Financial Support Measures for Barristers
As a self-employed barrister, it is likely that you are concerned about the current uncertain situation.
These are troubling times, and we would like to assure you that Jack Ross will be here to offer as much information as possible to allow you to manage your finances.
The government have announced a list of measures that could be beneficial to self-employed barristers and chambers (that is, either chambers operating as unincorporated Trade Protection Associations (TPA) or through incorporated limited companies).
We will update this list as the situation develops and more information comes to light.
Please see the Government guidance on Support for Business and the links therein for further information.
The Bar Council is urgently seeking confirmation from HM Treasury on the eligibility of the Bar for those measures where eligibility is currently unclear. This specifically refers to self-employed barristers and/or those chambers operating as unincorporated TPAs, and whether these qualify as ‘businesses.’
Income tax payments for the self-employed are deferred
Self-assessment payments due on 31 July 2020 will be deferred until 31 January 2021. This is automatic and you do not need to apply. No penalties or interest for late payment will be charged in the deferral period
VAT payments for businesses are deferred for three months
Businesses will not need to make a VAT payment between 20 April and 30 June 2020. Taxpayers will be given until the end of the 2020/21 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.
Further tax-liability support for businesses and the self-employed through the HMRC Time to Pay scheme
Further to the measures above, all businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support, agreed on a case-by-case basis and tailored to individual circumstances and liabilities. Phone the HMRC’s dedicated COVID-19 Time to Pay Helpline on 0800 0159 559
Take a “mortgage holiday” of up to three months
Contact your mortgage provider to arrange this.
Discuss chambers’ property rent liabilities with your landlord
Discuss with chambers’ landlord to discuss the possibility of postponing all or part of your property-rent payments. The Bar Council has contacted the Inns to encourage their consideration of such requests.
Reclaim the costs of Statutory Sick Pay paid to employees
The Government is bringing forward legislation to enable employers to reclaim the costs of SSP paid for sickness absence, covering up to two weeks’ SSP per eligible employee who has been off work due to COVID19. Further details of this will be provided once the legislation has been passed.
Borrow through the Business Interruption Loan Scheme
This temporary scheme will be launched in the week of 23 March 2020 and will be available to small and medium-sized businesses. (Please see the comment on the term “businesses” regarding eligibility at the start of this page.) Loans of up to £5M will be available, with the first 12 months of the loan being interest-free. The full rules of the Scheme are available on the British Business Bank website. Talk to your bank or finance provider (not the BBB) as soon as possible and discuss your business plan with them. If you have an existing loan with monthly repayments, you may want to ask for a repayment holiday to help with cash flow.
Receive a grant of £10,000 if you are eligible for Small Business Rate Relief
If the rateable value of your one business property (i.e. its open market rental value on 1 April 2015, based on the estimate by the Valuation Office Agency) is £15,000 or less, you will already be eligible for SBRR. This could apply to a few sole-practitioners or very small chambers with one business property and already in receipt of SSBR. Your local authority will contact you to provide a one-off grant of £10,000; you do not need to apply.
Check if you can claim on your existing Business Interruption Insurance
Chambers should check their existing business insurance to see if it provides relevant cover, e.g. Business Interruption arising from pandemics, though please note that the Association of British Insurers has advised that this is not standard cover. See the ABI’s statement here. Seek advice from your insurance broker as appropriate and pay attention to any time limits in the policy. Also check to see if your policy includes cover for government-ordered closure, in case the Government should subsequently order businesses (including barristers’ chambers) to close.
Claim under the Coronavirus Job Retention Scheme
All UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis. HMRC will reimburse 80% of such “furloughed” workers’ wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. See the Government’s Support for Business document for further information.