Coronavirus (COVID-19): Summary of financial support for businesses | Corporate and Commercial law
A useful summary of the current support available for businesses experiencing increases in costs or financial disruptions because of Covid-19 has been produced by Thursfields Solicitors.
The guidance follows the recent economic downturn which means especially small and medium sized enterprises (SMEs) will need as much financial support as possible.
Philip Chapman, Corporate Director at Thursfields Solicitors, said: “The Chancellor is making an initial £330 billion of guarantees available, which includes unlimited loans and guarantees to help businesses manage cash flow.
Further measures include providing support for liquidity amongst large firms with a new scheme being launched by the Bank of England to help them bridge Coronavirus disruption to their cashflows through loans.
The government is also increasing the amount businesses can borrow through the Coronavirus Business Interruption Loan Scheme from £1.2 million to £5 million.
Businesses can access the first six months of that finance interest free, as the government will cover interest in that period.
Furthermore, new legal powers in the Covid Bill will enable the government to offer further financial support.”
Philip explained that further unprecedented actions include £20 billion of business rates support and grant funding to help businesses manage their cash flow. This includes:
- giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months;
- increasing grants to small businesses eligible for Small Business Rate Relief from £3,000 to £10,000; and
- providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000.
Philip added: “Businesses and individuals are encouraged to speak to their banks as the government said mortgage lenders have agreed to support customers experiencing issues with their finances as a result of Covid-19, including payment holidays of up to three months.
Importantly, the government has confirmed that its advice to avoid venues like pubs, clubs and theatres is sufficient for businesses to claim on their insurance where appropriate business interruption cover for pandemics is in place.
The action announced on 17 March also means that over £3.5 billion in additional funding will be provided to the devolved administrations for support to businesses in Scotland, Wales and Northern Ireland.”
For further information or business advice, contact Philip Chapman on 0121 227 3879 or at email@example.com.