Since the start of the Coronavirus pandemic, the Government has offered support to businesses through several different routes these being, grants, business rate reliefs and also loans with the help of banks.
As businesses continue to struggle there was an announcement last week that the Government is extending four temporary loan schemes, to 30 November 2020.
This is to allow more businesses the time to make an application if they need to. The four main loans are:
The Bounce Back Loan is perfect for small businesses and allows them to access finances quickly. They can apply for a minimum of £2,000 and up to £50,000. This is capped at 25% of turnover, with a 100% government guarantee to the lender.
As part of the new 'Pay as you Grow' options announced by the Government last week you will have the opportunity to repay the loan over up to ten years. There are also other options that offer interest-only payments for short periods as well as an option to pause the repayments for six months if needed.
This scheme is intended for small businesses that need to borrow up to £5million. The Government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months. By having the government guarantee lenders have been more confident about businesses borrowing up to this level.
This loan is available for businesses based in the UK that have an annual turnover of up to £45K.
This scheme is for medium to large-sized businesses. It provides loans of up to £200 million (to a maximum of 25% of turnover). The Government guarantees 80% of the finance to the lender.
Coronavirus Business Interruption Loan Scheme lenders will be given the ability to extend the length of loans from a maximum of six years to ten years if it helps businesses to repay the loan.
The Future Fund issues loans between £125,000 to £5 million to innovative companies that are facing financing difficulties due to the coronavirus outbreak.
These convertible loans are a good option for new businesses that rely on equity investment and are unable to access other government business support programmes because they are either pre-revenue or pre-profit.
The experience of our clients has shown that some of these loans were easier to access than others. If you are interested in applying for one of these loans and would like some more advice about these or about managing, your cash flow over this difficult time, then please do contact us.
You can call 01623 490 120 or email This email address is being protected from spambots. You need JavaScript enabled to view it..
Haidee is our Personal Tax Director and is a fully qualified tax adviser, having achieved the ATT qualification in 2006. Tax efficiency being her main concern. Specialising in taxation, Haidee provides clients with advice on personal tax, PAYE services, VAT and social security. She also provides guidance to new start-up businesses.
Call us today on01623 490120
or email info@watsonk.co.uk
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