It is inevitable that most business will be impacted by the Covid-19 pandemic. This is unprecedented in my time in practice, and I believe the impact may be far greater than the 2008 financial crisis.
As well as the human cost to health and emotional well being, many businesses will suffer financial losses.
If your cashflow has been impacted, or is likely to be impacted, there are a measures that you can take.
Speak to your lenders about a payment holiday
Banks have been encouraged by the government to support small businesses. Your lender should be sympathetic, given the circumstances.
Speak to your creditors about deferring payment
Your creditors may agree longer payment terms. However if they are a small business, they may be in the same position as you, and may not be able to support you.
Apply under Coronavirus Business Interruption Loan Scheme’ (CBILS)
Last week, the Chancellor announced a government backed loan scheme. Businesses apply to one of 40 lenders for loans or asset finance from £1,000 to £1.2m.
This scheme guarantees 80% of the debts to the lender, and it should be easier to get finance under this scheme.
See https://www.british-business-bank.co.uk/ourpartners/supporting-business-loans-enterprise-finance-guarantee/efg-for-advisors-smes/ on how to apply.
Revenue’s ‘time to pay’ tax suspension
If you are struggling to pay tax bills you can ask HM Revenue & Customs for a “time to pay” agreement which would suspend debt collection. Each agreement is negotiated on an individual basis through a dedicated hotline. During the coronavirus outbreak the usual 3.5 per cent annual interest on deferred tax payments will be waived. It will be important to get upfront agreement from HMRC before a payment deadline.”
This link will guide on what to do next. https://www.gov.uk/difficulties-paying-hmrc
Apply for the Government £3,000 coronavirus grant
If you are already exempt from business rates, you are eligible for £3,000 of grants to help meet business costs. This was announced in last week’s budget. However, we have not had guidance on how businesses can access this grant. As soon as we get more information, we will update this website.