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Cowgills Coronavirus client Q&A summary – 30 March

On the 30th March we held a Q&A session for clients through Zoom and were delighted to welcome over 40 attendees.   Guests were able to hear from a panel of experts at Cowgills.

The team helped to demystify the current package of help from the Government and provided some valuable information and advice to assist business during this turbulent time. Our thanks also to Robert Maddocks of Bermans who provided his insight from an employment law angle.

We have provided a summary of some of the key topics that were discussed.  We will be holding future events for clients and contacts, do drop us a line if you would be interested in attending enquiries@cowgills.co.uk

Summary of the items discussed.

Wrongful trading and the insolvency regime

Changes to insolvency regime have been backdated to 1 March for three months. Wrongful trading provisions have been relaxed for three months.

Relaxation of these provisions does not change the duties of Directors who must be mindful of these when continuing to trade especially in the event that the company subsequently fails in a relevant period.

There will be checks and balances so it should not be seen as a free pass for Directors to just make poor financial decisions.

Wrongful trading gives comfort that you can make decisions as a Director however, please be careful, document them all, pay only what you can justify.

Tax, VAT etc

VAT payments for March and April have been deferred, payable at the end of 2020/21 tax year. Ensure you put your return in, but don’t pay.

There is a new HMRC helpline number 0800 0241222. Since the call this morning, we have received information that HMRC have recruited a number of people to deal with the influx  of calls and it is now very easy to contact them.

Cancel DD’s for VAT otherwise you will find yourself trying to get it back.

Don’t pay your PAYE, keep on the line to HMRC until you get through and get an agreement. HMRC want to see you are showing willing.

Corporation tax is a little different and is not specifically referred to, however now is the time to get the best deal. Call them to discuss.

If you call up and can get through, what are you asking for an email or letter what confirmation would you require?

HMRC will send a letter in the post but ask for an email to receive a quicker response.

Also, Corporation Tax OIPS payments are being repaid if you think your CT will be lower than estimated.

We are also assisting clients with other measures to get cash into the business – R&D tax credits, look to accelerate those claims.

Look at shortening your year end. For R&D, HMRC operate a file now check later, so if you get that claim in they will pay it to you.

Capital allowance claims are also something to consider to get cash into the business.

If you have assets in your business that are valuable such as property/ surplus cash and you have a holding company, on the provision that the business is solvent, you may want to consider transferring these up to your holding company. This is good practice anyway even when we’re not in a crisis, to protect assets and ring fence risk.

Think about other measures to keep cash in your business rather than with HMRC – we can assist if you require further details.

Furloughed Workers

Employees need to be furloughed for a minimum period of three weeks.

This provision to claim a contribution to staff costs will be in place for a minimum three months.

You are able to furlough workers for the whole period or for part of it and you can rotate the workforce (with reference to the three week minimum). During that furloughed period employees cannot work or undertake any activities that lead to revenue generation. But employees can do training and volunteer within this time.

Employees still accrue holiday pay and other benefits during their furlough period.

When employees return to work, they can carry over a maximum of four weeks of holiday to take over the next two years.

It is best practice to write to staff to let them know they are being furloughed. Employers also need to set out whether they are topping up the furloughed amount received by the government (of 80%).

If they reject the offer, the alternative option is redundancy.

Even zero-hour employees can be furloughed. The determinate is that the individual is on the payroll.

The HMRC portal to claim the rebate will not be ready until the end of April.

If you are struggling with cashflow before that, speak to your current lender initially.

Is it possible not to pay staff until that money comes through?

 Not without their agreement. Unless your employees agree for you not to pay until this date you have to stick to contractual terms.

Should we pursue a Business Interruption Loan while we wait for furlough?


If under 250k or turnover less than 2m it’s a straightforward process. They are factoring in the fact that you will get your payroll in at the end of the month so might only roll payroll into one month.

Business Interruption Loan

Is the Business Interruption Loan ready?

 A client did get approved on Friday and the money will be in their bank tomorrow so it is available.

There are mixed signals from different banks, so speak to yours to see where they are at.

It isn’t a one size fits all product; it needs some level of human underwrite. It is supposedly an easier process if applying for less than £250k and business turns over less than £2m.

Banks are not used to making quick decision, so this is new to them too. When you apply for a loan they want to know what you are using it for.  It can’t be used to refinance existing debt.

Personal guarantees – all banks on a case by case. Some aren’t asking for them regardless of the size, HSBC were over £100k, Lloyds were on all but backtracked, Santander are. This is changing on an hourly basis we’ll try and keep you updated on this.

Look at repayment holidays, most are doing this.

What is clear is that you have to have the preparation done before applying for these loans.

  • Cashflow forecasting model – you will receive better terms from the bank if you have a cashflow
  • A bank will want you to prove viability pre and post Coronavirus and the steps you’ve made in the interim – The Cowgills team have been building this model and  we can roll it out quickly for clients. It is simplified down so you have a tool to use and update yourselves.
  • Basic set of forecasts, the historical viability of the business to show how the businesses financial performance will track during Coronavirus, including the steps taken will be critical for the
  • Relatively simple business plan will also need to put together which we have a template we can

Getting the longest capital repayment holiday, security and low interest cost are the key areas of negotiation. If you wait another week it will have settled down so you might be able to get a better deal as we’ll gather more intelligence in the market. This will also allow more time to thoroughly prep.

Banks are non-stop getting applications through from their clients, those at the front of the queue are the ones with the info prepared properly hence will get a quicker response.

Should you require any further assistance do not hesitate to contact us .


The information was correct at time of publishing but may now be out of date.

Posted by Cowgills
31st March, 2020
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