Non-essential loans

Dave Jangid | Online Account Filing By Dave Jangid |
Non-essential loans | Online Account Filing

Rishi Sunak announced a £5bn scheme for High Street shops and hospitality firms in England on new Covid grants, Restart loans, and
dates in the Spring Budget.

As we all know and wait with bated breath, non-essential shops along with outdoor hospitality (yes pubs), will be allowed to reopen from 12th April at the earliest, yet due to the COVID-19 crisis, the closure of all non-essential, retails and hospitality (restaurants, yes pubs again, hotels, other accommodation) has led to limitations in the operations of thousands of other businesses. However, to help small businesses and income support for those missing out somewhere, e.g., limited company directors and self-employed the government has rolled out a new financial package for companies, covering the most of high street.

The chancellor also mentioned that once England eases the lockdown the new £5bn grant scheme worth £18,000 per firm, will facilitate them to reopen their businesses again.

As Sunak’s priority is still jobs and firms, he said that public finances faced “enormous strains due to the COVID-19” but he wants to level with people about the challenges they faced.

rishi-sunak-budget-2021

Restart Grants

The restart grant scheme will replace the current monthly grant scheme that ends by 31st March and the new grant scheme will be made available from April.

The scheme focuses on helping the retails, hospitality, accommodation, personal care (barber shops, nail salons, beauty centers), and leisure to boost their income while reopening their businesses. A whopping number of 700,000 hotels, shops, restaurants, pubs, hair salons, gyms, and other businesses, will now be eligible for the “Restart Grants”, and be distributed directly by the local authorities.

  1. The Restart Grant will be made available to hospitality firms that are re-opening outdoor areas from mid-April if they are ratepayers.
  2. Grants up to £6,000, will be received to non-essential businesses like sports facilities, tourism. It may also include companies that run mainly as in-person premises but who have been forced to shut down these facilities and now offer a takeaway operation, which will open earlier as part of the roadmap to recovery. While hospitality, close contact services, and other leisure businesses which include personal care, hairdressers, and gyms that are assumed to open later will receive grants up to £18,000.

    Also, businesses that are not eligible for a restart grant can take advantage of the Additional Restrictions Grant.

Government-backed loans

Government-backed loans | Online Account Filing

On 6th April, a new recovery loan scheme will be introduced that will run till 31st December. It replaces the existing government guaranteed schemes that will be closed at the end of March. The new scheme is aimed to help access funding for UK businesses as they expand and recover from the uncertainty that the COVID-19 pandemic creates. It replaces the

These loan schemes had to end at the end of January 2021, but they got extended until 31 st March.

On 31st March applications for Bounce Back loans will close.

Who can apply for the Recovery Loan Scheme and how

Who can apply for the Recovery Loan Scheme and how

The information on the new government-backed “recovery loan” has been summarised as below:

CriteriaEligibility
Beneficiaries of bounce back loanYes
Loans and overdraftsFrom £25,000 to £10m
Asset/invoice based financeFrom £1,000 to £10m
Unsecured financeUpto £250,000
Tenure for loans and asset financeUpto 6 years
Tenure for overdrafts and invoice financeUpto 3 years
Restriction on utilisation of fundsCan be used for any ‘legitimate business purpose’- as business capital, however, it is still to be reviewed if the funds from the loan can be used to directly support the income of sole traders or limited company directors.

VAT

As VAT for hospitality, hotels, holiday accommodation, and admission to certain attractions had temporarily reduced to 5% will now be extended for 6 months till the end of September, with a 12.5% interim rate for more than 6 months after that. Click here to find out more about the previous VAT Cut for Leisure Industry.

In order to aid and manage the cash flow of businesses payment on VAT between 20th March and 30th June 2020 had been deferred. But the amount is now due in full on or before 31st March 2021. There is an alternative with the new VAT deferral new payment scheme. From 23 February the online opt-in process opened up to and including 21 June 2021. Instead of paying the entire sum by the end of March 2021, businesses can make up to 11 smaller monthly installments free of interest. Both installments must be paid by the end of March 2022.

BUSINESS RATES

Shops,

pubs, restaurants, café,

cinema/ live music venue,

assembly leisure property,

hospitality property- a guest house, hotel/ self-catering accommodation

Nursery on Ofsted’s Early Years Register

Nursery providing care and education for children up to 5 years old (early years foundation stage)

For the year 2020 to 2021 tax year, the businesses in retail, hospitality, and leisure sectors and early years nurseries in England were relieved from paying the business rates, which ends on 5th April 2021. In the Spring Budget, the Chancellor declared a three-month expansion of the Business Rate Holiday until the end of June before switching to a two-thirds discount for the rest of the year.

Dave Jangid | Online Account Filing By Dave Jangid |
Note: Please note that the content of the above blog and the aforementioned information are solely for the purpose of awareness and are informative in nature. The content is designed with intent to ease the understanding while preserving the essence and importance of the compliance rules and shall not be considered as an ultimate replication of the rules. Online Account Filing does not own any responsibility whatsoever for any unpleasant event that may arise due to the misinterpretation of a specific part or whole of the information.

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