Government Support for Coronavirus Business
There’s not a single business that hasn’t been affected by the wave of the pandemic. The way the world used to interpret and legitimize business has completely inverted, hence it has greatly altered the economical and social perspective of every business module.
Although the global pandemic has lowered the income value, multiple efforts are being put forward to stabilize the loss in a possible way. In order to provide people an opportunity to establish their businesses again, the UK government has announced numerous aids and funding schemes.
The core purpose of these schemes is to give equal opportunity to all businesses that are widely affected by COVID-19 and to help them flourish back to their previous state. Moreover, the schemes are fully designed to follow a proper process under which the most eligible businesses would be selected.
Below are the schemes that are being introduced by the government of the UK along with their complete process of implementation. We have also explained what is the exact eligibility criteria and how much revenue the scheme offers to business owners.
Local Restrictions Support Grant (Closed Businesses)
All businesses that were functioning properly, but closed down due to the pandemic, will receive Local Restrictions Support Grants (LRSG) which is approximately £3000 per month. All these eligible businesses can obtain their cash grants from their local council.
As every business has a different market value and size, it pertains to the grants varying from business to business and following proper divisions accordingly.
Here is how the grant will be distributed.
- If your business rateable value is less or equal to £15,000 then you will be eligible to receive the cash grant of £667 for each 14 days period since the closure of your business.
- If your business rateable value is greater than £15,000 but less than £51,000 then you will be able to receive the cash grant of £1,000 for each 14 days period since the closure of your business.
- If your business rateable value is greater than £51,000 then you will be able to receive the cash grant of £1500 for each 14 days period since the closure of the business.
What makes your business eligible for the fund?
Your business is eligible for Local Restrictions Support Grant LRSG (Closed Businesses) if the following conditions are strictly fulfilled:
- Your business is based within England
- You pay business rates on the property you own
- Your business was closed due to a pandemic and lockdown
- Your business was closed for at least 3 weeks
- The closure restricted in-person customer service
How can you apply for the LRSG fund?
You can easily apply for LRSG( closed business) by visiting your local council’s website.
You may also visit GOV.UK portal and find your local council easily.
2- Pay Deferring VAT Due to COVID-19:
The government of the UK is allowing all the businesses within England to pay their VAT payments before 31 March 2021. The purpose is to compensate for the loss faced by all kinds of businesses due to pandemics.
The support is strictly applicable to regular VAT only not the VAS MOSS. Furthermore, you are eligible for this grant if your VAT payments are due between 20 March 2020 and 30 June 2020.
The interest will be applicable if :
- You don’t pay your defer VAT in full by 31 March 2021
- You don’t join the new payment scheme by 21 June 2021
VAT New Payment scheme:
The new VAT payment scheme will be active in early 2021. The expected date is 23 February 2021 and will be extended to 21 June 2021.
The new scheme will help the business to repay your VAT payments in easy installments within an 11 month period and with zero interest rate. The government has launched this VAT new payment scheme to support thousands of businesses across the United Kingdom. The total scheme is worth £280 billion and has protected millions of businesses and jobs.
What makes your business eligible for the scheme?
The eligibility criteria for VAT is as followed :
- All business within the UK
3- Business Rates Holiday (England):
Along with other perks for small businesses, the government has also provided a business rates holiday to specified sectors. All the businesses covering the leisure, hospitality, and retail sectors are exempted with business rates holiday.
There are numerous businesses like shops, bars, cafes, hotels, and pubs that come in this category.
What makes you eligible for Business Rates Holiday?
The eligibility criteria for business rates holiday is as followed:
- Your business must be centered in England
- The business must be related to hospitality, retail, or leisure
- The business must be legally functional
How to apply?
The relief is implied to any business automatically. You don’t need to register your business for this relief.
The Restart Grants are specifically introduced to help businesses to reopen after the COVID restrictions. The grant will minimize the cost needed to reopen the business after the long break and help them establish the business back to its normal state.
The grant can be availed from 1 April 2021.
The total cost of the Restart grants is worth £5 billion and it will benefit all the non-essential retail and leisure businesses working in England.
The expected amount that will be received by the eligible businesses which include leisure, hospitality, personal care, and gym under Restart Grants is approximately £18,000.
However, all the non-essential retail sectors will receive the amount of £6,000 from their respective local council as a Restart Grant.
The main idea behind the grant is to provide more opportunities to every business after facing loss due to COVID.
What makes your business eligible for Restart Grants?
The eligibility criteria for Restart Grants are as follows:
- The business must be located in England
- The business must be in non-essential retail, hospitality, leisure, or personal care
- The business must be functional on 1 April 2021
How to apply for Restart Grants?
To apply for Restart Business, you need to visit your local council website.
5-Job Support Scheme (JSS) :
If the business has disturbed the daily wages of the employees under a specific business and due to covid restrictions they were unable to earn then, the business can claim for Job Support Scheme easily. The JSS was initiated in November 2020 and intended to prioritize those businesses with minimal activities after the COVID outbreak.
The JSS will be specifically beneficial for those employees whose daily wages are reduced and the earning hours are immensely affected by the current situations.
To claim this scheme, the employees are exempted to work 20% of their usual working hours. In other words, employers will be able to receive 73% of their normal wages.
What makes your business eligible for the Job Support Scheme(JSS)?
The eligibility criteria for the Job Support Scheme is as followed:
- Your business activity has reduced due to COVID and started using the UK PAYE scheme before 23 September 2020
- Registered on PAYE online
- Must possess a UK, Channel Island, or Isle of Man bank account
How to apply for JSS?
To apply for the Job Support Scheme, you need to visit the official website gov. UK and claim for the JSS.
6-Deferring Income Tax:
The government is aimed to provide relief to businesses by deferring their income tax self-assessment payments. This will help them to support their business in a better way and stabilize it from the loss of pandemic.
According to this relief, the business can defer second self-assessment payments up to 6 months.
What makes your business eligible for relief?
The eligibility criteria for deferring income tax is as followed:
- All business based in the UK
- All business with a second self-assessment payment due on 31 July 2020
How to apply?
For this, you dont need to apply anywhere. You just don’t pay HMRC with zero interest and penalty.
7- Protection from eviction for commercial tenants:
If you are living under a commercial tenant and are not able to pay your rent due to a pandemic then you can not be evicted until 31 March 2021. Under this law, every residential who is unable to pay the rental amount is not asked to leave the place until the given date.
Although, you will be responsible for the rent they owe the immediate eviction is prohibited.
The eligibility criteria for the protection is as followed:
- All the business within England, Wales, and Northern Ireland
- All those who can not pay their rental due to corona
How to apply?
There is no application process as this is implied automatically to all eligible businesses.