Knowledge hub  > Covid-19 update​

Covid-19 update

What funding support is available for businesses

We want to make sure every single business knows where to go right now to help them through the challenges caused by coronavirus. We might not be able to advise, but we can point you in the right direction.

  • The Coronavirus job retention scheme was due to come to an end on 31 March 2021 but has now been extended until 30 September 2021. The extended scheme will cover 80% of furloughed worker’s income up to £2,500 a month for May and June 2021. From July 2021 the contributions paid by the Government will reduce to 70% of normal pay limited to £2,187.50 per month. Employers will also be required to pay a 10% contribution to wages from this date up to £312.50 per month. The employee will therefore still receive 80% of their normal pay up to £2,500 per month. The contribution paid by the Government will reduce to 60% of normal pay for August and September 2021 limited to £1,875 per month. The employer will also be required to pay a 20% contribution up to a maximum of £625 per month. Flexi-furlough will continue to be an option, so employees can work part-time and receive a furlough grant for unworked hours.
  • The Job Support Scheme (JSS) was due to replace the Coronavirus Job Retention Scheme. Following the extension of the Coronavirus Job Retention Scheme, the JSS has been postponed.
  • The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the Statutory Sick Pay paid to current or former employees from 28 February 2020. Up to 2 weeks of statutory sick pay can be claimed back.
  • The support announced by the Chancellor will be made available through banks. Speak to your bank or lending provider about access to the scheme.
  • The Coronavirus Business Interruption Loan Scheme (CBILS) and the “Bounce Back Loans” are being replaced by a new Recovery Loan Scheme. Under the new scheme, businesses of any size can apply for a loan of £25,000 to £10m through to the end of 2021, and the Government will provide a guarantee to lenders of 80%. The scheme launches on 6 April 2021 and is open until 31 December 2021.
  • The Coronavirus Large Business Interruption Loan Scheme (CLBILS) helps medium and large-sized businesses to access loans of up to £200m. This scheme remains open to applications until 31 March 2021.
  • The Restart Grant Scheme is being introduced to offer grants to help retail, hospitality and personal care businesses reopen from April 2021. Retailers, which are due to reopen in April 2021, will be eligible for grants of up to £6,000 per premises. Pubs, restaurants and salons, which are set to be closed until June 2021, will be able to claim grants of up to £18,000.
  • Grants for smaller businesses of up to £10k will be channelled through local authorities. If you think you may need this support, speak to your local authority.
  • Business rates are cut and will automatically be applied.
  • Most banks have launched a working capital support facility so speak to them if you need this.
  • VAT payments due between 20 March 2020 and 30 June 2020 were deferred. At the time, the full amount of the VAT deferred was to be paid by 31 March 2021. Businesses can now opt-in to a scheme which enables them to make smaller payments up to the end of March 2022, interest free. The application process for this deferral opened on 23 Feb 2021 and runs until 21 June 2021. Businesses which have not opted in must pay the VAT due by 31 March 2021.
  • Don’t forget the long-standing R&D tax credit scheme which could provide a cash injection

How will the Coronavirus Business Interruption Loan Scheme (CBILS) effect my R&D tax credit claim?

We have received several queries from concerned clients and accountants highlighting that the CBILS is state aid and wondering how that impacts R&D claims.

If the CBILS relates specifically to the company’s R&D expenditure [on a project] rather than being intended more generally to support the company, then this could impact your R&D claim. This is because the Government has notified CBILS as a State aid under the European Commission’s new Temporary Framework for COVID-19. The measure is a fully notified aid, so the restriction on receipt of other State aid (s1138(1)(a) CTA 2009) potentially applies.

Therefore providing the loans are provided to generally support the company and are not provided to fund a specific R&D project then there will be no impact on the R&D claim. We very much doubt that there will be any clients or claimant companies receiving funding for a specific R&D project under the CBILS scheme and therefore not something we envisage becoming an issue for any companies R&D claim. We will continue to monitor the situation and as we are members of the Research and Development Consultative Committee (RDCC) we will be able to feedback to HMRC through that channel.

Also for further clarity this also only applies to anyone claiming under the SME schemeRDEC claimants will remain unaffected by this.

At present we are awaiting confirmation of how Recovery Loan scheme will be treated under state aid rules, and what this could mean for R&D tax relief claims. We will seek further information and advice as soon as it is available.

The financial benefit of claiming R&D tax credits, more important now than ever

If you are a company who can take the R&D tax benefit as cash, it will be a vital cash injection so making a claim is more important than ever.

Businesses and Accountants will be spinning many plates in the coming months so making sure you have other advisors around to lighten the load is crucial.

HMRC will continue to pay out tax credits even if you have delayed payments to HMRC due to Covid-19. Now is the time to be proactive and get ahead by starting the claim processes as soon as you can. We will make this processes as smooth as possible and will minimise the time you need to spend on this – leave it to us and you can focus on steering the ship.

R&D activity helps to protect jobs across the company. 80% of R&D tax claims are made up of people’s time so if you have resources that cannot be utilised in the normal way, think about if they can be deployed into development roles to help when the tide eventually turns. A percentage of these costs will be able to be reclaimed through R&D tax relief.

Should any companies need the cash sooner, there are R&D tax short term loan options available. We work with Rocking Horse Group and can facilitate the introduction should this be an option you wish to explore.

UK’s innovative companies answering the call

In the face of adversity, the entrepreneurial British spirit cannot be kept quiet and innovation shines through. From cutting edge medical research to find a vaccine, through to changing production lines to deliver what Britain needs right now.

This pandemic is moving at an unprecedented rate but we will stay ahead and beat it thanks to common sense and innovation and it’s our privilege to champion and take pride in the work of our fellow UK businesses.

And we will stand shoulder to shoulder with you

Now is the time to do as much as possible for each other and as a SME working with hundreds of companies across the UK we will do everything we can to support. We will get the R&D tax credits sorted and work around client priorities, we will change our payment terms to help others with cashflow issues, we will listen to our clients and adapt with them, our terms will flex with those that need it the most and we will survive together.

Our incredible team have moved to 100% remote working and have not slowed down for a second. We are ready to continue to deliver for our clients when we know that right now, doing what we do is more important to our clients than ever before.

We won’t be able to come and see our clients in this period but we will still use our experience and knowledge to capture as much qualifying activity as possible. Working remotely is not new to us and we have the experience and team to manage your claim regardless. If there is still more to get by coming to visit you, we will know that, and come back when we are allowed to find and recognise that value for you.

Theres a way to do it better - find it.

Thomas Edison