Covid Support: End to most measures

24th September 2021

When COVID directly impacted upon the UK in Spring 2020, the Government introduced a range of measures specifically targeted to help SME businesses survive the expected period of financial strain. Such businesses should now be planning ahead for when this support is gradually withdrawn:

21-Jun-21

  • Deadline for arranging with HMRC when to repay COVID related (ie between 20-Mar-20 and 30-Jun-20) deferred VAT.

30-Jun-21

  • End of period of statutory relief from wrongful (ie insolvent) trading claims possibly being made against a director personally.
  • 100% business rates relief for retail, hospitality and leisure businesses reduces to 67% relief.
  • Government furlough wages subsidy reducing from 80% to 70%.

30-Sep-21

  • End of moratorium for creditors being able to file:
    • Statutory demands.
    • Winding up petitions.
  • End of furlough wage subsidies scheme.
  • Temporarily 5% reduced VAT rate for hospitality and tourism to increase to 12.5%.
  • Deadline for claiming the 5th, and final, SEISS support grant for the self-employed (covering the period May-21 to Sep-21).
  • End of Coronavirus SSP rebate scheme.

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – 

31-Dec-21

  • Government backed Recovery Loan Scheme ends.

25-Mar-22

  • End of moratorium on landlords evicting commercial tenants.

31-Mar-22

  • 67% business rates relief for retail, hospitality and leisure businesses ends.
  • Removal of £10,000 temporary debt threshold required for a winding up petition.
  • Ending of debtor business giving creditors 21 days for a response before they can proceed with winding up action.
  • End of business loss tax relief 3 year carry back rule (reverts back to 1 year).

30-Apr-22

  • Temporarily 12.5% reduced VAT rate for hospitality and tourism to end.

Also during this time, businesses that applied for COVID related bank loans (CBILS & BBLS) are going to have to start making repayments once the initial repayment holiday period ends.

 

Even after Government support, COVID has been a mixed bag for businesses.  Most have struggled on, with suppressed results, and often with more (cheap) debt. But we have also seen:

  • More owner exits, through voluntary liquidation or an early retirement related trade sale (particularly to take advantage of the generous ER rate of CGT which many think might be short-lived and the ability to take advantage of the currently vibrant private equity market),
  • Businesses going bust,
  • Some taking advantage of new market opportunities and thriving,
  • Some individuals who were laid off now taking the leap of faith to start their own business.

As always with running a business, the best entrepreneurs will now once again be planning for how to navigate the challenges ahead and preserve their cashflow, as the remaining support measures end.

 

Blog entry by: Ian Piper

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