I recently asked some questions in parliament about Coronavirus assistance for small businesses, clarity on furloughing staff, assistance for self-employed people and the Coronavirus Business Interruption Loan Scheme (CBILS).
These questions were written on behalf of the many constituents who have been in touch with me recently to ask about these issues.
I received the written answers to these questions today. They might provide some clarity for people in these situations.
If you need any further information, please see the Coronavirus Information section of my website.
What support is available for small businesses that are run from home so they do not pay business rates and therefore don’t qualify for the £10k grant?
Small businesses which are awaiting payments under the Coronavirus Job Retention Scheme, and which are ineligible for the grants schemes, can access finance under the Coronavirus Business Interruption Loan Scheme (CBILS).
The CBILS has recently been expanded to include all small businesses affected by coronavirus, regardless of whether they would be able to access financial support on commercial terms.
Can a former employer take on a person after they have left in all cases, whether they left as a redundancy or left of their own accord?
Yes, this is made clear in the updated guidance. If the employer made employees redundant, or they stopped working for you on or after 28 February 2020, you can re-employ them, put them on furlough and claim for their wages through the scheme.
Has consideration been given to include all self-employed people in the scheme but making support for those with profits above £50,000 recoverable through the tax system?
- Self-employed trading profits must be less than £50,000, with more than half of their income from self-employment. This ensures it is targeted at those who need it the most and are most reliant on their self-employment income.
- 95% of people who receive the majority of their income from self-employment will be eligible for this scheme. The self-employed population is very diverse, with some earning significant profits.
- Not all those in self-employment will need extra support: the average income of those who earned more than £50,000 in 18/19 was more than £200,000. It is not right for the government to be giving money to such individuals.
- Those with average profits above £50,000 could still benefit from other support. The SEISS supplements the significant support already announced for UK businesses, including the Coronavirus Business Interruption Loan Scheme and the deferral of tax payments. More information about the full range of business support measures is available at www.businesssupport.gov.uk/coronavirus-business-support/
I am a small business and my bank is not offering CBILS, but instead they are increasing overdrafts or selling me their own commercial loans and charging interest on both. What support is available for me?
The government has been working with the financial services sector to ensure that companies feel the full benefits from this scheme.
On 3 April, the scheme was extended so that all viable small businesses affected by coronavirus, and not just those viable businesses unable to secure regular commercial financing, are now eligible if the lender believes they will need finance to see them through these unprecedented times.
This exceptional support is designed to enable all long-term viable businesses experiencing difficulties as a result of the coronavirus outbreak to access finance, if external finance is the right answer.