Covid-19 has disrupted business in ways we haven’t seen before. Many sectors – particularly those with small businesses at their core – are doing it tough. Government measures introduced several months ago to support UK businesses have recently been revisited and revised.
The VAT reduction in hospitality, which was cut to 5% and due to revert to 20% in January, has now been extended to 31 March 2021. Businesses can choose to pass on the reduction to try and attract more business or leave prices as they are and increase profits. In hospitality this is a very welcome move and will offset some of the damage of 10pm closing.
The Coronavirus Business Interruption Loan Scheme has been extended to 31 December (it was due to end on 30 September). Additionally, the maximum term of the loan period has been extended from six to ten years. Thirdly, if the business needs some breathing space the first repayment can be deferred for six months. These changes mean a potentially significant reduction in monthly loan repayments. It’s not necessarily an easy loan to get though, the usual banking loan criteria applies. If your business was in good shape before the Coronavirus but has been hit, you are more likely to be successful in your application. If your business was struggling before the Pandemic you might be lucky to get the loan.
Part 2 to follow.
