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Coronavirus

The world is facing unprecedented impacts from the 2019 Coronavirus (COVID-19). The impact to people, businesses and supply chains is unfolding, with challenges in almost every location on the globe. As the response continues, how can you prepare and respond?

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Latest announcements from the Government:

Changes to insolvency rules to allow firms “greater flexibility as they face the current crisis”: Latest announcements to help UK businesses

On Saturday, Alok Sharma, the UK business secretary announced new insolvency measures to prevent businesses unable to meet debts due to the impact of coronavirus from being forced to file to bankruptcy.

Changes include:

  • Allow companies undergoing a restructuring process to continue to have access to supplies and raw materials
  • A temporary suspension of wrongful trading provisions for company directors to remove the threat of personal liability during the pandemic, which will apply retrospectively from March 1st
  • Companies required to hold annual general meetings will be able to do so flexibly in a matter compatible with public health guidance, which may include postponing or holding the AGM online, or by phone using only proxy voting

The announcement aims to allow directors to pay staff and suppliers even if they are concerned that the company could become insolvent and would allow more companies to “emerge intact the other side of the Covid-19 pandemic”. It is good to see that the government is making significant changes to policies during this time and protecting as many businesses as they can. However, for many businesses questions still remain as to what the next few months will look like.

“You have not been forgotten”: Measures announced to protect the UK’s self-employed workforce

Today the Chancellor had a clear message as he announced a series of measures to help the UK’s self-employed workforce. While he highlighted the difficulties that the diverse pool of the UK’s self-employed present, the package announced today should help 95% of the self-employed population and be targeted to those in the most need. The package included:

  • The Self-Employed Income Support Scheme: Self-employed workers with a trading income of £50K or less, will receive a taxable grant from the government of 80% of their average income based on their average income over a 3 month period up to £2,500. This is the same amount as furloughed employees will receive
  • The government will also be allowing those self-employed workers who missed the tax assessment deadline will now have four more weeks in which to submit their return

This is in addition to those measures introduced earlier by the Chancellor which included the Business Interruption Scheme and reducing the income floor so that self-employed workers can access universal credit. This is a difficult time for all businesses, but it’s encouraging to see the government’s commitment to protecting jobs as far as possible.

“You must stay at home” – Prime Minister Boris Johnson announces restrictions on people in the UK leaving their homes

On Monday night’s daily broadcast, Prime Minister Boris Johnson announced that from Monday evening, UK residents must stay at home to stop the virus from spreading between households. Here at Close Brothers we’ve produced a roundup of the government’s latest announcements and what this means for people across the UK.

People will only be allowed to leave their homes for:

  • Shopping for basic necessities, as infrequently as possible
  • One form of exercise a day such as a run, walk, or cycle, alone or with members of your own household
  • Any medical need: to provide care or to help a vulnerable person
  • Travelling to and from work: However, this should only be done when it is absolutely necessary and when you cannot work from home

The government will immediately:

  • Close all shops selling non-essential goods: including clothing and electronic stores – as well as other premises like libraries, playgrounds and outdoor gyms, and places of worship
  • Stop all social events: including weddings, baptisms and other ceremonies, but allow funerals. Parks are remaining open for exercising but gatherings of more than two people will be dispersed.

For any employees that had been continuing to go to work, last night’s announcement has encouraged all employees that can be done at home to do so going forward. At Close Brothers we understand that these measures are likely to have a significant impact on businesses and how they continue to operate going forward. We will continue to share useful resources and articles to support you and your business navigate this difficult time. If you need advice on how to be productive when working from home please find our tips here.

“We will stand by you”- Government announces new measures to support businesses and employees

In Friday’s daily conference, the Chancellor announced what he called ‘unprecedented measures” in order to help British businesses weather the storm, and keep paying their employees. Here at Close Brothers we’ve put together a round up of all the measures announced which will impact businesses across the country:

  • Coronavirus Job Retention Scheme: The government has announced that it will pay 80% of employees’ wages up to £2,500 in order to prevent staff from being laid off by those businesses most impacted by the virus. This scheme will last 3 months and there will be no limit to the amount of funding that the government will provide. For businesses should contact HMRC for the grant which should be ready within weeks.
  • Coronavirus Business Interruption Scheme: The Chancellor has announced that this scheme will now be made interest free for 12 months. This will be available from Monday.
  • Defer VAT payments for businesses: This will be to support businesses with their cash flow in order to help them pay their employees. Businesses will defer their VAT payments from now until June until the end of the financial year.
  • Reduce the minimum income floor suspended for the self-employed: this means that self-employed workers can access universal credit equal to statutory sick pay.
  • Defer self-assessment tax payments: These will be deferred until January 2021.

As the Chancellor mentioned these are difficult times for all- particularly for small businesses. We, at Close Brothers are encouraged to see these measures introduced to support the UK’s businesses. We will continue to share updates as announced by the government as well as some helpful tips and guidance to help everyone survive and thrive in difficult times.

  • Schools across England, Scotland, Wales and Northern Ireland are to close for the majority of pupils on Friday because of the coronavirus epidemic
  • School exams are to be cancelled this summer, with GCSEs and A-levels to be graded on work already completed
  • Schools will focus on looking after the children of keyworkers and vulnerable children
  • Chancellor Rishi Sunak has announced that £330bn will be made available in loan guarantees for businesses affected by the pandemic
  • The one year business rates holiday has been extended to all retailers as part of the government’s updated economic support for UK businesses and amid the coronavirus crisis
  • Cash grants for the UK’s smallest businesses have been increased from £3000 to £10,000
  • For those without insurance, Sunak said there would be an additional cash grant of up to £25,000 per business to help them mitigate the economic impact of the coronavirus pandemic
  • The Government has advised against "non-essential" travel and contact with others
  • People should avoid pubs, clubs and theatres, and work from home if possible
  • Pregnant women, people over the age of 70 and those with certain health conditions are urged to consider the advice "particularly important” and will be asked to self-isolate within days