hospitality business during Covid-19
For more information, follow the link below.
Check you are getting your £4,000 small business relief on NI contributions – you have to apply for it, but if your NI contributions are less than £100,000 then you are entitled to it. You can ask your payroll/accountant to check this. This was increased from £3,000 in the Budget.
Delivered by accredited lenders, Bounce Back Loans target small and micro businesses in all sectors, providing loans from £2k up to 25% of the business’ turnover, with a maximum loan of £50k. This scheme replaces the initial CIBILS scheme (Corona Virus Business interruption loan scheme) for loans up to £50k and where you haven’t yet completed on your CIBILS loan.
This new and updated scheme is a far simpler, easier way to get access to funds - providing lenders with a 100% government-backed guarantee and standardising the application form is expected to lead to loans becoming available within a few days.
Scheme features
The Bounce Back Loans Scheme enables businesses to obtain a six-year term loan at a government set interest rate of 2.5% a year. The government will cover interest payable in the first year.
• Up to £50,000 loan: Loans will be from £2,000 up to 25% of a business’ turnover or £50,000, whichever is lower.
• 100% guarantee: The scheme provides the lender with a government-backed, full guarantee (100%) against the outstanding facility balance, both capital and interest. The borrower always remains 100% liable for the debt.
• Interest rate: The government has set the interest rate for this facility at 2.5% per annum, meaning businesses will all benefit from the same, low rate of interest.
• Interest paid by government for 12 months: The government will make a Business Interruption Payment to the lenders to cover the first 12 months of interest payable, so businesses will benefit from no upfront costs.
• No principal repayments for first 12 months: Borrowers will not have to begin principal repayments for the first 12 months, thereafter capital will be repaid on a straight line basis.
• No guarantee fee for businesses or lenders to access the scheme
• Finance terms: The length of the loan is for six years but early repayment is allowed, without early repayment fees.
• No personal guarantees: No personal guarantees are allowed, and no recovery action can be taken over a principal private residence or principal private vehicle.
OTHER BUSINESS FINANCE SUPPORT OPTIONS
You can also find details of other government measures to support public services, people and businesses through this disruption on the Government’s Business Support website which you can locate to by clicking here.
Sky have announced that they’re suspending payments as of 14th March. BT are apparently doing the same but currently no link to that statement.
Ask to negotiate payment terms and keep them in the loop about when payments will be made.
Ask to negotiate payment terms and keep them in the loop about when payments will be made.
Several companies have also launched funds to support businesses through the next few months.
It’s a bit inconvenient for a short period whilst you adjust your direct debits etc. but can save on bank fees.
Some staff will be less affected by the reduction in pay, for example, those living with parents. Ask for volunteers to have their hours reduced before doing it unilaterally.
Communicate your sickness policy very clearly to them. Remember that SSP now applies from day 1 of illness, and if you employ less than 250 people then the government will cover it.
If you can afford it, consider using staff for jobs outside of their usual roles.
If one of your staff is an aspiring photographer, then use them to build your social media asset bank
If they have cars and you’re launching, or currently do, deliveries then consider using them as delivery drivers.
The above are just a couple of ideas, but I can imagine they’ll be open to a short-term change of roles if it means keeping their job.
As you will all be aware by now the govt has launched the Job Retention Scheme. You can claim up to 80% of the salary of elgible staff back as long as they are furloughed. Full details available here
Remember that workers cannot undertake any work for you whilst furloughed!
If you'd like to read some tips on how to survive the Covid-19 pandemic as an employee, follow the link below.
Views expressed by individual/government contribution on this information hub may not necessarily reflect the views of SPARK, NEW APEX LTD.
