Business support and advice from ELS
Following the updated government advice yesterday, the ELS team will now work from home for the foreseeable future. We are fully equipped to continue business in this manner and maintain our services to clients.
These are unprecedented events. I’ve experienced two recessions in my career, but neither had an impact on businesses like the current circumstances will. I had first-hand experience yesterday with a director of a travel operator whose business faces immediate closure. An extremely difficult situation for him to deal with.
There are numerous steps that can be taken to enhance the chances of a business making it through these difficult times. The underlying principles with all points detailed below are planning and communication. Financial pressures will only be exacerbated if not.
Short term cash flow forecast - prepare an immediate 13 week cash flow. Payroll should be the number one priority;
Employees – keep communicating. Discuss business strategy to enhance employee engagement;
HMRC - it is imperative to calculate tax liabilities (whether PAYE/NI, VAT or CT) and make submissions to HMRC on time. In doing so, HMRC will be aware of the liabilities owed and subsequently will not have to rely on assessments. Consider a request for formal Time To Pay agreement from HMRC. A dedicated helpline has been set up at HMRC 0800 0159559;
Insurers – liaise with insurers. Explore the extent of cover, specifically whether there is any business continuity cover;
Business rates - contact local authorities to propose delayed payment of business rates. It was announced in the budget that there is also a one-off £3k grant available for businesses eligible for Small Business Rate Relief;
Rent - set up urgent meetings with landlords to ask for rent holiday or deferred payment of monthly rent;
Trade suppliers – other businesses are facing the same dilemmas. Politely explore viability to defer payment and elaborate on the circumstances the business is facing;
Customers – should there be an issue in delivering services, keep customers updated. Agree to realistic timeframes so that you are not subsequently shooting yourself in the foot by failing to deliver on time;
Bank loans - speak to banks to arrange payment terms and financing. Payment holidays may be feasible;
Sick pay - reclaim statutory sick pay for absence due to COVID-19 (the government refund will cover 2 weeks for employers with less than 250 employees). It doesn’t look like the money is available as yet so ensure proper records are kept to reclaim in the future;
Government loans – the budget announced that a Coronavirus Business Interruption Loan Scheme will launch in a matter of weeks to support businesses to access bank lending and overdrafts with a guarantee of 80% on each loan up to £1.2m. How this will manifest itself is a current unknown.
Please do not hesitate to contact us on either 01132 623 952 or 01904 404 556 if you have any concerns or require any advice.
On a personal level, look after one another, your staff and yourself.
ELS Advisory Limited