Funding help for businesses affected by COVID -19

With so many schemes and deadlines floating around, we thought it might be useful to share this helpful summary of the main grants and schemes currently available to small businesses and the self-employed affected by the pandemic (mostly taken from the FSB website.

Remember, hardship grants and funding are also available at local authority level to help support businesses through COVID-19 so, to find out what support is available to your specific area, be sure to contact your local council too.

Coronavirus Job Retention Scheme (CJRS)
Available in England, Scotland, Wales, Northern Ireland.

Deadline: Extended until April 2021

Scheme details:  The government will pay at least 80% of employee wages up to a maximum of £2,500 a month.  Employers will be required to pay the National Insurance and pension contributions for each employee.

Job Support Scheme (JSS)
Available in England, Scotland Wales, Norther Ireland

Expected start date: May 2021

Scheme details:  The Job Support Scheme (JSS) will now be introduced when the Coronavirus Job Retention Scheme (CJRS) ends.  The Government will support employers with wages, allowing employees to work shorter hours rather than being made redundant.    The Chancellor also announced that the JSS will be expanded to protect jobs and support businesses required to close as a result of coronavirus restrictions.  All SMEs are eligible (even if you have not used the furlough scheme).

There are two types of support available for businesses to help cover employment costs:

JSS Open – if your business is operating but facing decreased demand.

JSS Closed – if you are legally required to close as a direct result of coronavirus restrictions in the UK.

The Job Retention Bonus

Available in England, Scotland, Wales, Northern Ireland

Starts:  Unconfirmed at the time this article published.

Scheme details:  The Job Retention Bonus was announced as part of the ‘plan for jobs’ announced by the Chancellor in July 2020.  The bonus will now not be paid in February, and a retention incentive will be redeployed at the appropriate time.

Coronavirus Bounce Back Loan
Available in England, Scotland, Wales, Northern Ireland

Deadline: 31 March 2021

Businesses who have borrowed less than their maximum will be able to top-up their existing loan.
Scheme details: 
If you meet the following criteria:

  • UK based business.
  • Negatively impacted by coronavirus.
  • Existed by 1 March 2020.
  • Not ‘undertaking in difficulty’ on 31 December 2019.
  • Have a tax return or business tax account.

You may be eligible for the Bounce Back Loan Scheme, which allows SMEs to borrow between £2,000 and £50,000.  However, the following businesses are exempt:

  • Insurer or re-insurer (but not insurance broker).
  • Bank.
  • Public-sector body.
  • Grant-funded further education establishment.
  • State-funded primary and secondary school.

Loans are capped at 25% of turnover, but there is no turnover limit. The government will guarantee 100% of the loan, with no fees or interest in the first 12 months. Loan terms will be up to 10 years, and no repayments will be due in the first 12 months. If you do decide to pay back in the first year, there is no penalty.

The Pay As You Grow scheme will extend repayments of the Bounce Back Loan:

  • Extended loan terms are estimated to halve the average monthly repayment.
  • The option of interest only repayments.
  • No impact on credit rating.
  • Those in financial difficulty can suspend repayments for up to six months.

Further details on the scheme are expected shortly.

VAT Deferral Payments
Available in England, Scotland, Wales, Northern Ireland

Deadline: 31 March 2022
On 24 September 2020, the Chancellor announced that businesses who deferred VAT due from 20 March to 30 June 2020 will now have the option to pay over the course of 11 payments up until the end of March 2022.
This scheme will require you to opt-in, we will update you on how you can do this when details are published.

To prepare for the scheme, you must:

  • Create your own Government Gateway account if you do not already have one.
  • Submit any outstanding VAT returns from the last 4 years. You will not be able to join the scheme if you have not done so.
  • Correct errors on your VAT returns as soon as possible. Corrections received after 31 December 2020 may not show in your deferred VAT balance.
  • Make sure you know how much you owe, including the amount you originally deferred and how much you may have already paid.

Coronavirus Business Interruption Loan Scheme (CBILS)

Deadline: 31 March 2021

Scheme details: The CBILS helps small and medium-sized businesses to access loans and other kinds of finance up to £5 million.  The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months. 

You can apply for a loan if your business:

  • Is based in the UK.
  • Has an annual turnover of up to £45 million.

You need to show that your business:

  • Would be viable were it not for the pandemic.
  • Has been adversely impacted by the coronavirus.

Businesses from any sector can apply, except:

  • Banks, insurers, and reinsurers (but not insurance brokers)
  • Public-sector bodies
  • State-funded primary and secondary schools

For more detailed information on all the schemes please see the full FSB Funding sources for businesses during the COVID-19 pandemic article.

Plus, did you know you can spread the payment of your personal tax too?
If you cannot afford pay your latest bill, you can set up a payment plan to spread the cost. Check if you qualify.

Other useful funding sites:

All information is correct at time of publication (05.02.2021).