Following the cancelling of the autumn statement, Rishi Sunak has, (24 September 2020), announced further adjustments to the financial support packages available to businesses in the wake of the coronavirus pandemic.
Building on the support packages announced earlier this year; businesses in receipt of the Bounce Back Loan will now have more time to repay – taking the maximum repayment term from six years to 10 years, essentially halving monthly repayments. There is also the opportunity to suspend all payments for six months in very specific circumstances.
Businesses in receipt of a CBILs loan will have their guarantee period extended to 10 years with more time to pay. The deadline for these loans is the end of 2020 and there are likely to be additional schemes announced in the new year.
The Chancellor had previously announced the deferment of VAT bills and, for those businesses whose VAT payments fall in March 2021, they will now have the opportunity to spread those payments over the next 12 months, resulting in 11 smaller payments.
And finally - the hospitality and tourist industry which had had their VAT payments reduced to 5% have had the increase, due 13/1/21 cancelled until end of March 2021.
Roy Botterill,corporate partner, commented; “The Chancellor has been under mounting pressure to extend his support for businesses. The announcements today will certainly help in the short to medium term and give businesses a better chance to plan their recovery in an uncertain climate. We have to hope these measures, along with the new Jobs Support Scheme, will help businesses avoid the cliff edge that was potentially coming as the furlough scheme comes to an end. Some businesses will need every bit of cash to see themselves through and these measures will go some way to assisting with this.”
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