF Restrictions Business Fund can also apply for this fund.

For eligible businesses the package of support will provide the following grant awards:• For single employee business, minimum

grant of £2,500• SMEs (up to 249 employees) - £1,500

per employee up to a maximum of 10 employees, representing £15,000 or for those employing more than 10, £1,500 per employee or self-declared operating costs for the restricted period (whichever is the lower amount).

• There would be an upper limit of £100,000 for SME businesses with a digital system based application.

• Large businesses (250+ employees) -£500 per employee for Welsh headquartered large business applicants to a maximum of £150,000, with a manual case by case application via the sector team

A triage tool will be available on the Business Wales website by the 11th of December for businesses to check their eligible for the fund and the fund will open to applications on the week commencing the 11th of January.


Applications will be dealt with on a first come first served basis. This may lead to applications not being appraised after they have been submitted if the fund is fully committed.





Local Restrictions Support Grant (LRSG) for England

• The Local Restrictions Support Grant (LRSG) supports businesses that were open as usual, providing services in person to customers from their business premises, but which were then required to close for at least three weeks due to local lockdown restrictions imposed by government.

• Grants will be based on the rateable value of the property on the first full day of local lockdown restrictions.

• On 9 October, the Chancellor made the LRSG more generous so that businesses in England can receive up to £3,000 per month, and are eligible for payment sooner, after only two weeks of closure rather than three.

• If your business is eligible and has a property with a rateable value of £15,000 or less, you will receive a cash grant of £667 per two weeks of closure (£1,334 per month).

• If your business is eligible and has a property with a rateable value of over £15,000 but less than £51,000, you will receive grants of £1,000 per two weeks of closure (£2,000 per month).

• If your business is eligible and has a property with a rateable value of £51,000 or over, you will receive grants of £1500 per two weeks of closure (£3,000 per month).

The Government is also making an extra £1.3bn of funding available to the devolved administrations in Scotland, Wales and Northern Ireland, allowing them to continue their response to Covid-19 including through similar measures if they wish.

Your business may be eligible if it:• occupies property on which it pays

business rates• is in a local lockdown area and has been

required to close because of the formal publication of local restrictions guidance that resulted in a first full day of closure on or after 9 September. This funding is not retrospective

• has been required to close for at least 3 weeks because of the lockdown

• has been unable to provide its usual in-person customer service from its premises

For example, this could include non-essential retail, personal services or cafes/restaurants that operate primarily as an in-person venue, but which have been forced to close those services and provide a takeaway-only service instead.

Eligible businesses will get one grant for each property liable for business rates within the lockdown zone.

Businesses that are required to close but do not pay business rates may be eligible for funding at the discretion of the local council, as may businesses not required to close but which are severely impacted

Exclusions• Businesses which are able to continue

to operate during the lockdown because they do not depend on providing direct in-person services from their premises

• Businesses that have chosen to close, but have not been required to close as part of a local lockdown

• Businesses that are still subject to national closures such as nightclubs

• Businesses that have reached the state aid limit

You may receive a grant of up to £3,000 per month at the discretion of your local council if:• your business is required to

close but you do not pay business rates

• if your business is not required to close, but has been severely affected, for example as a result of customer businesses being closed

Local councils may at their discretion also provide funding for businesses that don’t pay business rates. Details of this will be published on local council websites.

Details of expansion can be found here:https://www.gov.uk/government/news/job-support-scheme-expanded-to-firms-required-to-close-due-to-covid-restrictions

Local https://www.gov.uk/guidance/check-if-youre-eligible-for-the-coronavirus-local-restrictions-support-grant?utm_source=1a0ab6a8-9697-4d93-b018-0b72b8151375&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

The Local Restrictions Support Grant counts towards state aid.Payments count towards the total de minimis State aid you’re allowed to get over a 3-year period - €200,000.

If you have reached that threshold, you may still be eligible for funding under the COVID-19 Temporary Framework. The limit for the framework is €800,000.Your local council will ask you to complete a declaration confirming that:• you will not exceed the relevant

State aid threshold• you were not an ‘undertaking in

difficulty’ on 31 December 2019. This applies only to the COVID-19 Temporary Framework

https://www.gov.uk/government/news/job-support-scheme-expanded-to-firms-required-to-close-due-to-covid-restrictionshttps://www.gov.uk/guidance/check-if-youre-eligible-for-the-coronavirus-local-restrictions-support-grant?utm_source=1a0ab6a8-9697-4d93-b018-0b72b8151375&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediatehttps://ec.europa.eu/competition/state_aid/what_is_new/covid_19.htmlhttps://www.gov.uk/guidance/innovation-apply-for-a-funding-award#undertakings-in-difficulty--eu-definition



Small business grant aid in England

£20 million of new government funding is available to help small businesses recover from the effects of the coronavirus pandemic.

Small and medium sized businesses will have access to grants of between £1,000 - £5,000 to help them access new technology and other equipment as well as professional, legal, financial or other advice to help them get back on track.

The support will be fully funded by the Government with no obligation for businesses to contribute financially.

Activities supported through the £20 million can include:One-to-many events providing guidance to respond to coronavirus,Grants (£1,000 - £5,000) to help businesses access specialist professional advice such as HR, accountants, legal, financial, IT and digital, and to purchase minor equipment to adapt or adopt new technology in order to continue to deliver business activity or diversify.

The funding has been allocated to Growth Hubs within each LEP area in line with the current ERDF Programme::https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/905154/Growth_Hub_Funding_-_Information_and_Allocations_for_each_LEP_area.pdf

Growth Hubs work across the country with local and national, public and private sector partners - such as Chambers of Commerce, FSB, universities, Enterprise Zones and banks, co-ordinating local business support and connecting businesses to the right help for their needs.

https://www.gov.uk/government/news/20-million-in-new-grants-to-boost-recovery-of-small-businesses?utm_source=d73de287-c359-4e20-b0ee-3f50952053fd&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

.For more information visit (https://www.gov.uk/guidance/england-2014-to-2020-european-structural-and-investment-funds)

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/905154/Growth_Hub_Funding_-_Information_and_Allocations_for_each_LEP_area.pdfhttps://www.gov.uk/government/news/20-million-in-new-grants-to-boost-recovery-of-small-businesses?utm_source=d73de287-c359-4e20-b0ee-3f50952053fd&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate



Covid Corporate Financing Facility (CCFF)

Support for liquidity amongst large firms• Major new scheme being launched by the Bank of England

to help companies which make a material contribution to the UK economy to bridge Coronavirus disruption to their cash flows through loans.

• Up to 12 months support under a Covid Corporate Financing Facility.

• Issued paper will need a short-term rating of A3/P3 / longterm rating of BBB- or above (or to prove financial strength equivalent) as at 1 March 2020.

• On 19th May the BOE announced the following changes to the scheme:

• CCFF facilities that mature post 19th May 2021 will have restrictions on dividends, capital distributions and senior pay

• Business can now repay the CCFF early, no fee will be charged prior to 30 June 2020

• The names of CCFF borrowers will be published from the 4th June

To be eligible the business must have had, prior to being affected by COVID-19, a short or long- term rating of investment grade, or financial health equivalent to an investment grade rating.

As of 9 October any issuer who’s rating has fallen below investment grade during the pandemic will be subject to an additional review from the Treasury to determine eligibility. In addition to the enhanced credit review process described above, any firm whose long-term credit rating falls to, or below, BBB-/Baa3/BBB (low) or equivalent after 1 March 2020 will have their aggregate drawing limit capped at a maximum of £300 million.

Application details and FAQs can be found on the BOE website (see link in website box).

Where potential issuers are unsure on eligibility, having first consulted with their bank they may also contact the BOE at: [email protected]

Initial noticehttps://www.bankofengland.co.uk/markets/market-notices/2020/ccff-market-notice-march-2020

FAQs and application formshttps://www.bankofengland.co.uk/news/2020/march/the-covid-corporate-financing-facility

Companies that do not currently issue CommercialPaper (CP) but are capable of doing so will in principle be eligible to utilise the CP Facility, provided they meet the eligible securities criteria, in other words of investment grade standing. This is based on A3/P3 or above rating for short term debt. Where a third-party rating is unavailable, the BOE will consider using the internal rating assessments from a borrower’s current lenders as a proxy.

Potential borrowers can now apply, through their bank using the application forms here.To apply you will need to liaise with your bank. It is important to note that not all banks issue commercial paper. If your bank does not issue commercial paper, UK Finance will provide a list of banks that are able to assist here.

Coronavirus Large Business Interruption Loan Scheme (CLBILS)

Large business financial support• For all viable businesses with turnover of >£45m.• Loan thresholds will be:

• £25m where turnover is £45m-250m; and• £50m where turnover is over £250m. From

26th may this will be increased to a max of £200m or 25% of turnover – though additional restrictions will apply

• Loans of up to £50m backed by 80% Government guarantee and offered at a commercial rate of interest. NB – the borrower always remains 100% liable for the debt.

• Unlike the CBILS scheme there is no indication (at the moment) that any interest of fees will be covered by Government. Lenders will pay a fee to access the guarantee.

• The maximum repayment term is three years.• Personal guarantees are prohibited for loans under

£250,000. For loans over £250,000 personal guarantees are limited to 20% of amounts outstanding after recoveries of other assets and cannot be on principal homes.

The route to accessing this financing is for borrowers to approach an accredited lender who will then, if necessary, apply to the scheme.The Key criteria are as follows:• Be UK-based in its business activity.• Have an annual turnover of more than £45

million.• Have a borrowing proposal which the lender

would consider viable, were it not for the current pandemic, and for which the lender believes the provision of finance will enable the business to trade out of any short-term to medium-term difficulty.

• Self-certify that it has been adversely impacted by the coronavirus (COVID-19).

• Not have received a facility under the Bank of England’s Covid Corporate Financing Facility (CCFF).

• There is a short list of ineligible sectors which can be found here.

British Business Bank will operate the CLBILS via its accredited lenders.

As such the application will be to an accredited lender (typically your existing lender in the first instance).

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/clbils/clbils-for-businesses-and-advisors/

This scheme will be administered by the banks and we expect it to follow a similar template to CBILS e.g. for assessing “viability” of the borrowing proposal.Lenders will need further information to confirm eligibility. All lending decisions remain fully delegated to the accredited lenders.Companies borrowing more than £50 million through CLBILS will be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan, including a ban on dividend payments and cash bonuses, except where they were previously agreed.The Government has extended the guarantee available on these loans for up to 10 years –providing additional flexibility for lenders to extend payment terms

The scheme launched on Monday 20 April 2020.The scheme will be open for applications in excess of £50m from 26th MayThe scheme is open for applications up to the end of January 2021.

mailto:[email protected]://www.bankofengland.co.uk/markets/market-notices/2020/ccff-market-notice-march-2020https://www.bankofengland.co.uk/news/2020/march/the-covid-corporate-financing-facilityhttps://www.bankofengland.co.uk/news/2020/march/the-covid-corporate-financing-facilityhttps://www.ukfinance.org.uk/covid-19-corporate-financing-facilitieshttps://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/clbils/current-accredited-lenders-and-partners-2/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/for-businesses-and-advisors/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/clbils/clbils-for-businesses-and-advisors/


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial supportFunding category Details Eligibility How to apply Website Additional comments Next StepsCoronavirus Business Interruption Loan Scheme (CBILS)

Small business financial support• For businesses with turnover of up to £45m, with the

scheme open from 23 March 2020.• Lending scheme through the British Business Bank

from £50,001 up to £5m per company with government meeting interest costs for the first 12 months. Finance terms are from three months up to 6 years for term loans and asset finance and up to three years for revolving facilities and invoice finance.

• The scheme provides the lender with a government-backed guarantee against 80% of the outstanding facility balance, potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’. NB – the borrower always remains 100% liable for the debt.

• The first 12 months of these loans will be interest free, as the Government will cover these payments.

• The scheme has now been amended to apply to ALL viable businesses, not just those that are unable to secure regular commercial financing.

• Personal guarantees are prohibited for loans under £250,000. For loans over £250,000 personal guarantees are limited to 20% of amounts outstanding after recoveries of other assets and cannot be on principal homes.

The route to accessing this financing is for borrowers to approach 40+ accredited lenders who will then, if necessary, apply to the scheme.The Key criteria are as follows:• Be UK based, with turnover of no

more than £45 million per annum.• Application must be for business

purposes.• More than 50% of turnover must

come from trading.• The CBILS facility must primarily be

used to support trading in the UK.• The Company must have a borrowing

proposal that would be viable were itnot for COVID-19

• Not have been classed as a ‘undertaking in difficulty’ on 31 December 2019, if applying to borrow £30,000 or more.

• There is a short list of ineligible sectors which can be found here.

It’s simple to apply and should take no longer than a standard application. Any small business interested in CBILS should, in the first instance, approach one of the 40+ accredited lenders with their borrowing proposal (recommended approach is through the lender’s website).

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

In one sense this is the Government guaranteeing the lender, not the borrower. The application process for loans is the same as for a normal high street loan.Lenders have now started to publish their own guidance on loans being made available under the scheme.The Government also announced on the 27th April that there would no longer be a portfolio cap for lenders issuing CBILS loans, the viability test has also been refined to remove the need to demonstrate the loan will see the business through the short-to-medium term difficulty caused by COVID-19. The PRA has issued guidance to lenders around assessing future performance in the context of the current environment.The Government has extended the guarantee available on these loans for up to 10 years – providing additional flexibility for lenders to extend payment terms

The CBILS scheme is now confirmed as open, meaning prospective borrowers should be able to apply through any accredited lender.

The scheme is open for applications up to the end of January 2021

Bounce Back loan scheme

Loan scheme for small and medium sized businesses backed by a 100% Government Guarantee• Loans of between £2,000 and £50,0000 (up to 25% of

turnover). Interest set at 2.5% per annum• The Government will guarantee 100% of the loan and

there will be no fees, interest or principal repayments for the first 12 months. Loan terms will be for up to 6 years.

• The scheme will be delivered through a network of accredited lenders. You cannot have also accessed CBILS, CLBILS or CCFF (but a CBILS loan can be converted).

• Pay as You Grow terms allow borrowers to:• Extend repayment terms to up to 10 years• Take a six month period on interest only; or• Pause all payments for six months if in difficulty

The key eligibility criteria are:• Engaged in trading or commercial

activity in the UK and established prior to 1st March 2020.

• You have been negatively affected by coronavirus.

• Not in bankruptcy, liquidation or debt restructuring at point of application.

• You were not an ‘undertaking in difficulty’ on 31 December 2019 (if you were you must confirm you comply with de minimis state aid rules).

• More than 50% of turnover must come from trading.

• There is a short list of ineligible sectors which is consistent with the CBILS scheme.

The scheme is now open and businesses can apply through online forms available on accredited banks websites. The list of accredited lenders can be found here.

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/for-businesses-and-advisors/

This is intended as being straightforward, rapid to access finance for smaller businessesPay as You Grow terms provide additional flexibility and borrowers should be able to utilise these terms without impacting their credit rating

On 5 November, the Government announced that businesses who have borrowed less than their maximum (i.e. the lower of £50,000 or less than 25% of their turnover) are able to top-up their existing loan. Businesses will be able to take-up this option from next week; they can make use of this option once.

The scheme is now openand businesses can apply through online forms available on accredited banks websites

The scheme is open for applications up to the end of January 2021

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/accredited-lenders/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/for-businesses-and-advisors/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/current-accredited-lenders-and-partners/https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/for-businesses-and-advisors/


Government Funding – Summary of announced schemes in the UKA raft of measures have been announced by the government regarding financial supportFunding category Details Eligibility How to apply Website Additional comments Next StepsFuture fund Convertible loans, with matched Government funding for

innovative companies.• £125,000 - £5m convertible loans subject to at least equal

matched funding from private investors (no cap on private funding amount)

• Targeted at companies that rely on equity funding and therefore are unsuitable for loan support.

• The scheme will be delivered by the British Business Bank and became available on the 20 May 2020

• There are certain restrictions on the use of the proceeds• Depending on the scenario (fund raising, sale, IPO, etc.) the

loan will either convert to equity at a discount rate of a minimum 20% OR be repayable in full plus a redemption premium of 100% of the principal.

• The interest rate on the loan will be a minimum of 8% (or higher if a higher rate is agreed with the matched investors).

• Maximum maturity on the loan will be three years.• There is a standard set of loan agreements which the

Future Fund and third party investors invest in and cannot be negotiated.

Changes to the scheme’s eligibility criteria announced on 30 June 2020 mean that UK companies who have participated in highly selective accelerator programmes and were required, as part of that programme, to have parent companies outside of the UK, are now able to apply for investment.

Company eligibility criteria::• Have raised at least £250,000 in equity

from third-party investors in previous funding rounds in the last five years

• Only the ultimate parent company in a group can apply

• Not have any of its shares or other securities listed on a regulated market, a multilateral trading facility, a recognised investment exchange and/or any other similar market, stock exchange or listing venue

• Must be a UK incorporated limited company

• Must have been incorporated on or before 31 December 2019

• At least one of the following must be true for the company:

• Half or more employees are UK based

• Half or more revenues are from UK sales

There are also criteria for the matched investor, which are listed by the British Business Bank.

Create an accountThe investor, or lead investor of a group of investors, creates an account on the website to be able to sign in and make applications.Check EligibilityThe investor, or lead investor of a group of investors, provides information regarding the investment and confirms their eligibility.Submit applicationThe investor, or lead investor of a group of investors, submits their applications in connection to an eligible company, and the company then confirms it is happy for the application to be submitted.

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/future-fund/

Detailed documentation has been published on the British Business Bank website. The documentation is standardised and not open to negotiation. https://www.british-business-bank.co.uk/wp-content/uploads/2020/05/Convertible-Loan-Agreement-FINAL-VERSION-17.5.20.pdf

All investors participating in the Future Fund loan must meet certain criteria, which are listed here.

There are certain restric

Documents

COVID-19 - Government Funding · 2020. 12. 4. · ©2020 Deloitte LLP 2 This document summarises the UK Government’s funding response to COVID- 19 to date. We aim to update this