Financial support for businesses during coronavirus
(Covid-19)

Summary of Government Support Initiatives

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Grants and loans for businesses
and the self employed

Coronavirus Bounce Back Loan

  • This scheme helps small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover.  The maximum loan available is £50,000.
  • Scheme is open to applications until 31 March 2021.
  • Government guarantees 100% of the loan.
  • No repayments, fees or interest due for the first 12 months.  After the first 12 months the interest rate will be 2.5% a year.
  • If you already have a Bounce Bank Loan but borrowed less than you were entitled to, you can top up your existing loan to your maximum amount.  You must request the top up by 31 March 2021.
  • Length of loan is 6 years but you can repay early without paying a fee.
  • Eligible to apply if business UK based and has been adversely impacted by the coronavirus.
  • If your business was classed as a business in difficulty on 31 December 2019, you will need to confirm that you are complying with additional state aid restrictions.
  • If you need a larger loan you may be entitled to other government support.
  • Further guidance and how to apply available at www.gov.uk

Coronavirus Job Retention Scheme ("CJRS")

  • If you cannot maintain your workforce because your operations have been affected by coronavirus (COVID-19) you can furlough employees and apply for a grant to cover a portion of their usual monthly wage costs where you record them as being on furlough.
  • You can no longer submit claims for claim periods ending on or before 31 October 2020 and you can only claim for furloughed employees that were employed and on payroll on 30 October 2020.
  • Any entity with a UK payroll can apply, including businesses, charities, recruitment agencies and public authorities.
  • The Coronavirus Job Retention Scheme has been extended until 30 April 2021.  You can claim 80% of an employee;s usual salary for hours not worked, up to a maximum of £2,500 per month.
  • Find out if you are eligible and how much you can claim to cover wages for employees on temporary leave ('furlough') due to coronavirus (COVID-19).
  • Further information, guidance and how to make a claim is available at www.gov.uk

Support measures for the self employed

  • If you're self employed or a member of a partnership and have been impacted by coronavirus (COVID-19) you may be eligible to use this scheme to claim a grant.
  • The Self-Employed Income Support Scheme (SEISS) has been extended.  If you were not eligible for the first and second grant based on the information in your Self Assessment tax returns you will not be eligible for the third.
  • The online service to claim the third grant is open - if you're eligible you must make your claim for the third grant on or before 29 January 2021.

Additional financial support for businesses

  • Repayment of statutory sick pay - the Coronavirus Statutory Sick Pay Rebate Scheme (CSSPRS) will repay employers the statutory sick pay paid to current or further employees.  Further guidance and how to make a claim available here
  • Insurance - Businesses that have insurance for a pandemic can claim. 

Coronavirus business interruption loan scheme ("CBILS")

  • The Coronavirus Business Interruption Loan Scheme (CBILS) provides financial support to smaller business affected by coronavirus (COVID-19).
  • Scheme helps small and medium-sized businesses to access loans and other kinds of finance up to £5 million.
  • Government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months.
  • Scheme is open until 31 March 2021.
  • Eligible to apply if business is UK based and has annual turnover of up to £45 million.
  • If you wish to borrow £30,000 or more you also need to confirm that your business wasn't classed as a business in difficulty on 31 December 2019.
  • Maximum length of facility depends on type of finance applied for and will be up to three years for overdrafts and invoice finance facilities and up to six years for loans and asset finance facilities.
  • 117 lenders are participating in the scheme including all the main retain banks.
  • How to apply and further information available at www.gov.uk


Top up to local business grant funds scheme

  • Local Restrictions Support Grant (Sector) available from local councils if business is a nightclub, adult entertainment or dance hall that has been closed by law since 16 March 2020 because of national coronavirus restructions.  More information available at www.gov.uk


  • The Additional Restrictions Grant (ARG) provides local councils with grant funding to support closed businesses that do not directly pay business rates as well as businesses that do not have to close but which are impacted.  In addition, larger grants can be given than those made through LRSG (Closed).  Local councils can determine which businesses to target and the amount of funding from ARG.  More information available at www.gov.uk
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Deferment and liquidity

  • Deferring VAT - automatic offer with no application required.  No business will need to pay Value Added Tax until after June 2020 - no interest or penalties will be charged on any amount deferred - returns still need to be submitted on time - to be repaid before the end of the 2020/21 tax year.
  • Deferring income tax - income tax payments due on 31 July 2020 may be deferred until 31 January 2021.  No application required, offer is automatic, no interest or late payments will be charged.  Check eligibility criteria.
  • HMRC time to pay - has been around since the global financial crisis in 2008 but is likely to be available on more generous terms by calling HMRC's dedicated line on 0800 0159 559.
  • Three month extension period to file accounts - businesses will be given an additional three months to file year end accounts with Companies House to help companies avoid penalties as they deal with the impact of COVID-19.  Applications can be made by phone 030 1234 500 or online via the normal filing gateway.
  • New HMRC tax payment helpline launched - to help businesses concerned about paying their tax due to Coronavirus (COVID-19) .  If you run a business or are self-employed and are concerned about paying your tax due to Coronavirus, you can call HMRC’s helpline for help and advice: 0800 024 1222.

Updates to Insolvency Legislation

Under the plans, the UK’s Insolvency Framework will add new restructuring tools including: 

  • A moratorium for companies giving them breathing space for from creditors enforcing their debts for a period of time whilst they seek a rescue or restructure; 
  • Protection of their supplies to enable them to continue trading during the moratorium; and
  • A new restructuring plan, binding creditors to that plan.

The proposals will include key safeguards for creditors and suppliers to ensure they are paid while a solution is sought. 

The government will also temporarily suspend the wrongful trading provisions to give company directors greater confidence to use their best endeavours to continue to trade during this pandemic emergency, without the threat of personal liability should the company ultimately fall into insolvency. 

Existing laws for fraudulent trading and the threat of director disqualification will continue to act as an effective deterrent against director misconduct. 

In February 2021 the government confirmed that it intends to extend the power (granted through the Corporate Governance and Insolvency Act 2020) to make temporary amendments to modify the effects of corporate insolvency and governance legislation for an additional year.

The government laid the regulations on 11 February 2021 in Parliament ahead of the power expiring on 30 April 2021.

Further details can be found in the BEIS press release

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For business advice in these challenging times
please contact us on 0800 331 7417




Updated January 2021