The government has extended applications for its coronavirus business support loan schemes – Bounce Back Loan Scheme (BBLS), Coronavirus Business Interruption Loan Scheme (CBILS) and Coronavirus Large Business Interruption Loan Scheme (CLBILS) – until January 31st 2021, ahead of England entering a second lockdown on Thursday. Many of you may have already applied these loans and have spent the money you received. As we go in to a second lockdown, do you require more finance? Will what you have get you through? There are options. If you have taken a bounce back loan you can still potentially get more via a CBILS or many other ways of funding should you require any type of funding. If you feel you need to acquire more funding, our corporate finance department will find out ALL your options and guide you to which one is best for you. Contact us on 02085300720 or email email@example.com
The Bounce Back Loan Scheme helps small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover. The maximum loan available is £50,000. The length of the loan is 6 years, but you can repay early without paying a fee. The government guarantees 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year. If you wish to apply for the “Bounce Back Loan” you will need to speak with your bank to begin the process. Providers are mainly only accepting (or prioritising) existing customers first. Check out our other Nordens article on the Bounce Back Loan Scheme to find a full list of bank providers, as well as their application forms HERE.
You can apply for a loan if your business:
- Is based in the UK
- Was established before 1st March 2020
- Has been adversely impacted by the coronavirus
The Coronavirus Business Interruption Loan Scheme helps small and medium-sized businesses to access loans and other kinds of finance up to £5 million. The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months. The maximum length of the facility depends on the type of finance you apply for and will be; up to 3 years for overdrafts and invoice finance facilities and up to 6 years, for loans and asset finance facilities.
You can apply for a loan if your business:
- is based in the UK
- has an annual turnover of up to £45 million
You need to show that your business:
- would be viable were it not for the pandemic
- has been adversely impacted by the coronavirus
If you want to borrow £30,000 or more, you also need to confirm that your business wasn’t classed as a business in difficulty on 31 December 2019.
You will need to get your financial information in order, as most banks are currently asking for the following information for applications:
2. Last 4 submitted VAT returns (where applicable)
3. Up to date management accounts
4. Aged debtor and creditor lists
5. Confirmation of any outstanding debt (provider, term, repayment)
6. Last 6 months bank statements
7. All directors (and >10% shareholders who are not directors) names, addresses, dates of birth
8. Statement of personal assets, liabilities, income and expenditure from all Directors
9. Paragraph on how Covid is affecting the business
10. Amount required
Financial Support For The Self Employed
The government is increasing its support to the self-employed over the coming months and ensuring people get paid faster than previously planned.
To reflect the recent changes to the furlough scheme, the UK-wide Self-Employment Income Support Scheme (SEISS) will be made more generous – with self-employed individuals receiving 80% of their average trading profits for November. To ensure those who need support get it as soon as possible, payments will also be made more quickly with the claims window being brought forward from 14th December to 30th November.
As SEISS grants are calculated over three months, the uplift for November to 80 per cent, along with the 40 per cent level of trading profits for December and January, increases the total level of the third grant to 55 per cent of trading profits. The maximum grant will increase to £5,160.
This provides broadly equivalent support to the self-employed as we are providing to employees through the government contribution in the Coronavirus Job Retention Scheme in November and then the Job Support Scheme in the two subsequent months.
To be eligible for the Grant Extension self-employed individuals, including members of partnerships, must:
- Have been previously eligible for the Self-Employment Income Support Scheme first and second grant (although they do not have to have claimed the previous grants)
- You must have filed a tax return for 2018/19, meaning you must have been self-employed before April 6, 2019
- You must earn more than half of your total income from self-employment and your trading profit must be less than £50,000 a year
- Self-employed workers who are company directors or run their businesses as limited companies cannot apply
- Declare that they intend to continue to trade and either:
- Are currently actively trading but are impacted by reduced demand due to coronavirus
- Were previously trading but are temporarily unable to do so due to coronavirus
- This follows the CJRS being extended until December. This provides broadly equivalent support to the self-employed as is being provided to employees through the government contribution in the Coronavirus Job Retention Scheme in November and then the Job Support Scheme in the two subsequent months.
The SEISS continues to be just one element of a comprehensive package of support for the self-employed. In addition to this they can also access other elements of the package which includes Bounce Back Loans, tax deferrals, rental support, mortgage holidays, and other business support grants. Both the government and banks will need all of your paperwork to be up to date and in order to consider you for any loans or grants. Make sure that you have sent everything in to us, in order and on time so that we can assist you with the best financial options for your business. To discus sending your paperwork in, call us on 02085300720 or email Abbie on firstname.lastname@example.org