These unprecedented times will require unique and imaginative responses from all parties. Business are being impacted in a way that they never have been before. We are talking to businesses every day and assisting them at this difficult time. We are highlighting the supports that are in place, or are about to be introduced, to help businesses during the COVID-19 crisis. If you want to speak to us at any stage about how we might be able to help, then call us on 052 61 37775. Please feel free to share this AAL Covid-19 update with any other business owner that you might think would benefit from reading it.
Support for Bank Borrowers
The measures being introduced by the five main banks are as follows:
- Flexible arrangements, including a payment break for mortgages and other loans. Customers affected by COVID-19 must contact their bank to discuss the flexibility available to them, including the possibility of a payment break of up to 3 months.
- Extensive supports for SME customers – banks are working to ensure a wide range of credit, cash flow and supply chain supports are offered to businesses who are trying to manage the pressures arising from COVID-19. A deferral of up to 3-months on loan repayments will be of assistance to many businesses.
- The banks are adopting a customer-focused approach to these businesses with a wide variety of tailored supports including extensions of credit lines, risk guarantees, and trade finance.
- A simplified application process to make it as easy as possible for businesses to receive support from their banks.
- The banks want to ensure that any COVID-19 application for a payment break and further reviews will not adversely impact the customer’s credit record, and the banks reporting of these facilities. Banks want to avoid this and are meeting with the Central Bank of Ireland to urgently achieve a solution in this regard.
- Banks will also defer court proceedings for three months.
- The banking system stands ready to provide working capital support.
COVID-19 Supports from The Irish Government
On the 11th March 2020, the Department of Business, Enterprise and Innovation put in place a range of supports to help businesses navigate these uncertain times.
- A €200m Strategic Banking Corporation of Ireland (SBCI) Working Capital scheme for eligible businesses impacted by COVID-19. Loans of up to €1.5m will be available at reduced rates, with up to the first €500,000 unsecured. Applications can be made through the SBCI website
- A €200m Package for Enterprise Supports including a Rescue and Restructuring Scheme available through Enterprise Ireland for vulnerable but viable firms that need to restructure or transform their business.
- The maximum loan available from MicroFinance Ireland will be increased from €25,000 to €50,000 as an immediate measure to specifically deal with exceptional circumstances that micro-enterprises – (sole traders and firms with up to 9 employees) – are facing. Applications can be made through the MFI website or through your local LEO.
- The Credit Guarantee Scheme will be available to COVID-19 impacted firms through the Pillar Banks. Loans of up to €1m will be available at terms of up to 7 years. The scheme provides an 80% guarantee to participating banks which are AIB, Bank of Ireland and Ulster Bank.
Other Enterprise Ireland/Local Enterprise Office supports include:
- Strategic consultancy grant for SME’s to assist the company development of a strategic response plan.
- Act On Initiative, providing access to 2 days consultancy engagement at no extra cost to assess Financial Management, Strategic sourcing and transport and logistics advice.
- Key Manager Support to provide partial funding towards the recruiting of a Full or Part Time Manager with critical skills for future growth.
- Agile Innovation Fund and Operational Excellence Offer.
- Be Prepared Grant for contingency planning.
- Vouchers for business continuity preparedness, innovation and productivity will be available through Local Enterprise Offices in every local authority area.
- Additional financial supports are available locally through the 31 Local Enterprise Offices.
Pandemic Unemployment Payment
The €203 payment is only for employees or self-employed who are out of work due to COVID-19. No other payments are made by the employer to the employee for the applicable week(s) and all temporarily laid off employees receive the €203 per week.
The government are going to reimburse any employers that pay the €203 per week pandemic unemployment payment on a next day basis. Employees should be paid through the payroll system (Employers should contact their payroll software providers for assistance in respect of payroll to be processed under this scheme.) and Employers or their agents can apply through MyEnquires on Ros for the refund. Any Income Tax and USC refunds that arise as a result of the application of tax credits and rate bands can be repaid by the employer and this amount will also be refunded to the employer.
The employee must confirm to the employer that they have not, and will not, claim a payment from DEASP whilst the employer makes this payment through the payroll. Employers will be asked to advise employees to make a Jobseeker’s Benefit claim via the MyWelfare.ie online portal (so that the employee(s) can access qualified dependant payments if appropriate).
If their Employer is not in a position to pay the €203 per week Employees can apply directly to revenue.
The payment has a simple one–page application form and will be paid for a period of 6 weeks at a flat rate payment of €203 per week. COVID-19 Pandemic Unemployment Payment.
If you need to reduce an employees’ hours to 3 days or less per week from their normal full-time hours, they can apply for a payment called Short Time Work Support which is a form of Jobseeker’s Benefit.
Revenue have introduced a number of measures to assist businesses with Cashflow difficulties as a result of COVID-19
- Application of Interest
The application of interest on late payments of tax liabilities is suspended for January/February VAT and both February and March PAYE (Employers) liabilities.
- Debt Enforcement
All Revenue debt enforcement activity is suspended until further notice.
- Tax Clearance
Current tax clearance status will remain in place for all businesses over the coming months.
Minister John Paul Phelan has secured Cabinet approval for the introduction of a two-month break in Commercial Rates for businesses across the country with a provision to review the timeline at end of two-month period.
Non- Bank Lending
- Non-bank mortgage lenders and credit servicing firms will offer the same three-month payment break for mortgage customers who are impacted by the fallout from the COVID-19 pandemic.
- They will also defer court proceedings for three months.
AAL is ready to provide you with quick and up to date advice to all your Banking, Working Capital, Cashflow, Tax and Employee queries.
Call AAL now on 052 6137775 or complete the form and we will get back to you.
Covid-19 Resources from AAL
What Employers Need To Know About Covid-19
The unprecedented health emergency that is Covid-19 has brought about decisive actions from governments around the world. In Ireland, a number of schemes have been introduced to assist employers and the self-employed. We look at the details of those schemes in this article. Read the article by clicking this link.
Covid-19 & Your Business: What To Do
The Covid-19 outbreak is first and foremost a human tragedy, affecting hundreds of thousands of people. It is also having a growing impact on the global economy.
As the outbreak continues to spread, businesses are preparing for possible impacts on their operations.
Read the article by clicking here.
It’s Time To Start Thinking Differently
In times of disruption or crisis, novel circumstances abound. Understanding the contours of what is happening and what is most likely to happen next can be the difficult piece, especially if you are a traditional thinker.