Rishi Sunak Announces Bounce Back Loan Scheme

Rishi Sunak Announces Bounce Back Loan Scheme

Chancellor Rishi Sunak has announced that small businesses will be able to access loans of up to £50,000 through the Bounce Back Loan Scheme which will be 100% government-backed. This announcement comes after many small businesses said they were either being rejected for the Coronavirus Business Interruption Loan Scheme or that credit checks by banks were taking too long. Therefore, the government has decided to back the loan with a 100% guarantee.

How to apply?

The “Bounce Back Loan” scheme is aimed at small and micro businesses which many believe are the backbone of the British economy. This scheme has been designed so businesses can access money quickly. Businesses will be able to apply for this scheme online through a short application form which will launch on Monday 4 May. If your application is successful, the money will be in your business account within a few days. No credit check is needed as this is a 100% government-backed loan.

Terms of the loan    

  • No fees or interest in the first 12 months
  • No capital repayments due in the first 12 months
  • Loan term of up to 6 years
  • Businesses can borrow anything between £2,000 and £50,000

Eligibility

You can apply if your business:

  • Is based in the UK
  • Has been negatively affected by the coronavirus
  • Was not an ‘undertaking in difficulty’ on 31 December 2019

Businesses that cannot apply

  • banks, insurers, and reinsurers (but not insurance brokers)
  • public sector bodies
  • state-funded primary and secondary schools
  • You cannot apply if you are already claiming on the Coronavirus Business Interruption Loan Scheme

It is important to note that if you received a loan through the Coronavirus Business Interruption Scheme of up to £50,000, you can arrange to switch it to a Bounce Back Loan scheme with your lender up until 4 November 2020.

Please visit the Government guidance website to keep up to date with announcements.

How can we help

At Hawsons we have a dedicated team of accountants at our offices in Sheffield, Doncaster, and Northampton. We understand that it is currently a difficult time for businesses and individuals. Our experts can financially advise you and your business through these difficult times.

Book your free initial meeting here.

 

Free initial meeting

Chris Hill

Senior Partner, Sheffield

0114 266 7141
Large number of SMEs decide to furlough staff

Large number of SMEs decide to furlough staff

Latest Statistics show that over 70% of SMEs have furloughed staff

The Chamber of Commerce has announced that over 70% of small and medium-sized businesses have furloughed at least some of their staff. These businesses are currently awaiting government funding from the Job Retention Scheme which is up to 80% of wages costs with a £2,500 monthly cap per employee. Survey results have shown that 71% of businesses furloughing staff has increased from the position last week of 66%, with 30% saying they have furloughed over 75% of their workforce.

Applications for the Job Retention Scheme opened on Monday and the Chancellor Rishi Sunak said that in the first 8 hours of opening they had registered over 1 million staff onto the scheme. However, Government budget forecasters have suggested that 30% of all employees could be registered on the scheme during a 3-month lockdown. Which would cost the Government an expected £42bn.

Official figures have suggested that 25% of businesses have stopped trading completely on a temporary basis. The remaining 75% of businesses have furloughed on average 20% of their staff as workloads decrease. The purpose of this scheme is to prevent the unemployment rate rising during this period, which we have seen in a number of countries around the world which could have long-lasting effects on the economic recovery. Additionally, it will enable businesses and employees to return to normality as quickly as possible once the pandemic is over.  

How to apply for this scheme?

The government will require the employer’s “ePAYE” reference. You can then use the “PAYE Online for Employers” portal to make your claim. These login details should have been sent to you when you first started using PAYE.

To check that you can access this portal please click here

It does not take long to apply for this service, but you will need authorisation codes which often take around 10 days to arrive. You will not be able to access the scheme without these details.

This information may change as the scheme is developed and we will let you know as soon as we know any new information.

To register for the scheme please follow this link: https://www.gov.uk/guidance/claim-for-wages-through-the-coronavirus-job-retention-scheme

How can we help?

At Hawsons we have a dedicated team of payroll staff at our offices covering Sheffield, Doncaster, and Northampton. Our experts can help you decide which government support scheme is best for you and your business. 

If you would like advice for our experts please book your free initial meeting here

Free initial meeting

Scott Sanderson

Partner, Sheffield

0114 266 7141
The Government has announced a scheme worth £1.25bn to help start-ups

The Government has announced a scheme worth £1.25bn to help start-ups

Government announce scheme worth £1.25bn to help start-ups

This new scheme is for start-up businesses that do not qualify for any of the other COVID-19 business support schemes. Chancellor Rishi Sunak said this would help start-ups through this difficult period plus it would boost the growth of UK’s economy once the coronavirus pandemic crisis has subsided. Many start-up businesses lose money in their first few years of trading meaning they cannot apply for Coronavirus Business Interruption Loan Scheme. The Government want to make sure that the coronavirus pandemic does not sink the UK’s fast growing innovative businesses – which are deemed riskier investments that do not lend easily to bank funding criteria.

Are there strings attached?

Yes – there are strings attached, firstly, to be eligible for government investment your company must have raised private funds of at least £250,000 in the last five years. Secondly, any investment made by the government must be matched by private investors.

It should also be noted that if the government is not repaid then they will take an ownership stake in your company. The entrepreneur community has generally accepted this scheme and this is welcomed support. However, there are concerns over the complexity of the scheme which could catch out businesses looking for quick investment – something that is apparent in many other support schemes outlined to date.

Coronavirus Business Interruption Loan Scheme

Pressure is now being put on the government to increase the loan guarantee from 80% to 100% on the Coronavirus Business Interruption Loan Scheme. The main reason for this is that just over £1bn of government-backed loans have been approved out £330bn total support package. Many firms have said that banks have not approved their loan due to banks being left to cover 20% of the losses if the loan cannot be repaid, with the banks wanting sufficient recourse and/or headroom in the event of the business failing. It is hoped that the increase in government guarantee increasing to 100% will remove some of the barriers being faced by businesses during the application process.

How can we help

At Hawsons we have a dedicated team of accountants at our offices in Sheffield, Doncaster, and Northampton. Our expert accountants can advise you which coronavirus support schemes would be best for your business.

Book your free initial meeting here.

Free initial meeting

Scott Sanderson

Partner, Sheffield

0114 266 7141
March retail sales decline due to coronavirus lockdown

March retail sales decline due to coronavirus lockdown

March retail sales decline due to coronavirus lockdown

Retail sales in March decreased by 4.3% compared to 2019, according to the British Retail Consortium (BRC). Figures from Barclaycard advocated a large increase in supermarket sales as individuals began to stockpile food.

March was seen as a rollercoaster month as demands for food saw remarkable growth. But there was a huge decrease in sales for non-essential stores on the high street after government restrictions forced them to close.

As households began to adjust to life in isolation there were increases in sales of fitness equipment, computers, and games. Whereas sectors such as fashion lost out massively. 40% of non-food sales were made online in March.

With retailers currently under a huge amount of pressure it means that hundreds of thousands of jobs are now at risk due to the high street shutdown, said Helen Dickinson the head of the BRC.  “The crisis continues; the retail industry is at the epicentre and the tremors will be felt for a long while yet,” she said.

Fuel sales decreased as more people are working from home and fewer journeys being made to retail, leisure, and hospitality businesses.

Data suggests that supermarket sales increased by 20% and spending at off-licenses and greengrocers increased by 30% as households started to stock up food and drink.

The current message to individuals and households is to be responsible, do not panic buy and think of others, for example, NHS workers.

Please see our COVID-19 webpage to see all the business support and employee measures put in place by the government.

How can we help

Hawsons has a dedicated team of specialist retail, wholesale and e-commerce accountants in Sheffield, Doncaster, and Northampton. Our specialist team offers a wide range of services which are tailored to meet your individual needs. Our understanding of the issues faced by the retail, wholesale and e-commerce sector means that we can proactively seek out ways for you to maximise your profitability and minimise your tax liabilities.

If you would like to book your first free initial meeting, please click here.

If you would like to find out more about Hawsons please visit our website here.

More from our retail experts

You can find all of our latest retail sector news and newsletters here.

If you are looking for advice in a particular area, please get in touch with your usual Hawsons contact.

Alternatively, we offer all new clients a free initial meeting to have a discussion about their own personal circumstances – find out more or book your free initial meeting here. We have offices in Sheffield, Doncaster and Northampton.

Free initial meeting

Pete Wilmer, Corporate Finance Partner

Pete Wilmer

Corporate Finance Partner

0114 266 7141
Coronavirus Job Retention Scheme Update

Coronavirus Job Retention Scheme Update

How to apply for a furlough grant

The application webpage for the government job retention scheme is expected to go live on 20 April with grants being subsequently paid from 30 April. Authorised agents who act for PAYE purposes should be able to make claims on behalf of clients. However, the Tax faculty has recently sought further information regarding the type of authorisation required: 64-8, FBI2 and online agent authorisation. But any unauthorised or file only agents will not be able to claim on behalf of clients.  

How do I submit my claim?

The government will require the employer’s “ePAYE” reference. You can then use the “PAYE Online for Employers” portal to make your claim. These login details should have been sent to you when you first started using PAYE.

To check that you can access this portal please click here

It does not take long to apply for this service, but you will need authorisation codes which often take around 10 days to arrive. You will not be able to access the scheme without these details.

This information may change as the scheme is developed and we will let you know as soon as we know any new information.

Furlough scheme cut-off extended to 19 March

The government’s decision to extend the date of eligibility to 19 March 2020 means that thousands more employers will be able to receive financial support through this scheme. You can now claim on this scheme for furloughed employees who were on your PAYE payroll on or before 19 March 2020 and which were notified to HMRC via an RTI submission on or before that date.

More information can found here.

How can we help?

At Hawsons we have a dedicated team of accountants at our offices in Sheffield, Doncaster, and Northampton. Hawsons is one of the longest standing firms of independent chartered accountants in England and recently celebrated 165 years or providing expert advice to businesses of all types and sizes.

If you would like to book your free initial meeting, please click here

If you want to find out more about Hawsons visit our website here

Free initial meeting

Simon Bladen

Partner, Sheffield

0114 266 7141