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As well as serious implications for people's health and the NHS, coronavirus COVID-19 is having a massive impact on businesses and the economy.
Since this novel virus was first identified in Wuhan, China in late 2019, COVID-19 has brought the kind of health, social and economic chaos never seen before in peace time. With the pandemic now wreaking havoc across the world, governments are acting to not only shield their people from its terrifying health effects, but also to prop them up financially.
Thankfully the UK government is now pumping cash into our ailing economy to last for a minimum of three months. A large number of emergency measures have been taken, alongside more long term help, which businesses can also benefit from. They were announced by Chancellor Rishi Sunak during the last week of March, as the reality of coronavirus COVID-19 really hit home. Here we’ve rounded up some of the key points.
On 23rd March the Government outlined stringent and highly unprecedented measures to help prevent the spread of COVID-19. These include social distancing (not meeting up with friends and family outside the ones you immediately live with) and keeping a distance of 2 metres (6ft) from others. Only essential activities like food shopping, medical visits and one form of exercise can be undertaken each day, and only those in essential services should go to work.
With many workplaces closed, support for businesses includes everything from grants and loans to delayed payments and reimbursements. We’ve summarised many of these below, however more in-depth information can be found on the government’s website: COVID-19 support for businesses.
The new Job Retention Scheme allows all UK employers with a PAYE scheme to access support so that they can continue paying staff salaries instead of laying them off. In this way staff will be “furloughed”.
The government is also allowing small and medium-sized businesses to reclaim Statutory Sick Pay provided for staff who have been ill during the coronavirus pandemic.
The COVID-19 Corporate Financing Facility (CCFF) has been launched so that the Bank of England can step in and purchase short-term debt from larger companies. Find out more on the Bank of England website.
If your business falls into the sectors of retail, hospitality or leisure, then a one-off cash grant is being offered to those with a Rateable Value on their occupied property of under £15,000. For businesses with a Rateable Value of more than £15,001 (but under £51,000), the grant is bumped up to £25,000.
This scheme is designed to help businesses affected by the COVID-19 pandemic to access finance of up to £5 million. Again, more can be found about this on the Gov website.
Aimed at self-employed individuals (including members of partnerships), this scheme offers assistance to those who have financially suffered due to COVID-19. More can be found on the Self-employment Income Support Scheme page of the Gov website.
Under the new measures, businesses can now defer their Value Added Tax (VAT) payments for 3 months due to the COVID-19 pandemic. Additionally, Self-Assessment payments on account - which were due for payment by 31st July 2020 - can now instead be deferred until 31st January 2021.
There is still a range of financial support available for businesses, particularly start-ups and those looking to innovate and grow.
Although the measures we’ve discussed are temporary, designed by the government to soften the economic blow of coronavirus COVID-19, even once this time has passed businesses will need to look to the future. Obtaining essential funding to carry out technological and scientific innovative activities will be as important as ever in surviving and thriving. This is where schemes like R&D Tax Credits and R&D Grants come in to play.
R&D (research and development) Tax Credits enable companies to either reduce their Corporation Tax liability or for loss-making companies to surrender losses for a lump sum. Quite simply, they offer a cash injection for R&D work that has already been undertaken. The resulting money can essentially then be spent in any way a company sees fit, with many reinvesting it back into further R&D activities. Not taking advantage of the R&D Tax Credits scheme can mean missing out on thousands of pounds.
The scheme was launched back in the early 2000s to incentivise UK businesses to innovate. Growing companies take over new sites, make leaps forward in science and technology and employ more staff - all of which boosts government tax take.
R&D Tax Credits can be claimed by any UK company in any sector or industry. The range of eligible costs and projects is vast, and the only real proviso is that an appreciable advancement in science or technology should be made. This could be by developing a new product, process or service for instance, or by substantially improving an existing one.
SMEs can claim up to 33 pence back for every pound spent on eligible activities, so we’re not talking pocket change here. For larger companies claiming under the RDEC scheme the relief is less generous but claims tend to be much bigger.
Find out everything you need to know on our R&D Tax Credits webpage.
R&D Grants are very similar to R&D Tax Credits in nature, but are a state aid grant that’s non-repayable rather than a tax relief. They are a particularly popular way of financing innovation for new companies and start-ups, and funding is offered as a competition. Amounts offered range between £25,000 and £10 million. Again you can find out more - and how to claim - on our R&D Grants webpage.
Myriad Associates is made up of a team of expert R&D accountants and specialists all ready and waiting to help you get the money your innovative business deserves. Our 100% success rate speaks for itself, so you know you’re making fully optimised, accurate claim.
Call us today on 0207 118 6045 or use our contact form - your company could well end up with money you didn’t even know existed.