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Help for company directors during the COVID-19 coronavirus outbreak

The continuing coronavirus crisis is placing unprecedented pressure of business up and down the country, and indeed across the world. As you navigate these unchartered waters, it is good to know what help is out there for both you and your business. Help has been made available by the government as a direct result of the coronavirus outbreak, while existing safety nets such as director redundancy remain accessible for those that qualify.

Continue reading for more information on the various options open to company directors in light of the escalating crisis.

What help has the government offered?

The government has introduced a range of measures specifically designed to help companies with the unique challenges this global epidemic presents. These are temporary measures aimed at helping companies through the worst of this escalating crisis, allowing for

Key initiatives announced so far include:

  • Coronavirus Job Retention Scheme - The government have stepped in and offered to cover 80% of an employee’s wages for an initial three month period. It is hoped this will safeguard jobs while also ensuring companies are able to recommence trading when restrictions are lifted.
  • Emergency finance and funding – From traditional loans, through to asset and invoice financing, the government has pledged to help companies access the funds they need to keep their cash flow flowing when income is likely to have taken a hit. Borrowing undertaken through these schemes (such as the Coronavirus Business Interruption Loan Scheme, or CBILS) will be 80% secured by the government, giving banks more confidence when lending to companies who otherwise may not meet their strict criteria.
  • HMRC Time to Pay (TTP) arrangements – More companies are expected to be given additional time to settle their tax debts to HMRC. A dedicated helpline has been set up in order to help businesses put a payment plan in place. You can call the HMRC Time to Pay team on 0800 0159 559.
  • Grants for qualifying businesses – Businesses who qualify for small business rate relief or rural rate relief can access a non-repayable grant of £10,000, while grants of £25,000 will be made available for retail, hospitality and leisure businesses with property attracting a rateable value between £15,000 and £51,000. These businesses will also be able to take advantage of a 12 month business rates holiday.

It is expected that the help available will change in line with the overall situation. Further measures are likely to be announced as more and more businesses find themselves unable to continue to trade. 

While the government has pledged to help businesses and their owners throughout the continuing coronavirus crisis, it is an unfortunate reality that some companies will not be able to withstand the additional pressures placed upon them during this time even with this government intervention.

Redundancy claims are a very professional company, Caroline who is dealing with our case is friendly, compassionate and very clear in explaining everything during this difficult time. The service we have received has been amazing, Thank you.
Tina Hill
Tina Hill

Planning for all eventualities

Already struggling businesses may find the fallout of the coronavirus crisis to be the final straw, while other previously successful companies could be suddenly dragged into financial hardship as demand for their services dries up, or they are forced to temporarily close their doors to customers.

Of course, your primary concern will be to ensure your company survives these unexpectedly tough trading conditions over the coming months; however, it is wise to also consider your position should the situation become unmanageable.

You may qualify for director redundancy

Something you may not be aware of is the potential to claim director redundancy if the worst happens to your business. If your company is unable to continue trading or is overwhelmed with financial pressures, and you are left with no alternative but to close your business for good, a safety net in the form of director redundancy could be there to help cushion the blow for you on a personal level.

So long as you are currently on the payroll of your limited company, and have been for at least two years, it is likely that you will have a legitimate redundancy claim should the company become insolvent and enter formal liquidation proceedings, such as a Creditors’ Voluntary Liquidation (CVL).

During these uncertain times it is more important than ever to know exactly what sort of help is out there no matter what the future holds. The team of expert advisers at Redundancy Claims UK can talk you through the director redundancy process and can let you know if you have a successful claim. Should you wish to go ahead with a claim for director redundancy, your dedicated case manager will be with you every step of the way from submitting your application through to liaising with the Redundancy Payments Service on your behalf.

The next few months present an unparalleled challenge to companies both big and small and across all sectors and industries. It is wise to plan for all eventualities, allowing you to make a carefully considered decision about the future of your business depending on how the situation progresses and how long restrictions on social movement are in effect.

Our claims calculator can be found here and is a great starting point for those considering director redundancy.

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