Lisa HoggView Profile
The pressure brought on by the government’s measures to curb the spread of Coronavirus is affecting business-owners nationwide. Many businesses have seen their workforces adapted for home working, and where this is not possible, unable to work at all. For those in the hospitality sector, the instructions are more rigid, after the government announced on Friday 20th March that all pubs, bars, restaurants, venues, and leisure facilities would need to close their doors.
What support is in place?
In an attempt to offset the financial implications brought with such instruction, the government has introduced a number of schemes open to businesses affected by the virus. Here’s a look at some of these:
Business Interruption Loan Scheme
The Business Interruption Loan Scheme was set out to support small and medium-sized businesses through the availability of loans, invoice finance, and overdrafts. These cover businesses for up to £5million in lending for a period of up to 6 years, with the first 12 months interest covered by the government. These are available from 40 certified lenders nationwide. To explore this option, please get in touch with one of our experienced advisors.
Cash grants for hospitality/retail businesses
The government announced that businesses in England forced to close due to the tightening measures could be eligible for grants of up to £25,000 per property. The local authority will make contact with eligible businesses, including pubs, cafes, and bars, with more information about how to access the scheme.
Coronavirus Job Retention Scheme
The Coronavirus Job Retention Scheme was introduced to help companies and their employees affected by the measures. For those in the hospitality sector, this scheme is especially useful. It allows for 80% of the monthly wage of those unable to work to be claimed, plus any automation National Insurance and pension contributions. The scheme is open to all UK employers for at least 3 months (starting from 1st March).
You can read more on eligibility for these schemes here.
What action can I take?
Aside from the schemes introduced by the government, there are a number of actions you can take to secure the position of your business in these turbulent times.
If you are struggling with debt, or your previous financial struggles have been worsened by the outbreak, it is crucial to act fast in order to secure the best possible outcome. With the help of insolvency professionals, such as ourselves, the following options may be available:
Company recovery: arrange an affordable repayment plan
If your company is in a position of financial difficulty, and is struggling to keep up with repayments of debt, various options are available to work towards its recovery. A company voluntary arrangement (CVA) is a process which allows insolvent companies to lower their debt levels without resorting to liquidation. With the help of a licensed insolvency practitioner (IP), the company reaches an agreement with its creditors as to how much of the debt they can afford to repay over a set time period (up to 5 years). The company’s finances are evaluated, and a monthly payment plan is drawn up alongside the company and its creditors. During the period, the company is protected from the action of its creditors. Read more about this, and other options here.
Company closure: creditors voluntary liquidation
If your debt is at such a level that company recovers is not realistic or practical, creditors voluntary liquidation (CVL) is an option. An insolvency practitioner oversees the process of a CVL. This process gives directors the chance to close the company’s doors, and realise its assets, before it is forced to do so by means of a winding-up petition. If you feel that your company’s financial situation has passed the point of revival, it is crucial to act quickly while you have the option. To find out more, get in touch.
The covid-19 outbreak has brought with it turbulence for businesses, especially those in the hospitality sector, who have been forced to close their doors. The move has left business owners concerned for the future of their companies, and employees concerned for their jobs.
The government has introduced a number of schemes in order to aid affected businesses. These include cash grants of up to £25,000 for hospitality businesses, and a job retention scheme which covers up to 80% of the monthly wages of affected employees.
If your company’s financial difficulties have been worsened by the measures, or you are struggling with debt, it is crucial that you act as quickly as possible. With the help of insolvency professionals such as ourselves, you can take steps towards rectifying these issues, and reduce the chance of further action being taken against you. Processes such as a company voluntary arrangement can help to lower debt levels through affordable monthly payments. If this isn’t viable, a creditors voluntary liquidation may be necessary to provide the best possible return to creditors, and tie up financial difficulties.
How we can help
As regulated insolvency professionals, Wilson Field have the knowledge and experience to guide you towards the best solution for your difficulties. We offer a free initial consultation with one of our empathetic, experienced advisors, who will talk you through the options available to you in your situation. It is important to act as soon as possible to secure the best possible outcome for your company and its creditors.
Coronavirus Business Interruption Loan Scheme (CBILS)
Here at Wilson Field, we have access to funders in all of the relevant sectors who can work with you towards obtaining funding from the CBILS. They can assist your company in putting together an application to increase the possibility of receiving the most relevant CBILS funding for your situation.
Alternatively, if your business is not deemed eligible for the scheme, Wilson Field can provide advice on restructuring options that may be beneficial in moving your business forward.