Things To Remember In 2021, If You’ve Utilised The Covid-19 Business Measures
Wouldn’t it be lovely, for most of us, to have 2020 rubbed off from the calendar! Can we all do a re-take of 2020? Enough dreaming and let’s be realistic!
So, what happened in 2020? We got run over by COVID -19, pretty much from the start of the year. The government offered various grants and loans to keep businesses ticking along during the pandemic which has no sight of slowing down.
Almost all small business took advantage of Bounce Bank Loan (BBL) offered by the banks. High street banks started offering BBL from around late April. BBL’s were offered with 12 months interest free and no repayments. If you are one of the businesses who took advantage of the offer and borrowed money, then the chances are you will have to start repayments in 2021. This might be an issue if your business has not started trading as normal. However, if you are trading as normal you must start putting money away in order to meet the repayment requirements. It is uncertain at present, what plans the government has for businesses struggling well into the second half of 2021.
Similar to BBL help for small businesses, medium size enterprises and self-employed were eligible to apply for Coronavirus Business Interruption Loan (CBIL) of up to £5 Million. The government paid and will pay 12 months interest. Businesses should factor in interest payments, in addition to the repayments, in 2021.
Some business took advantage of deferring the payment of VAT liability for quarter ended 30.06.2020. This will be payable on or before 31 March 2021.
Local council offered business rates holiday for retail, hospitality and leisure sector. This holiday is likely to end at the end of the tax year 2020/21. This means you may have to start paying business rates from April 2021. Business should factor in business rates payments for 2021.
Looking to increase your team in 2021? Government introduced Kickstart Scheme to support create job placements. The Kick Start Scheme gives business financial support to create new 6-month job placements. The catch is that each application is for a minimum of 30 placements. The good news is you can partner with other organisations if you have fewer than 30.
HMRC offered Time To Pay service for business that cannot pay tax bill on time because of Coronavirus. HMRC allowed businesses to delay paying their outstanding tax liabilities without penalty. If your business has taken advantage of this you will need to plan for making payments in 2021.
All of the above will require a certain degree of planning and ascertaining your cashflow requirements for 2021. Why not prepare a cashflow forecast for 2021? You may have never done a cashflow before - it’s never too late to start now, as there is so much going on at present which requires detailed planning for 2021.
The Coronavirus Job Retention Scheme started in March 2020 and now extended to potentially March 2021. HMRC will start checking your claims and likely to start inquiries in 2021 if not already contacted you. It is best to have your claim details ready in case HMRC do contact you.
Businesses should review their requirements with regards to having large office spaces and having all staff in premises at all times, pre pandemic levels. You will need to ask the question, is it necessary to have everyone in the office at all times? One thing the pandemic has taught us is that you don’t have to be in an office to do certain types of jobs. People have successfully worked from home in 2020. Business should review their office space requirements and downsize if possible, saving on rent!
If you need any further advice, please don't hesitate to get in touch with us today.