Coronavirus: Updated analysis and guidance on UK Government support for businesses - in depth - Gateley
In depth

Coronavirus: Updated analysis and guidance on UK Government support for businesses

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The Government has announced a wide-ranging package of measures designed to support people and business through the uncertainty caused by the COVID-19 pandemic and the disruption it has caused and will continue to cause for the foreseeable future. These include the following:

  • Funding (for large corporates and business interruption loans); 
  • Employment (job retention and sick pay);
  • Deferral of tax payments (VAT, income tax and use of time to pay arrangements);
  • Business rates holidays and grants;
  • Bans on evictions for commercial tenants; and
  • Support for lenders.

A key message for clients is that employing only one of these support mechanisms is unlikely to provide a total solution to the myriad of issues facing a business and directors and shareholders will need to consider utilising a combination of the schemes available. Gateley will be available to assist you throughout the current period of uncertainty.

The Government continues to update the package and more information on the measures is published regularly. Options available and the manner in which they are interpreted and applied will continue to develop over time and the outline below remains a starting point and will evolve.  We are actively monitoring the situation, including any proposed legislative changes, and we aim to provide businesses with the most up to date advice and support possible. We will of course be happy to discuss any particular concerns you may have and provide tailored updates on any developments.

Businesses will need to consider and make use of a combination of the forms of support being provided by the UK government. These measures, along with assistance from key stakeholders, should provide some breathing space for businesses in the short-term, but they are not medium-term or long-term fixes. Cashflow concerns might be alleviated but they do not solve balance sheet issues a business might be facing. Businesses should consider and prepare not only for the current position but also address how the business may perform once we are through the worst of the current situation and we would expect that lenders, other key creditors and stakeholders will seek your views on future plans. Companies should seek advice from their professional advisers at an early stage to ensure they are able to navigate their obligations and comply with their duties.

Analysis

Job Retention Scheme and Statutory Sick Pay relief package

Read our standalone analysis here.

Deferred VAT and Income Tax payments 

Read our standalone analysis here.

HMRC Time to Pay Scheme

Although HMRC have suspended all recovery action in relation to existing tax arrears and existing petitions are being adjourned, businesses may wish to consider entering into a formal time to pay arrangement with HMRC, allowing outstanding tax liabilities to be paid by instalments over a 12 month period. Supporting facts, evidence and documentation will need to be provided to HMRC to effectively evidence the concerns over the businesses’ cashflow and ability to pay. Please see separate Gateley analysis.

Ban on evictions for commercial tenants who miss rent payments

Read our standalone analysis here.

Business rates holidays and Retail and Hospitality Grant Scheme

The relief is to be administered and provided by the relevant local authority via council tax bills to be issued in April 2020. If your business falls within one of the sectors eligible for relief (retail, hospitality and leisure or a nursery) it would be advisable to contact your local authority to ensure they are correctly categorising your business. 

Covid Corporate Financing Facility (CCFF):

The CCFF scheme is aimed at providing funding for large, investment grade companies. It should provide a quick and cost-effective way for the most credit-worthy companies to raise working capital via the purchase of short-term debt in the form of commercial paper. 

Initially, the eligibility criteria meant that companies without a credit rating from one of the major credit rating agencies (CRAs) might have been prevented from accessing the scheme due to the cost and time for obtaining a formal credit rating. However, following review of the eligibility criteria, the Bank of England have clarified that if it is likely that advice from the company’s bank is that the proposed issuer was viewed internally as equivalent to investment grade as at 1 March 2020 then this may be sufficient.

The Bank of England will make an assessment of whether a company can be deemed as equivalent to having a public investment grade rating drawing on a range of information, including the company’s banks’ internal ratings across all of a firm’s commercial bank counterparties. A firm will need to be rated consistently by its bankers as investment grade to qualify on this basis.

Companies with a strong business prior to 1 March 2020 which make a material contribution to the economic activity in the UK (directly or in service industries) and which have strong, demonstrable credit ratings should be able to access this scheme. 

Coronavirus Business Interruption Loan Scheme (CBILS):

The CBILS is intended to provide some assistance to eligible businesses. However, we anticipate that lenders will be mindful that the Government guarantee will only extend to 80% of any shortfall they suffer on recovery of CBIL loans and so are likely to rely on conventional lending processes and credit risk criteria.  Where possible companies will be required to provide additional security or limited guarantees (for loans in excess of £250,000) to support new lending although it is unclear how extensive such security and guarantees will need to be to satisfy lenders’ credit processes. 

It is hoped that lenders will operate within the spirit of the collective national interest at this stage and we note the unprecedented step taken by the issue of a joint letter from HMT, the Bank of England and FCA to all UK banks and building societies stating that all stakeholders in the UK economy need to “take all action necessary to ensure that the benefits of the measures outlined above [including CCFF and CBILS] are passed through to businesses and consumers. This will require a willingness to maintain and extend lending despite the uncertain economic conditions. We must ensure that firms whose business models were viable before this crisis remain viable once it is over. This includes those firms not covered by CBILS or CCFF”. 

Any funding needs should be considered in the round along with other potential relief and support packages, grants, and all other sources of finance including key stakeholders and investors.  It is likely that amending terms of existing facilities (e.g. increasing the amount borrowed, extending maturities, amending covenants and other amendments to repayment terms) will be the first course of action for most businesses when determining how to fund their trading needs in the short and medium term.  If existing lenders cannot assist you can apply to any provider on the accredited list, which is expanding as time progresses.

Coronavirus large business interruption loan scheme (clbils):

This scheme is not available yet but is expected to launch before the end of April 2020.  CLBILS will support larger businesses with an annual turnover of between £45 million and £500 million, and facilitate access to loans of up to £25 million.  Loans will be backed by a Government guarantee again extending to 80% of any shortfall suffered by the lender on recovery.

Pandemic and Government-ordered closure insurance

The Government and insurance industry have confirmed that businesses that have cover for pandemics, Government-ordered closure, and unspecified notifiable disease should be able to make a claim, provided all other terms and conditions of their policy are met.

Summaries of UK Government COVID-19 support

Scroll down for summaries of the following support measures:

  1. Job Retention Scheme
  2. Statutory Sick Pay relief package
  3. Deferred VAT and Income Tax payments
  4. HMRC Time to Pay Scheme
  5. Ban on evictions for commercial tenants who miss rent payments
  6. Business rates holidays and Retail and Hospitality Grant Scheme
  7. Covid Corporate Financing Facility (CCFF)
  8. Coronavirus Business Interruption Loan Scheme (CBILS)
  9. Pandemic and Government-ordered closure insurance
  10. Retail and Hospitality Grant Scheme
  11. Grant funding – Business paying little or no business rates

1. Coronavirus Job Retention Scheme

Overview

All UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during the crisis.

Operation

HMRC will reimburse 80% of these workers’ wage costs, up to a cap of £2,500 per month plus the associated Employer National Insurance contributions and pension contributions on that subsidised furlough pay. 

HMRC will not reimburse the cost of non-monetary benefits provided to employees, including taxable Benefits in Kind.  Similarly, benefits provided through salary sacrifice schemes are not included.

Applications for grants will commence on 20 April and the first payments from HMRC are expected by the end of April

Applications can be backdated to the date furlough commenced, although not earlier than 1 March 2020. The scheme will run for at least 3 months from 1 March, so until 31 May 2020, but may be extended by government. 

Eligibility

All UK businesses are eligible. The scheme applies to all employees and workers registered on the employer’s PAYE system on 28 February. The scheme does not apply in relation to employees working from home.

Employees can be on any type of employment contract, including full-time, part-time, agency, fixed term, flexible or zero-hour contracts. Foreign nationals are eligible to be furloughed. You can furlough employees on all categories of visa as well as apprentices. 

As well as employees, the grant can be claimed for any of the following groups, if they are paid via PAYE: office holders (including company directors), salaried members of Limited Liability Partnerships (LLPs), agency workers (including those employed by umbrella companies), and limb (b) workers.

Where a company is being taken under the management of an administrator, the administrator will be able to access the Job Retention Scheme. However, we would expect an administrator would only access the scheme if there is a reasonable likelihood of rehiring the workers. 

Application

To access the scheme, the company will need to:  

  1. Designate affected employees as ‘furloughed workers,’ and notify their employees of this change - changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and 
  2. Submit information to HMRC about furloughed employees and their earnings through a new online portal.

A furloughed employee can take part in volunteer work and engage in training so long as they do not provide services to or generate revenue for an organisation or a linked or associated organisation.

Any employees placed on furlough must be furloughed for a minimum period of 3 consecutive weeks. Employees can be furloughed multiple times, but each separate instance must be for a minimum period of 3 consecutive weeks.

Helpful Information

General information on the Government schemes in operation

We are happy to provide Gateley Legal’s briefing note on the Job Retention Scheme on request. 

2. Statutory Sick Pay relief package

Overview

Government has brought forward legislation (the Coronavirus Act 2020) to allow SMEs and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. 

Operation

SMEs may recover the cost where SSP has been paid as a result of COVID 19 for a maximum of two weeks’ sickness per employee starting on or after 13 March 2020.

Eligibility

You are eligible for the scheme if:

 

  1. the business is UK based; 
  2. had a PAYE payroll scheme created and started on or before 28 February 2020; and
  3. the business is small or medium-sized and employs fewer than 250 employees as of 28 February 2020.

The scheme’s eligible period will commence the day after the regulations on the extension of SSP to those staying at home comes into force. 

Application

There is no current mechanism for SSP recovery by employers. The Government is developing a rebate scheme to administer up the repayment mechanism for employers as soon as possible. 

You must keep records of all the statutory sick payments you wish to claim from HMRC, including:

  1. The reason why an employee could not work
  2. details of each period when an employee could not work, including start and end dates
  3. details of the SSP qualifying days when an employee could not work
  4. National Insurance numbers of all employees who you have paid SSP to

 

You’ll have to keep these records for at least 3 years following your claim.

3. Deferred VAT and Income Tax payments

Overview

VAT  

  • Businesses will be supported by VAT payments being deferred for 3 months.  
  • The deferral will apply from 20 March 2020 until 30 June 2020.
  • Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. 
  • VAT refunds and reclaims will be paid by the Government as normal.
  • It does not cover payments for VAT MOSS or import VAT.

Income Tax

  • For self-employed persons, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. 
  • No penalties or interest for late payment will be charged during the deferral period.

Eligibility

VAT  

  • All UK businesses are eligible where they have a VAT payment due between 20 March 2020 and 30 June 2020. 

Income Tax

  • If you are self-employed you are eligible. 

Application

This is an automatic offer with no applications required. 

Helpful information

General information on the Government schemes in operation

4. HMRC Time To Pay Scheme

Overview

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. 

Operation

In response to COVID, this existing scheme has had an increase in resources and resource and a specific COVID 19 helpline has been established (0800 0159 559). 

TTP exists to allow a business to defer their current tax debts (mainly corporation / income tax, payroll taxes and VAT) by converting payments into instalments over a 3-12 months period. In return, directors of the businesses are expected to provide written confirmation that the agreed instalment will be made on time.

Evidence shows HMRC are suspending all recovery action in relation to existing tax arrears.    

Eligibility

You are eligible if your business:

  1. pays tax to the UK Government
  2. has outstanding tax liabilities

Supporting facts, evidence and documentation will be needed to effectively evidence the concerns over the businesses’ cashflow and ability to pay. 

HMRC use this scheme as a remedy of last resort, it must be evidenced all other potential sources of finance have been pursued. 

Application

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

For amounts less than £750,000, the process can take less than an hour for the amount to be deferred.  For larger sums, it is likely a longer period of time will be required to reach agreement. 

If the business has missed a tax payment or might miss their next payment due to COVID-19, they are advised to call HMRC’s dedicated helpline: 0800 0159 559. If they are worried about a future payment, they are advised to call nearer the time.

Helpful Information

Government guidance for if the business cannot pay their tax bill on time 
General information on the Government schemes in operation

5. Ban on evictions for commercial tenants who miss rent payments 

Overview

Under the Coronavirus Act 2020 the Government introduced legislation to protect commercial tenants from eviction/forfeiture unable to pay rent because of the coronavirus outbreak.


Measures support ongoing conversations between landlords and tenants about voluntary arrangements.

Operation

This covers a landlord’s right to re-entry and possession for non-payment of rent only.  However, this does not waive tenants’ obligation to pay rent during the three-month period. 

No business will be forced out of their premises if they miss a payment in the next three months.

It will last until 30 June, with an option for the Government to extend if needed. 

After the relevant period (and any extension), the ban on forfeiture will come to an end and tenant will be liable to make payment for the rent during the relevant period (and any extension) and payment of the rent for the next quarter.

The legislation only covers forfeiture, other remedies for recovery of arrears are still available.

Eligibility

Will apply to all business tenancies. The legislation describes “rent” as any sum a tenant is liable to pay under a relevant business tenancy. Therefore, as well as rent, the landlord will not be able to forfeit non-payment of other sums, such as service charge.

Application

During this period, except if the landlord gives an express waiver in writing, no conduct or action by the landlord will amount to a waiver of the right to forfeit for non-payment of rent. This means that the right to forfeit is preserved, but put on hold, and can be actioned for non-payment of rent after the relevant period has expired.


If landlords have rent outstanding for the December quarter or monthly payments and the right to forfeit has already arisen, then they can still forfeit. 

Helpful Information

Government press release

General information on the Government schemes in operation

6. Business rates holiday for nurseries and retail, hospitality and leisure businesses

Overview

A business rates holiday for nurseries and retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. 

Operation

Allows for a for a 100% business rates discount for all nurseries and retail, leisure and hospitality businesses. Detailed information on the eligible types of property are contained in guidance notes issued by the Government.

Currently, the existing rules in relation to unoccupied properties continue to apply. Properties closed for temporary purposes as a result of acting on the Government’s advice will be treated as occupied for the purposes of the relief.

Eligibility

Nurseries 
You are eligible for the business rates holiday if:

  1.  your business is based in England

Properties that will benefit from the relief will be hereditaments:

  1. occupied by providers on Ofsted’s Early Years Register
  2. wholly or mainly used for the provision of the Early Years Foundation Stage

Retail, hospitality and leisure businesses
You are eligible for the business rates holiday if:

  1. the business is based in England; and 
  2. the business is in the retail, hospitality and/or leisure sector

In broad terms, properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used as shops, restaurants, cafes, drinking establishments, cinemas and live music venues; for assembly and leisure; or as hotels, guest & boarding premises and self-catering accommodation. 

Application

No action is needed. This will apply to the company’s next council tax bill in April 2020. However, local authorities may have to reissue the bill automatically to exclude the business rate charge. 

Any enquiries on eligibility for, or provision of, the relief should be directed to the company’s respective local authority. 

Helpful Information

General information on the Government schemes in operation 

Business rates calculator to estimate the business rate charge businesses will no longer have to pay 

Government guidance for retail, hospitality and leisure businesses

Government guidance for nurseries

7. COVID Commercial Financing Facility (CCFF)

Overview

This is a scheme provided by the Bank of England, on behalf of HM Treasury, aiming to support larger businesses which are fundamentally strong but have been affected by a short-term funding squeeze. 

It aims to provide a quick and cost-effective way to raise working capital via the purchase of short-term debt. 

Operation

It will provide funding to businesses by purchasing newly issued commercial paper of up to one-year maturity from firms making a material contribution to the UK economy and, after issuance, from eligible counterparties in the secondary market. 

Issuing companies must act via a bank that operates commercial paper programmes.

It is intended to operate for an initial period of 12 months and for as long as steps are needed to relieve cash flow pressures on eligible businesses. 6 months’ notice of the withdrawal of the facility will be provided.

The Fund will purchase securities at a spread above a reference rate so that pricing is close to the market spreads prevailing before the economic shock from COVID-19. The pricing will be kept under review in light of market conditions.

Eligibility

Eligible Issuers: 
The issuing company must make a material contribution to UK economic activity, deciding factors include:

  1. Whether you are a UK incorporated company
  2. Whether you have significant employment in the UK or your headquarters is in the UK 
  3. Whether you generate significant revenues in the UK, serve a large number of UK customers or have a number of operating sites in the UK. 
  4. Whether you generate significant revenues in the UK, serve a large number of UK customers or have a number of operating sites in the UK. 

The issuing company must demonstrate they were in sound financial health prior to the shock.  To do so, you must have had, prior to being affected by COVID 19, a short- or long-term rating of investment grade, or financial health equivalent to an investment grade rating as at 1 March 2020. 

Companies that do not currently issue CP but are capable of doing so, and of meeting the Fund’s eligibility criteria, will be able to apply for and utilise the Facility if they so choose.

 The Facility is open to all non-financial companies that meet the eligibility criteria as set out above.

Eligible securities: 

The Bank of England are seeking sterling-denominated commercial paper from eligible issuers with a maturity of one week to 12 months, a short or long-term rating of investment grade, and issued directly into Euroclear and/or Clearstream. 

Application

Eligibility and form submission: 
Interested companies are asked to discuss with their bank, or by contacting the Bank of England directly, whether they are eligible to take part in the scheme. 

If the company believe they are eligible, an eligibility form and other paperwork will need to submitted by email to the Bank of England. The company’s bank must also submit paperwork to act as the dealer of the issuing company’s commercial paper. 

Once submitted, the Bank of England will confirm back if the commercial paper is eligible as soon as possible. If confirmed before 16:00 on a working day, commercial paper can be sold the next working day, via the company’s bank. 

Submission of offers: 

Offers to sell will be submitted by phone between 10.00am and 11.00am from a single dealer per issuer per day. The minimum size of purchase per participant is £1 million nominal.  

Bank of England will confirm as soon as possible whether an offer has been accepted and will confirm the cash amount and maturity date. The purchase will normally settle on a T+2 basis.

Helpful Information

Q&A for companies and their banks (includes the relevant forms)

Accompanying market notice (for more technical detail)

General information on the Government schemes in operation

Contact details for the appropriate desk at each of the main banks to make CCFF enquiries

8. Coronavirus Business Interruption Loan Scheme (CBILS)

Overview

This scheme, delivered by the British Business Bank (BBB), is aimed to support SMEs access a wide range of business finance products. It will be provided by the BBB through participating providers (currently 40+ accredited lenders) and will offer more attractive terms for both businesses applying for new facilities and lenders, with the aim of supporting the continued provision of finance to UK businesses during the COVID outbreak. 

This replaces the Enterprise Finance Guarantee (EFG). 

Operation

  • The scheme provides the lender with a Government-backed partial guarantee of 80% (subject to a per-lender cap on claims) against the outstanding facility balance on each loan, potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’. 
  • The Government will also pay to cover the first 12 months of interest payments and any lender-levied fees. 
  • The borrower always remains 100% liable for the repayment of the capital.
  • CBILS will support a wide range of business finance products, including term facilities, overdrafts, invoice finance facilities, and asset finance facilities  
  • CBILS guarantees facilities up to a maximum of £5m available on repayment terms up to six years for term loans and asset finance. For overdrafts and invoice finance facilities, terms will be up to three years. 
  • There is no guarantee fee for SMEs to access the scheme. 
  • The scheme may be used for unsecured lending for facilities of £250,000 and under. For facilities above £250,000, the scheme requires the lender to establish a lack or absence of security prior to businesses using CBILS. 
  • The amount of funding available under the scheme will be demand-led. The scheme will initially run for six months.
  • Lenders will not take personal guarantees of any form for facilities below £250,000.
  • For facilities above £250,000, personal guarantees may still be required, at a lender’s discretion, but:
    • they exclude the Principal Private Residence; and
    • recoveries under these are capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied

Eligibility

To be eligible for a facility under CBILS, the business must:

  1. be UK based in its business activity with annual turnover of no more than £45m; 
  2. generate more than 50% of its turnover from trading activity;
  3. use the CBILS-backed facility to support primarily trading in the UK;
  4.  have a borrowing proposal which the lender would consider viable, if not for the coronavirus pandemic; and
  5. self-certify that it has been adversely impacted by the coronavirus (COVID-19).

Application

CBILS is available through the British Business Bank’s 40+ accredited lenders (listed on the British Business Bank website). These lenders range from high-street banks, challenger banks, asset-based lenders and smaller specialist local lenders.  

Decision-making on whether the business is eligible for CBILS is fully delegated to the accredited CBILS lenders.  

If one lender turns you down, you can still approach other lenders within the scheme.

Since commencement access to the scheme has been opened up to smaller businesses facing cashflow difficulties who previously would not have been eligible for CBILS because they met the requirements for a standard commercial facility.

Helpful Information

British Business Bank webpage for CBILS

CBILS FAQs for SMEs

Quick eligibility checklist for SMEs

List of accredited lenders

General information on the Government schemes in operation
 

9. Pandemic and Government-ordered closure insurance

The Government and insurance industry have confirmed that businesses that have cover for pandemics, Government-ordered closure, and unspecified notifiable disease should be able to make a claim, provided all other terms and conditions of their policy are met.

Overview

The Government and insurance industry have confirmed that businesses that have cover for pandemics, Government-ordered closure, and unspecified notifiable disease should be able to make a claim, provided all other terms and conditions of their policy are met.

Eligibility

Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy. 

Most businesses are unlikely to be covered, as standard business interruption insurance policies are dependent on damage to property and will exclude pandemics.

Application

Businesses advised to check the terms and conditions of their specific policy and contact their providers.

Helpful Information

General information on the Government schemes in operation

10. Retail and Hospitality Grant Scheme

Overview

Provides businesses in the retail, hospitality and leisure sectors with a cash grant per property depending on their rateable value. 

Operation

Businesses in these sectors with a property that has a rateable value of £15,000 and under:
Will receive a grant of £10,000 

Businesses in these sectors with a property that has a rateable value of between £15,000 and £51,000: 
Will receive a grant of £25,000 

Eligibility

You are eligible for the grant if:

  1. the business is based in England
  2. the business is in the retail, hospitality and/or leisure sector

In broad terms, properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

  • as shops, restaurants, cafes, drinking establishments, cinemas and live music venues;
  • for assembly and leisure; or
  • as hotels, guest & boarding premises and self-catering accommodation

The Government has issued a guidance note on the business rates holiday scheme which will provide further information on the eligible property. 

You cannot get RHLG for:

  • Properties occupied for personal uses, such as private stables and loose boxes, beach huts and moorings.
  • Car parks and parking spaces.
  • Properties with a rateable value of £51,000 or over.

Application

No action is needed. The local authority will write to the company if they are eligible for this grant. Any enquiries on eligibility for, or provision of, the relief should be directed to the company’s respective local authority (preferably the Economic Development Officer).  

Helpful Information

General information on the Government schemes in operation 

Business rates calculator 

Government guidance note on the business rates holiday for local authorities

11. Grant funding – Business paying little or no business rates

Overview

The Government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. 

Recipient will be the ratepayer in respect of the hereditament on the 11 March 2020. 

Operation

A one-off grant of £10,000 will be provided to eligible businesses to help meet their ongoing business costs. Funding under this scheme is expected to be provided to local authorities and available from 1st April 2020.

Eligibility

You are eligible if:

  1. your business is based in England
  2. you are a small business and already receive SBBR and/or RRR; and
  3. you are a business that occupies property

You cannot get SBGF for: 

  • Properties occupied for personal uses, such as private stables and loose boxes, beach huts and moorings. 
  • Car parks and parking spaces. 

Recipients need to have been meeting the eligibility criteria from 11 March 2020.

Application

No action is needed. The local authority will write to the company if they are eligible for this grant. 

Any enquiries on eligibility for, or provision of, the relief should be directed to the company’s respective local authority (ideally the Economic Development Officer). 

Helpful Information

General information on the Government schemes in operation

12. Coronavirus Large Business Interruption Loan Scheme

Overview

The Coronavirus Large Business Interruption Loan Scheme (CLBILS) will support large businesses, with an annual turnover of between £45 million and £500 million, to access loans of up to £25 million.

Operation

The scheme will be delivered through commercial lenders.  The government will provide an 80% guarantee on individual loans for businesses that would be otherwise be unable to access the finance they need.

Facilities backed by a guarantee under CLBILS will be offered at commercial rates of interest.

Eligibility

You’re eligible if your business:

  • is based in the UK
  • has an annual turnover of between £45 million and £500 million
  • is unable to secure regular commercial financing

You must also have a borrowing proposal which the lender:

  • would consider viable, if not for the coronavirus pandemic
  • believes will enable you to trade out of any short-term to medium-term difficulty
  • Businesses with a turnover of less than £45 million may be entitled to other government support.

Application

This scheme is not available yet. It is expected to launch before the end of April 2020.

Updated as at 14 April 2020

Please feel free to contact the individuals listed below or your usual Gateley Restructuring contact if you would like to discuss any of the issues raised above or if you require any specific advice or assistance. 

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