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Financial Update 1 May 2020

As we head into May, there is much debate about when the UK will begin to see a relaxation of the lockdown. We are hearing that construction companies and car franchises, to name but two sectors, plan to reopen in the next few weeks which promises hope for other businesses and the economy in general. That said, the signs are that the relaxation will be staggered with retail, hospitality and leisure probably being the last to reopen. This is clearly going to be a major challenge for some businesses, so we await the forthcoming Government review with great interest.

The benefits of remote and home working have been talked about a great deal in the past month or so. It is even more encouraging to see many businesses looking at alternative ways of operating and finding new revenue streams and customers in these difficult times. On-line shopping and home delivery is one development that seems to be proving very popular. (Joe Wicks is probably another!). Although there is a great deal of uncertainty and this is likely to continue for the foreseeable future, it is inspiring to see how many of you are rising to the challenge.

This briefing note provides updates and commentary on the following issues:

  1. Grants: flaws revealed
  2. Job intervention scheme: update
  3. Planning for the restart: entrepreneurs revealed
  4. BBL: CBILS’ little brother
  5. Self employed income support scheme: patience required
  6. Other information
  7. And finally


You may have seen reports in the press that local councils have had varying degrees of success in paying out grants. We believe most claims have now been paid.

Although it has always been the case that eligibility for the grant is linked to small business rates relief, it has become apparent in past weeks that there are many businesses that do not qualify, notably those that do not occupy business premises (or the estimated 10,000 businesses who occupy a shared space) and those in the holiday accommodation sector. All of these businesses share one thing in common: they are not listed by their local authority as occupying commercial premises. At this moment in time, there does not seem to be a solution, but we do know that dialogue is continuing between councils and businesses on the issue. There has also been some coverage in the national press, so we remain hopeful that the government will recognise the problem and act to resolve it.

Job retention scheme

All of you that have made a claim should have received your first grant by now (or soon will do). Our experience is that payment takes roughly a week from the date of claim. We have been dealing with claims on behalf of many clients; if you need help in submitting a claim or if you have not received payment yet, do let us know.

Currently the scheme will cover furlough up to 30 June. For some businesses, this will be more than sufficient to cover a restart but for some, this will undoubtedly come around far too soon. A recent survey indicated that 90% of businesses want the scheme to be extended to September; although we think this is unlikely, government is being lobbied for an extension on a sector by sector basis, which is probably more credible. As yet, the government has not made its intentions public but hopefully we will hear more in the coming week.

Remember that you can recall staff to work at any time and on a selective basis – this was a deliberate feature of the scheme and was intended to help businesses to manage a phased restart. Should you find you have been optimistic in the staff recall, up to 30 June, you can always re-furlough staff if necessary.

For those businesses that have staff on furlough, it is an unfortunate and unpleasant reality that trading after the lockdown has ended may not be the same as before. As a consequence, we recommend that you should start planning for the end of the job retention scheme now, particularly in relation to staff. Remember that your employees are still under contract whilst on furlough and retain all existing employment rights. If you think there is any chance you may need to look at redundancy, do please bear in mind that you need to take account of any required consultation period and factor in the cost of notice pay and accrued holiday, as well as redundancy entitlement. Clearly we hope this will only be necessary in the most extreme cases, but if you do need specific advice and just want to talk things through, let us know.

Planning for the restart

In our last update, we looked at key areas to consider.

Although the last 5 weeks or so have been painful for many (some more than others), the immediate impact has been alleviated to some extent by the job retention scheme, the availability of business grants and the hope of other support. We believe that the next two or three months are likely to prove even more difficult for many businesses as the grant money runs out or as they attempt to restart. The increased pressure on short term cash flow and the ability to accurately predict any shortfall are therefore likely to be critical factors in the survival of these businesses.

We strongly recommend that all businesses should prepare a cash flow forecast through to (at least) the autumn to look at the peak pressure points and to assess what further action might need to be taken. Your forecast does not need to be complex or detailed and clearly there will be a degree of guesswork on predicted sales revenues. However, the mere act of compiling the forecast will be useful as it will help to clarify your thinking on the short term future of your business. If you have not yet acted on this or you need help on how to start (or finish), just let us know.

There is much speculation on the longer term impact of Covid and the phrase “new normal” has been in regular use. Although we suspect that old habits will die hard, there will undoubtedly be some changes in behaviour and this, just like the lockdown, is bound to present opportunities for all of us. Do remember this when you think about the restart.

BBL: CBILS’s little brother

On Monday, the Chancellor announced a new package with the very technical name of “Bounce Back Loan”.

This loan is aimed at small businesses that fall below the companies and the borrowing range typically targeted by CBILS. Both loans are interest free for 12 months, but the BBL is set at 25% of turnover up to a maximum of £50,000. The application process is intended to be much simpler than it is for CBILS.

These loans (as the names imply) are intended to provide rescue funds for companies impacted by the crisis. If, having looked at forward cash flow, you think you might need support, we recommend you give serious consideration to these loans. In our view, it is better to apply and to not need it, than to have not applied at all and to regret it.

Businesses cannot apply for both loans: if you think £50,000 will be enough, aim for BBL. If you think you need more, look at CBILS.

Please bear in mind that BBL is not yet live, but is due to launch on Monday next (4 May). There will undoubtedly be multiple web links to access the application process but, as always, if you need more information, advice or help with the detailed application, let us know.

Self employed income support scheme

There is little further to note on this scheme. As we commented two weeks’ ago, HMRC will be contacting eligible businesses around mid May and paying out in early June so no further action at this time.

We have been providing calculations of likely grant payment on an ad hoc basis – if you would like advice on this issue, please let us know.

Other information

We continue to see reports of scams and phishing. Please be vigilant. If you receive a suspect email, you should forward it to HMRC at It will make a difference.

As mentioned in earlier updates, we have seen evidence that local MPs are keen to provide help and assistance to businesses, often just putting you in touch with the right person in your local council or elsewhere. Please don’t be frightened to contact your MP – they are aware of the difficulties facing businesses and will do what they can. Please also tell them of problems you are facing and ask them to pass the information to the government. It will make a difference.

Similarly, if you are a member of the FSB or any other business organisation, do complete surveys and do provide feedback where you can. These organisations are lobbying for change and need information from members to be able to do so effectively.

There has recently been an acknowledgement by the government of the fact that small business owners operating via limited companies (which is many of us) have themselves received virtually no support from government. Analysis has suggested that this could affect around 800,000 company directors. Given that, since 2016, tax has been charged on dividends received by company owners, we are of the opinion that this is unfair and a flawed approach. The CBI and other business groups have been lobbying the government on the issue and, although probably optimistic on our part, we remain hopeful that there might be some change in the coming weeks.

Although falling outside our field of work, we have seen guidance on increased protection for business tenants struggling to pay rents. If you are experiencing such issues, we recommend you speak to your landlord in the first instance and, if necessary, seek legal advice.

And finally

As always, we gratefully digest all feedback and contributions and use these as part of our regular updates. Please do feel free to forward this to anyone who you think might benefit and do check out other information on

As always, we remain here to provide help and support as far as we can. All of the team are working as normal (and in some cases also doubling up as home schoolers!) If you need assistance or further guidance, please contact any one of the team.

On a lighter note, we have recently been introduced to some new terminology coming out of the crisis. Notable examples include:

  • Coronials: as opposed to millennials, babies conceived during the corona crisis.
  • Covidiot: someone who behaves recklessly or with complete disregard for the safety of others.
  • Quarantinis: my personal favourite. Experimental cocktails mixed from whatever random ingredients you still have in the house. (Sometimes also referred to as locktails.)

More on this extremely important issue in later updates…

Take care


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