UK lockdown: updates to financial support
Image credit: Christin Hume 📸
Updated: 6th January 2021
As the third lockdown begins, existing support measures are being extended to help people through the next few months. To help you to navigate your way through the piles of information, we’ve created a summary of the latest updates to each of the support schemes. We’ll cover:
- Grants for the retail, hospitality and leisure sectors [New]
- Self-employed income support scheme (SEISS) [Update]
- Business loans
- Furlough scheme
- Mortgage holidays
- Universal credit
As things change we’ll keep this blog up to date.
Business grants for the retail, hospitality and leisure sectors
One-off top-up grants will be offered to businesses – that are closed – within the hospitality, retail and leisure sectors and will vary from £4,000-£9,000. It’s important to note that how much you are eligible to receive will depend on the rateable value of your business.
Not sure what a rateable value is? It’s defined as “the value assigned to non-domestic premises by the Valuation Office Agency (VOA), and is based on a property’s annual market rent, its size and usage”. The VOA reviews these every five years and it often influences some of the business rates that you pay (if you have a premises). If you need to find out what the rateable value of your business is, head to the UK Gov website to double-check.
Below, you can see how much you may be able to claim:
- £4,000 for businesses with a rateable value of £15,000 or under
- £6,000 for businesses with a rateable value between £15,000 and £51,000
- £9,000 for businesses with a rateable value of over £51,000
Any business that is legally required to close, and cannot operate effectively remotely, is eligible for a grant. You will need to contact your local council for more information.
As more information is released we will update you on additional requirements.
Self Employment Income Support Scheme (SEISS)
The SEISS was originally extended through to January covering 40% of average trading profits. In November, this increased to 80% for November, December and January. This means that the maximum grant size is £7,500. There’s more information on the specifics on the UK Gov website and the deadline for the 3rd claim is the 29th of January 2021.
You can claim this grant even if you haven’t claimed either of the first two. However, the eligibility for the 3rd grant is slightly different from the first two, so please make sure that you check the criteria.
Remember, you need to declare that your business has been impacted by Covid-19 and that you intend to continue trading (where possible).
Update: The government has announced that there will be a 4th SEISS grant – that will cover February to April 2021 – but the details are yet to be revealed. We will continue to update this section as more information becomes available.
If you were looking for a business support loan due to Covid-19, the application deadline was also extended back in November.
You have until 31st March 2021 to apply for a Bounce Back Loan (BBLS) or the Coronavirus Business Interruption Loan (CBILS).
If you’ve already taken a Bounce Back loan and borrowed less than 25% of your turnover (up to £50,000), you can apply for a top-up under the new rules.
It’s important to note – you can only top-up your loan once.
The furlough scheme was extended for UK small business employees (this includes sole director companies) back in November.
The extended scheme is running until the end of April 2021 and will continue to cover 80% of an employee’s salary, up to a maximum of £2,500 for the hours not worked.
You’ll only be asked to cover national insurance and employer pension contributions which, for the average claim, accounts for just 5% of the total cost.
The mortgage holiday period was due to end 31st October, however, this was extended in November and you can apply until the 31st March 2021.
If you haven’t taken one, you can still apply and will be entitled for a payment holiday of up to 6 months in total. If you have already taken a payment holiday, you’ll be able to top this up for a further 6 months without it affecting your credit rating.
The minimum income floor (MIF) suspension was due to end in November 2020, but the DWP confirmed that the suspension will continue until April 2021. This is good as many have been left out from schemes like SEISS and have had to rely on things like universal credit to get by. Without this extension, many people would have had a huge drop in the financial support that they receive.
Looking for more info?
If you’d like to know more of the nitty-gritty, then we recommend you take a look at this article by Money Saving Expert which covers many of the changes that have happened in more detail. They’ve covered many of the same topics that we have, but this article drills down into the finer details of some of the schemes and how you can apply.
We also know that things can be stressful in times of uncertainty, so if you do have any questions or concerns feel free to get in touch with us on Coconut Bite, message us in the in-app chat, or drop us an email at [email protected].