As we begin a new year, we also approach one year of coronavirus in the UK.
While Christmas provided some much-needed respite for many families, baubles were taken down alongside hope of a more ‘normal’ start to the year as a third national lockdown was announced.
Yet, for the first time in this pandemic, the end is in sight.
The nation is jabbing its way back to normality as Boris Johnson announced that pedals were to the metal for 13 million of the UK’s most vulnerable people to be vaccinated over the next few weeks.
Unfortunately, the order to stay at home and close certain businesses will have a fiscal impact on firms that have already had to sacrifice so much over the last 12 months.
It is for that reason that Chancellor Rishi Sunak announced a further £4.6bn of funding for struggling businesses to help see them through to a more stable springtime.
The businesses eligible
Sunak announced that this new funding package is available to businesses in retail, hospitality and leisure that have had to close due to new lockdown restrictions.
These businesses, including our favourite restaurants, cafes and gyms, have endured a yo-yo year of opening and closing as the government tried to minimise both the health and financial impacts of the pandemic.
Sectors such as tourism and travel were less than impressed with the support offered to them in 2020 as restrictions wiped out bookings.
Businesses in these industries will be hoping that this financial support will take them to a summer much closer to ‘business as usual’.
Other types of businesses affected by the new lockdown will also be supported by a new ‘discretionary fund’.
The support available
Businesses in the UK who operate in those sectors will receive one-off grants of up to £9,000 per business premises. An estimated 600,000 premises are expected to benefit, costing the government £4bn.
The grants to closed businesses will equate to £4,000 for premises with a rateable value of £15,000 or under, £6,000 for those worth between £15,000 and £51,000 and £9,000 for properties valued at over £51,000.
The discretionary fund offers £594m to other businesses not in these sectors that may have felt the impact of new restrictions.
This new package will work in tandem with the extension of the furlough scheme until April and the £3,000 per month closed businesses can already receive from the Local Restrictions Support Grant.
What it means for you
Some businesses in the retail, hospitality and leisure sector may have questioned their chances of surviving a third lockdown.
But a one-off cash grant that increases for higher-rated premises should go quite some way towards helping these businesses on what they hope will be the final stretch.
By furloughing staff, taking advantage of the current monthly grant scheme and applying for one of the new one-off grants, some of the businesses affected will be able to survive the latest restrictions before Sunak’s March Budget hopefully reveals long-term support for financially scarred firms.
However, many businesses will also be expecting an extension to the business rates holiday and of the 5% VAT rate.
Sunak is yet to confirm these extensions and may not do so until the March Budget. Our advice would be to take advantage of the support he has confirmed until then.
How can we help you?
KBL will continue to support you and your finances on what we hope will be one last push towards a return to normality.