The measures will help prevent businesses unable to meet debts due to the coronavirus from being forced to file for bankruptcy while they explore options for rescue or restructure.
The measures include:
- A moratorium for companies giving them breathing space from creditors enforcing their debts for a period while they seek a rescue or restructure;
- Protection of their supplies to enable them to continue trading during the moratorium; and;
- A new restructuring plan, binding creditors to that plan
The proposals will also include key safeguards for creditors and suppliers to ensure they are paid, while existing laws against fraudulent trading and the threat of director disqualification will continue to act as an effective deterrent against reckless misuse of these new measures.
The UK’s Insolvency Framework’s restructuring tools will mirror the USA’s Chapter 11 procedure, a well-established model adopted by countries around the world.
The Government is working to roll out the measures as soon as possible.
Wrongful trading provisions
Included in the insolvency measures will be the temporary suspension of the wrongful trading provisions to give company directors greater confidence to use their best endeavours to continue to trade during the coronavirus emergency, without the threat of personal liability, should the company ultimately fall into insolvency.
Find out more about the insolvency measures here.
Further details of Coronavirus Job Retention Scheme announced
The new guidance published late last week added clarification that employers can claim for 80% of furloughed employees’ (employees on a leave of absence) usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage. Employers can use this scheme anytime during this period. Guidance for employers on the Coronavirus Job Retention Scheme can be found here while guidance for employees can be found here.
Regulations eased to ensure hand sanitiser and PPE reaches NHS staff more quickly
By easing regulations, new suppliers and businesses that produce ingredients for hand sanitiser will be able to bring their products to market in days. Government is easing administrative requirements and barriers to imports without compromising on safety.
The self-employed can also get support from
- Access to coronavirus business interruption loans.
- Income tax payments due in July can be deferred to the end of Jan 2021.
- Changes to the welfare system to allow access Universal Credit in full.
- Anyone who missed the tax return filing deadline in January, have a further four weeks from today to submit their tax return.
Government launches Coronavirus Information Service on WhatsApp
The UK Government has launched a GOV.UK Coronavirus Information service on WhatsApp. The new free to use service aims to provide official, trustworthy and timely information and advice. To use the free GOV.UK Coronavirus Information Service on WhatsApp, simply add 07860 064422 in your phone contacts and then message the word ‘hi’ in a WhatsApp message to get started. Further information can be found here.