July 1 has seen major changes to the support given to businesses affected by the Covid19 pandemic. Employers using the furlough scheme will now have to pay increased proportions of staff wages. Employees will still receive still 80%, wages the government paying 70% and employers face with the cost of the remaining 10%. August 1 sees employer contributions rise to 20%, government support coming to an end at the end of September. BBC News reports that at the end of May 2021. 2.4 million workers were still being supported. What will happen in the coming weeks?
In addition, the stamp duty holiday will start to be wound down, business rates holiday becomes less generous and delayed payments for VAT will restart. One piece of welcome news is that regulations will be laid that will mean restrictions on statutory demands and winding up petitions will remain until 30 September to protect companies from creditor enforcement action where debts relate to the pandemic.
As previously reported, formal insolvency processes, such as liquidation, administration, (pre-pack or otherwise) and voluntary arrangements entered into have been low since lockdown began 18 months ago. It now remains to be seen how these planned changes affect companies and the individuals they employ, with problem likely to be most acute, and perhaps unfair, in sectors such as travel and hospitality where current government restrictions actually prohibit or limit trade.
If, as news items often say, you are affected by these issues, professional help is available. Do not hesitate to call us free advice on both informal and formal insolvency work, including:-
Business Assessment & Restructuring, New Funding Options, Creditor negotiation and time to pay arrangements, Company and Individual Voluntary Arrangements (CVAs & IVAs), Administration, Liquidation, Bankruptcy.
Please call 01282 332222 or email firstname.lastname@example.org for a confidential chat to receive practical advice.
Source: BBC News