1. Spending Measures (Budget Allocations)
a) Budget 2020 included a new £5 billion COVID-19 Response Fund, to provide any extra resources needed by the NHS and other public services to tackle the virus.
2. Tax Measures (Deferral of Payroll Tax Obligations, Extensions of Tax Filing Deadlines)
a) VAT payments due between 30 March – 30 June may be deferred for 3 months
b) Self-assessment payments due by 31 July 2020 may be deferred until January 2021
c) Deferment of self-assessment payments on account until January 2021
3. Subsidies to Preserve Jobs, Employee Benefits, Food Assistance
a) Job retention scheme: employers can claim for 80% of furloughed employees (employees on a leave of absence that otherwise would have been made redundant), up to £2,500 per month
b) Employers with fewer than 250 employees can reclaim 2 weeks’ statutory sick pay (currently at £94.25 per week) for sickness absence due to COVID-19
c) 100% business rates holiday for the next 12 months for retail, hospitality and leisure businesses
d) Business rates holiday for nurseries for 2020-2021 tax year
e) Grants increased for small businesses from £3,000 to £10,000
f) Grants of £25,000 available to retail, hospitality and leisure businesses operating from smaller premises with a ratable value between £15,000 and £51,000
g) Self-employment income support scheme to allow self-employed to claim taxable grant worth 80% of trading profits up to £2,500 per month for 3 months
4. Public Loan Guarantees and Expansion of Loans to Businesses
a) Coronavirus business interruption loan scheme for smaller businesses providing access to loans, overdrafts, invoice finance and asset finance of up to £5 million for up to 6 years
b) Short term debt available under COVID-19 corporate financing facility to support large investment grade businesses, to operate for 12 months and “for as long as steps are needed to relieve cash flow pressures”
5. Student Loan Relief
a) The UK Student Loan Company has confirmed that students will receive their scheduled or next instalment of their maintenance loan at the planned start of their summer term, regardless of whether their university or provider has made alternative arrangements for teaching.
6. Insolvency Law Relief
1. Reduction of Interest Rates
a) Bank of England has cut their interest rate to 0.1%.
2. Expansion of Central Bank’s Holdings of Government Bonds
a) The government has brought in a ban on evictions for commercial tenants who are unable to pay their rent, meaning that no business will automatically forfeit their lease and be forced out of their premises if they miss a payment up until 30 June.
b) From 26 March 2020, landlords will be required to give their tenants 3 months’ notice if they intend to seek possession, to apply until 30 September 2020.
3. Other Measures to Support Flow of Credit
a) Although not yet implemented, the finance chancellor has announced that the UK government will potentially be suspending mortgage payments for up to 3 months during COVID-19.
4. Suspension of Foreclosures/Evictions
5. Reductions/Suspensions of Mortgage Payments
6. Asset Purchases (Liquidity Facilities, Purchase of Private and Public Sector Securities, Acquiring Equity of Larger Affected Companies)
7. Exchange Rate Adjustments
1. Social Distancing
a) UK Government-enforced lockdown. Under these new measures, the Government requirements for the public are to stay inside and only go outside for food, health reasons or work (if not able to work from home). People must stay 2 metres away from other people outside the household at all times.
2. Closure of Public Places for Gathering
a) The Government has closed schools, pubs, restaurants, cafes, gyms and other businesses.
b) The Government has put in place the Coronavirus Act, empowering the relevant authorities to prohibit or restrict events and gatherings, and to close premises.
3. Closure of Non-Essential Businesses
a) Changes have been made to the Care Act 2014 to help local authorities prioritize care and support during the outbreak.
b) The Government has put in place the Coronavirus Act, enabling them to respond to the current emergency and manage the effects of the pandemic, including the emergency registration of health professionals, temporary registration of social workers.
4. School Closures
The European Union has introduced a temporary framework for state aid measures to help businesses get access to the liquidity and financial support required to survive the outbreak, in the form of grants, loans and guarantees.
1) Proposed Changes to the UK Insolvency Framework – the UK Government is looking to introduce:
a) Moratorium for companies to provide them with breathing space from creditors whilst seeking rescue/restructure
b) Protection of supplies to enable to continue trading during moratorium
c) New restructuring plan, binding creditors
2) Temporary suspension of wrongful trading regime (removing personal liability for directors) retrospective from 1 March