Important information for Directors of limited companies

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On Thursday the Chancellor laid out further details on support for businesses and individuals affected by the COVID-19 pandemic.

This most recent guidance only applies to the self-employed (i.e. sole traders and partners of partnerships).

It is important to note:

  • It does not apply to directors of their own limited companies.
  • The only comment we have so far from the government is “Those who pay themselves a salary and dividends through their own company are not covered by the Self-Employment Income Support Scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes”.

We understand that many of our clients have questions, some of which we have answered below:

  • Q: Can we furlough ourselves and claim 80% of our salary?
    A: The answer is we believe (hope) so, though how feasible it is for a director to furlough themselves remains to be seen.
  • Q: How do we apply to do this?
    A: There will be an online portal for the Job Retention Scheme, but we don’t have further details at the moment.
  • Q: What else can we do?
    A: The government has created a Coronavirus Financial Support website which gives details on all support offered currently to businesses. We suggest that you also request a 3 month payment holiday on mortgages and any other personal borrowing.

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