Navigating COVID-19 with Brass Tax
We’d like to thank Wizu member Ian Bavill, Director of Brass Tax Accounting, for allowing us to the share the below information. Striving to support his clients through this difficult time for small business owners, Ian provided them guidance outlining the possible financial implications of COVID-19 and the government initiatives introduced to help.
Distilling down the information available into helpful guidance, after new changes and measures were announced by the government on March 18th, Ian wanted to help give his clients a clearer picture of where they stand, and the help available to them.
With little detail available on the topic, we wanted to extend Ian’s quality advice to all our members.
The current assistance now being offer by the government is as follows:
All businesses within the Retail, Leisure and Hospitality Industry will now have no Business Rates to pay for a period of 12 months. These changes should happen automatically, and your local authority should contact you in due course, with amended Rates calculations for the year. If you pay by Standing Order and you fall into this category, please cancel them immediately. If you are unsure if you fall into this category, speak to your local authority and they will be able to advise you further.
All businesses within the Retail, Leisure and Hospitality Industry, with a rateable value of between £15,000 and £51,000, will be entitled to grant funding of £25,000. This, we believe, will be a direct cash payment from your local authority, and will not be repayable. We understand that this will need to be applied for, and full details of how you go about claiming this should be released by 20th March 2020.
All businesses, regardless of industry sector, that currently pay little or no Business Rates because they are claiming Small Business Rates Relief, will be provided with a one-off grant of £10,000. The guidance on this suggests that if you qualify, you will be contacted by your local authority, without requiring you to apply. Currently, there are no timescales that we can see. I would suggest, if you want some certainty, to speak to your local authority over the coming days to determine whether or not you qualify for this.
Business Interruption Loans
The Coronavirus Business Interruption Loan Scheme was introduced to support long-term viable businesses, who may need additional assistance to respond to cash-flow pressures. Last we heard; this was due to launch in a ‘matter of weeks.’
These will be loans largely guaranteed by government, and the thinking is, that this gives those lenders signed up to it, greater financial certainty. They appear to be throwing a lot of money behind it now, so we expect them to be pretty widespread. Your bank manager may be the best place to start on this.
Our best guess is that if you are a viable business outside of the current situation, then you have a good chance of having a successful application. If you haven’t done so already, I would recommend you assess your cash-flow, and determine how much you may need to see you through to a time where trading returns to normal level, and beyond.
One small piece of information we do now have on Business Interruption Loans, is that the first six months will be interest free. As for rates and repayment terms etc, we’re still in the dark. We expect that full information on this will be available in the middle of next week at the latest.
Mortgage Repayment Holidays
It was announced yesterday that mortgage repayment holidays are an option. Again, details are sketchy to say the least.
There is going to be a fast-track system in place for approval, but not everyone is going to be granted one. Mortgage repayment holidays are aimed at people in ‘financial difficulty.’ What the definition of that is, is anyone’s guess at the moment. However, I would suggest that you speak to your lender if you feel you are going to struggle financially, and take it from there.
Based on the information available to us, we understand that this measure is only for individuals with residential mortgages.
If you are currently facing periods where you are going to be receiving little or no income, it might now be time to consider applying for Universal Credit.
We’re unfortunately not experts in this, and can’t offer any real advice here regarding if you would be eligible, or how much you would be eligible to receive, though this link should help you do just that,
Should you need any figures from us when making an application, don’t hesitate to contact us by email and we will try our best to get back to you as quickly as possible.
IR35 & Freelance Contractors
This is potentially a big one for a lot of you out there.
Many of you will have been faced with the prospect of moving on to a new way of paying tax as of 1st April 2020 and are to be taxed as if you are an employee. Many of you will know this as IR35.
It was announced last night that the implementation of this is now to be delayed to 1 April 2021.
What this may mean in practise is hard to say. With it being so close to the original implementation date, there’s every chance that Companies will just apply it anyway, as the infrastructure is all in place now.
That said, it is absolutely worth speaking to whomever you contract with, or the agency you work through, to raise this as an issue, to see if you can just go back to how it was.
Business Disruption Insurance – Hospitality Trade
There was much talk on social media of the government’s announcement on Monday, recommending the public avoid pubs, bars, restaurants etc, providing no guidelines or support for these businesses and largely throwing the industry under a bus, with no option for them to make an insurance claim.
It was announced last night that, that as long as your insurance covered you for Pandemic or Government-ordered closure, you should be able to make a claim still.
That said, it is believed that most businesses were never covered for this in the first place. All I can suggest here, is to check your policy and speak to your provider to see where you stand.
Brass Tax Matters
We are still very much open for business, and should we go in to a full lockdown, will be working from home (in what capacity depends on how much our kids pester us!!).
There is, understandably, a bit of a panic amongst a lot of small business owners. Our thoughts are to try not to panic, speak to us about your concerns, access all the government assistance that is being made available, and buy yourselves as much time as possible to come to the right decision in a rational way.
We are trying to answer all your questions as quickly as possible. The scale of requests for assistance or answers is like nothing we’ve seen before, so please do bear with us. If you need something, please email if you can. That way we at least have a list of queries we can work through methodically.
Whilst we are able, we are here for each and every one of you during what is no doubt a very stressful time, and believe me, whatever stresses you’re having about your own business, we are having the same ones about ours. We are through the looking glass here folks!!
Thanks again to Ian and Brass Tax, and if we can answer any questions regarding co-working in light of the current outbreak, don’t hesitate to ask a Wizu Community Manager or any of our helpful staff. We’re here to support you.
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