23 
Mar

Covid19 and Catering Businesses

covid19 and catering businesses help

No one needs telling that we’re living in desperate times when the government orders the closure of catering businesses.

Those who are offering a takeaway or distribution service are currently exempt.

But when the likes of MacDonalds, Costa and Nando’s voluntarily decide to close to protect staff; it’s time to see what has been put in place already for Covid19 and catering businesses.

Government Specific Help for Catering Businesses

Following the Chancellor’s announcements there is some useful information on covid-19 support on the government’s pages . Check this out for the latest info and updates.

The government’s interventions are primarily about continuity so that when the crisis ends pubs, restaurants, hotels, mass catering and leisure facilities are still around to begin trading again.

The first is for staff under the Coranavirus Job Retention Scheme. Here a grant will cover 80% of retained but non-working employees pay. This is capped to a monthly salary of £2,500 equivalent to £30,000 pa. It’s backdated to March 1st and will in the first instance run for 3 months to the end of May. It could be extended. Now is a good time to have an open and honest conversation with staff about balancing pay and a future job. And then getting a grant for the majority of that cost.

The Coronavirus Business Interruption Loan Scheme focuses on the business who turns over under £45M. This provides a government-backed guarantee for 80% of the loan amount. The government will pay the first 12 months interest. The maximum term of the loan is 6 years.

Here the government is enabling catering business to access loans where previous the answer would be no and giving an interest holiday. The full loan amount will need to be repaid. Consider what essential items could benefit from being covered by a loan; and then how you would be able to pay it back from 2021.

Covid-19 Tax and Reclaim Breaks

With immediate effect, all VAT is deferred to the next quarter so the next payment date for any outstanding is the end of June. But treat this carefully as the VAT will need to be paid at that time. And with limited or no income coming in, it will be difficult to replenish that pot.

If you are having tax payment difficulties, the best advice is to call 0800 0159 559 to discuss the Time to Pay scheme. Do this at the earliest opportunity, not at the last minute.

If staff are unfortunate to catch Covid-19 then with an isolation note from NHS111online, as an employer you can reclaim 2 weeks statutory sick pay.

Local Authority Support for Covid19 and Catering Businesses

Some catering businesses have opted to provide or expand their takeaway meals services. This is a good way to liquidate stock or to maintain limited supply from key suppliers. Some local authorities have been quick with suitable advice such as Monmouthshire .

More significantly there are a number of business rate measures that will be enacted by your local authority. These require no action on your part. Business rates for those in hospitality, retail and leisure have been abolished for the Tax Year 2020-2021. A new statement will be issued by your local council.

Local councils will also administer the Retail and Hospitality Grant Scheme and notify you directly. This is based upon rateable value:

  • If your rateable value is up to £15,000 you can get a cash grant of £10,000
  • For those between £15,001 and £51,000, the grant is £25,000
  • Farm shops and micro businesses are not left out. If you are in receipt of Small Business Rate Relief or Rural Rate Relief; there is a one-off grant of £10,000.

Cashflow is King

For catering businesses cashflow has always been king. Now more than ever, owners and managers need to look very carefully at their budgets and costs. Work out what is necessary, deal with people honestly and respectfully and access what is available to help for covid19 and catering businesses.

At AC Services Southern we look forward to working with you in any way we can; so that your business can revive when this crisis is over.

Published Date: 23rd March 2020
Category: Blog, Catering Business, News
Tags: , , , , ,

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