The heritage crafts sector, which is predominantly made up of self-employed craftspeople and micro-businesses, is going to be particularly hard hit by the COVID-19 (coronavirus) pandemic, as retailers experience a drop in footfall and selling events are cancelled all around the country.
The guidance below is provided to let heritage crafts businesses know what help is available, and will be updated as things change. Please let us know if there is any support you are aware of not listed here and we will share the details.
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- New on 26 March: Self-employed income support scheme – the Government will provide a taxable grant of 80% of a self-employed person’s earnings up to a maximum of £2,500 month, eligible for those with trading profits of up to £50,000 who make the majority of their income from self-employment. You do not need to prove coronavirus impact and you can keep working and still benefit from the scheme. Earnings are calculated as an average over the past three years and based on net profits, i.e. the amount you declared for tax after you’d taken off expenses but before you were taxed. People can apply directly to HMRC for the grant when the scheme is operational, using an online form, and the grant will be paid directly into their bank account. The scheme will run for three months in the first instance and be available ‘no later than June’, though it will be backdated to March.
- Universal Credit for the self-employed – the minimum income floor for Universal Credit has been suspended. This means self-employed people out of work as a result of the COVID-19 can now access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay for employees (£94.25 per week for up to 28 weeks). The money will be payable from day one instead of day four. In addition, the Universal Credit standard allowance and the Working Tax Credit basic element will both increase by £1,000 a year for the next 12 months.
- Support for self-employed people paying tax – the next round of self-assessment payments on account (originally scheduled for 31 July 2020) have been deferred to January 2021. Additionally, all businesses and self-employed people in financial distress with outstanding tax liabilities may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s dedicated helpline on 0800 0159 559.
Small craft businesses
The Chancellor has introduced a package of measures to support businesses including:
- Coronavirus job retention scheme – companies and organisations will be able to apply for a grant from HMRC to cover 80 per cent of the wages of people, up to £2,500 a month, who are not working due to the coronavirus. The grant will be backdated to 1 March and available from April. It will be open initially for three months.
- Statutory sick pay relief package for small and medium sized enterprises – this means that, from the day after new regulations come into force, businesses will be refunded up to two weeks Statutory Sick Pay per eligible employee who has been off work because of COVID-19. Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a note from their GP.
- VAT deferral – the next quarter of VAT payments due from businesses have been deferred, meaning that no business will pay VAT from now to June, and they’ll have until the end of the financial year to repay those bills.
- Business rates holiday – for small businesses in England that have retail premises, there will be a 12-month business rates holiday for the 2020 to 2021 tax year.
- Grants for rate-paying businesses – Small businesses that have retail premises with a rateable value between £15,000 and £51,000 should receive grant funding of £25,000 to help meet their ongoing business costs. Small businesses that already receive Small Business Rate Relief (SBBR) or rural rate relief will be eligible for grant funding of £10,000. Enquiries about these grants should be directed to your local authority.
- Business Interruption Loan Scheme – this new scheme, delivered by the British Business Bank, will launch in late March to support small businesses to access bank lending and overdrafts. The government will provide lenders with a guarantee of 80 per cent on loans of up to £5 million in value. The first 12 months will be interest free, with payments covered by the government.
- Support for businesses paying tax – all businesses and self-employed people in financial distress with outstanding tax liabilities may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. If you are concerned about being able to pay your tax due to COVID-19, call HMRC’s dedicated helpline on 0800 0159 559.
Small craft businesses in Wales
The Welsh Government has published details of its £1.4 billion business support package to help businesses across Wales. In addition, the Development Bank of Wales will be offering all its business customers a three-month capital repayment holiday.
Facebook Small Business Grants Program
Facebook will be offering $100 million in cash grants and ad credits to help up to 30,000 eligible small businesses. The company will begin taking applications in the coming weeks and you can sign up to receive more information when it becomes available.