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On Friday the Chancellor announced a HMRC-administered coronavirus jobs retention scheme to help businesses survive and cushion the economic blow of COVID-19.

As he joined the Prime Minister on Friday evening, Rishi Sunak also announced that VAT and self-assessment tax payments will be delayed.

Coronavirus Job Retention Scheme

Under the new job retention scheme employers can contact HMRC for a grant to cover 80 per cent of wages of people who are not working but are retained on payroll, rather than being laid off. Employers will get a maximum of £2,500 pcm per employee. To fit in with emergency cash flow needs, the first grants will be paid in a matter of weeks, and at the latest before the end of April.

Any employer in the country, of any size, and charitable organisations as well as not-for-profit organisations, can apply
The Scheme will be backdated until 1st March 2020, and available for at least three months. The Chancellor confirmed that this period will be extended if required, and that unlimited funding will be made available for the scheme.

Coronavirus Business Interruption Scheme

The earlier announced “Coronavirus Business Interruption Loan Scheme” (CBILS) whereby the Government will guarantee up to 80% of the value (up to £5m) of loans introduced, will now be interest free for 12 months and will be available from Monday.

The Chancellor advised that more measures will be announced next week to ensure that medium and larger businesses can also access CBILS.

Deferral of VAT Payments

To bring even more rapid cash flow relief to businesses, Sunak announced a VAT holiday from now to June. This means the next VAT quarter payment (Jan to March) is deferred until the end of June 2020, which in real terms means that VAT incurred during this period will not be payable until the end of the 20/21 financial year (05 April 2021).

The Chancellor said this deferral is a “direct injection of £30bn of cash to employers, equivalent of 1.5% GDP”. Apparently this is an automatic offer with no applications required. You will simply not need to make a VAT payment during this period.
All businesses will gain a much needed cash flow boost from this deferment which will help you through the coming months. But remember that this is a delay not an exemption.

Cash grants for retail, hospitality and leisure businesses

In addition to the business rates holiday, we understand that a number of local authorities are providing additional cash flow support to businesses in the retail, hospitality and leisure sectors. These cash grants amount to up to £25,000 per property.

You don’t need to do anything to access this scheme, your local authority will write to you if you are eligible. Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.

Support for small businesses

For businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) or tapered relief, there is a one-off cash grant of £10,000 available. This will help eligible businesses meet their ongoing business costs.

You don’t need to do anything to access this scheme, your local authority will write to you if you are eligible. Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.

Self-employed support


Whilst employers have had the lion’s share of the support so far, Sunak has also delayed the next round of self-assessment payments. Originally scheduled for 31 July this year, they are now being pushed back to January 2021.

Previous Announcements


This is second time, and probably not the last, that Sunak has appeared at the Prime Minister’s daily coronavirus press conference. In his first showing, The Chancellor pledged a £330bn rescue package to support businesses through the economic impact caused by the virus. This included postponement of the April 2020 IR35 (off-payroll working) rules in the private sector until 2021, an interest rate reduction and a 12-month business rates holiday for all businesses in the retail, hospitality and leisure sectors.

Full guidance

Detailed guidance about the full support package for employers, businesses and employees is available at:
COVID-19: support for businesses – Including support for paying tax, supporting larger companies through buying short-term debt, advice on claiming insurance
COVID-19: guidance for employees – Including support for rent costs, support for the self-employed, sick pay and staying at home

We will continue to share the most up to date information directly with you as it becomes available. Get in touch if you need advice