Updated: Wednesday 20th January 2021
The UK is now into its 3rd lockdown of the Coronavirus (COVID-19) pandemic. Many tradespeople are continuing to struggle with the everchanging regulations and demands in work, leaving them wondering what will happen to their business.
Plumbers, electricians, engineers, gardeners, builders and more are looking to the government for further financial support to help reduce the impact that Coronavirus is having on their livelihood.
With the situation changing regularly, tradespeople are constantly trying to navigate new guidelines, restrictions and support. In this guide, we are sharing everything we know about the current Coronavirus support for tradespeople.
The Impact Of Coronavirus On Tradespeople
The UK government are changing their advice and guidance in regards to the Coronavirus pandemic on a regular basis. They have moved all areas of the country from a tiered restriction system to another nationwide lockdown which could last for many more weeks as the vaccine is rolled out.
Once again, everyone is to stay at home with only a very limited number of exceptions. As most tradespeople cannot work from home, they are still permitted to go out to work. However, many customers are choosing not to have work at the moment. Similarly, tradespeople may not feel comfortable going into multiple households as the new variant of the virus is spreading more quickly.
Tradespeople such as plumbers, heaters and electricians work hard to serve their local communities. Many work across both domestic and commercial environments. Consequently, there are some serious implications of offering these services during the pandemic. Some considerations to bear in mind include;
- Personal safety and your own wellbeing: As a tradesperson, you are likely to be working in a range of different environments and coming into contact with many different people. You should always remember that it is your right to choose not to work in an environment if you feel like it is unsafe. You should remember that your own safety and wellbeing should always be your highest priority.
- The safety and wellbeing of your customers: As well as your own safety, you should also be considering your customer’s health. Guidelines state that if you or anyone in your household has symptoms of Coronavirus, then you must get a test and self-isolate. If you are contacted by NHS Test and Trace and have been in contact with someone with Coronavirus, you must also self-isolate.
- Insurance cover, including public liability: Many businesses are wondering if their insurance policies will protect them. Every insurance policy is different, but it is vital to look into your individual policies and consider the implications it could have on you.
- A Coronavirus Risk Assessment: It is now a legal requirement that businesses must complete a COVID-19 Risk Assessment. If your business has less than five employees, then it does not need to be a written assessment. A risk assessment must identify the risks of Coronavirus and the steps that can be taken to protect your customers, employees and yourself. Find out more about Coronavirus Risk Assessments here. The government have issued guidance on safely working outdoors, which can be found here.
Can I Claim On My Business Insurance?
Every business will have a slightly different insurance policy in place, and some may provide cover in the current situation.
A recent Supreme Court ruling is backing some small businesses to ensure payout for disputed business interruption claims. This may set a precedent for other insurance claims. However, it is important to carefully read your current insurance policies to see if you might be eligible.
Most business insurance policies do not cover Coronaviruses losses, despite including business interruption cover. This type of cover is to cover damage to business premises or equipment, such as by flood or fire. Many of these policies will not include cover for forced closure by authorities.
We recommend tradespeople to get in touch with their business insurance policy providers to determine if they have coverage.
What Support Is There For Tradespeople During The Coronavirus Pandemic?
With the information on the Coronavirus pandemic changing frequently, it is hard to keep up with the support that is available for tradespeople. We’ve compiled this list of everything currently available to small businesses and tradespeople. We will update this list with new information as it is available.
From January 2021;
In September 2020, Rishi Sunak announced the Winter Recovery Plan, which has since been updated to reflect the latest changes in the pandemic. As of January 2021, the support initiatives available for tradespeople are;
- Coronavirus Self Employed Income Support Scheme (SEISS) Extension: The scheme was due to end in November 2020 and has been extended to include a third and fourth cash grant. The third grant once again will cover 80% of average monthly trading profits, capped at £7,500. It will be one instalment which covers 1st November 2020 to 29th January 2021. Applications must be made by 29th January 2021. More information on the third grant can be found on the government website. The fourth grant will cover February to April 2021, and full details of this have not yet been released.
- Coronavirus Bounce Back Loan Scheme: This scheme helps SMEs borrow up to 25% of their turnover, at a minimum of £2,000 and up to £50,000. There is a Pay As You Grow option designed to help businesses repay the loan over 10 years as opposed to the 6 years which was offered initially. Businesses can also switch to an interest only payments for periods of 6 months, up to 3 times. There is also an option to pause repayments for 6 months if required, but terms and conditions apply. For application deadline for Bounce Back Loans has been extended to 31st March 2021. You can apply for this scheme through the British Business Bank.
- Coronavirus Business Interruption Loan Scheme (CBILS): CBILS is still available for businesses and applications are open until 31st March 2021.
- HMRC Time To Pay: HMRC is providing tax support for self-employed and businesses who are struggling to pay their tax bill due to Coronavirus. All businesses are eligible, and more information can be found here.
- VAT and Income Tax Self-Assessment Deferrals: Any VAT payments due between 20th March 2020 and 30th June 2020 were deferred until 2021/2022. The government has since announced on 24th September 2020 that there is a New Payment Scheme. Payments can be split to between 2 and 11 smaller, interest-free VAT payments up to March 2022.
- Coronavirus Job Retention Scheme: The Job Retention Scheme is in place for employees and businesses. The furloughing scheme has been extended until 30th April 2021.
As from the 26th March 2020;
On the 26th March, Chancellor Rishi Sunak announced measures to support self-employed workers. These measures were delayed due to being a complex process to calculate. However, from June there has been support for self-employed workers who have suffered a loss of income due to Coronavirus;
At the beginning of June, self-employed individuals who are eligible for a taxable grant were contacted by HMRC.
Eligible self-employed individuals are;
- Claimants where more than half of the household income comes from self-employment.
- Those with a trading profit less than £50,000 in the tax year 2018-2019 or an average trading profit of less than £50,000 for 2016-17, 2017-18 and 2018-19.
Self-employed people who have set up since April 2019 are not eligible for the taxable grant.
This also doesn’t cover directors of their own company. For directors, they will need to apply for the Job Retention Scheme.
Eligible individuals will be able to receive a taxable grant of up to 80% of the average profits from the three previous tax years. This will be up to a maximum of £2,500 per month for three months.
If you are eligible, HMRC will contact you and invite you to apply online. Do not apply to HMRC until you are invited to. At this stage, you will need to prove to HMRC that you have suffered financially as a result of the Coronavirus. Those who receive tax credits will have to declare this in the claim.
While the scheme offers a grant for up to three months (paid in one instalment), this may be extended if necessary.
You can find out more about support for the self-employed here.
As from the 20th March 2020;
On the 20th March, Rishi Sunak announced further measures to protect businesses. These included:
- Coronavirus Job Retention Scheme: Whether you are working as a tradesperson employed by a company or operate your own business and have employees to pay, the Coronavirus Job Retention Scheme can help. The government will support businesses by paying up to 80% of an employee’s salary, up to a maximum of £2,500 per month.
- Coronavirus Business Interruption Loan Scheme: This scheme was announced on 17th March but adjusted on 20th March to be interest-free for 12 months. This is a new loan scheme that is available for businesses with a turnover of £45 million or less. Organisations are able to borrow up to £5 million with no loan charges. This scheme became available on 23rd March 2020, and more information is available here.
- Income Tax And VAT Deferred For Self Employed: If you are working as self-employed with your own trade business, then you can benefit from deferred tax payments. Self-Assessment Income Tax bills due in July 2020 will be deferred until January 2021. The same goes for those businesses that are VAT Registered. You can postpone VAT payments from March 2020 to June 2020. There is nothing to do to make the most of these benefits, the government have already applied these changes automatically.
As from the 17th March 2020;
New measures were put in place to protect businesses throughout the Coronavirus outbreak. The Chancellor announced a new package of government-backed initiatives to support businesses. These included:
- Statutory Sick Pay: Small and medium sizes businesses are able to reclaim the costs of Statutory Sick Pay (SSP) for any employees who are sick because of COVID-19. Your business can claim a refund of up to two weeks SSP for each employee that is off sick or self-isolating due to Coronavirus.
- Cash Grants For Small Businesses: There are £10,000 one-off grants available to small businesses that experience disruption due to Coronavirus. They are available to any business that currently gets Small Business Rate Relief or has a rateable value of less than £15,000. More information is available on the government website.
- Benefits For Self Employed: Many self-employed tradespeople are unable to claim Statutory Sick Pay (SSP) from an employer, meaning they have no guaranteed income in the event of getting sick or having to self-isolate. The government are now allowing these individuals to claim either Universal Credit or Employment And Support Allowance.
The Minimum Floor Income for Universal Credit will be relaxed, meaning that those not working due to Coronavirus and government advice are able to claim. More details on Universal Credit is available on the government website.
Employment and Support Allowance is open to those who are self-isolating due to COVID-19, and you can claim £73.10 a week. More information on Employment and Support Allowance is available on the government website.