Revised Coronavirus Business Interruption Loan Scheme (CBILS)
The Government has announced significant revisions to the Coronavirus Business Interruption Loan Scheme (CBILS) that come into effect from Monday 6 April 2020, opening up the scheme to a wider range of businesses.
The Scheme provides UK-based SMEs with turnovers of up to £45 million access to facilities of between £1,000 and £5 million interest-free for 12 months, backed by an 80 per cent guarantee from the Government.
However, until now, CBILS has only been open to businesses that were unable to access a facility on normal commercial terms.
HM Treasury has now confirmed that from Monday 6 April 2020 any businesses that meet the main criteria must be considered for a CBILS facility, even if they would otherwise qualify for a commercial facility.
Am I eligible?
The British Business Banks says that businesses that meet the following conditions must be considered for CBILS:
- Be UK-based in its business activity
- Have an annual turnover of no more than £45 million, of which more than 50 per cent is generated through trading activities
- Have a borrowing proposal which the lender would consider viable, were it not for the current pandemic
- Self-certify that it has been adversely impacted by the coronavirus (COVID-19).
Full details of eligibility and an FAQ link to the British Business Bank can be found here.
What finance can I access?
Funding can be in the form of loans, overdrafts, invoice financing or asset finance, although each lender will be able to choose which elements of the scheme it supports.
Facilities are available from £1,000 to £5 million, subject to a lender’s criteria. CBILS will be interest-free for the first 12 months, as the Government has guaranteed to cover these payments during this period.
The Government and the British Business Bank, which is helping to administer CBIL, have confirmed that no setup fee will be charged.
Am I liable for all of the debt?
The borrower will remain 100 per cent liable for the debt. An 80 per cent guarantee offered by Government is simply to provide some recourse for the lender in the event of a borrower defaulting on their debt.
Do I need to provide a personal guarantee?
The British Business Bank has confirmed that the lender can only require personal guarantees for facilities of £250,000 or more. However, where personal guarantees are required:
- they exclude the Principal Private Residence (PPR), and
- recoveries under these are capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied
I’ve previously been turned down for a CBILS facility because I qualified for a commercial loan, can I re-apply?
Yes, the British Business Bank is encouraging businesses in this situation to contact their lender again following the change in the rules.
How do I apply?
The scheme will be delivered through existing commercial lenders, backed by the Government-owned British Business Bank. There are currently 40 accredited lenders able to offer the scheme, but more are being added regularly.
These are the steps that you should take in applying for a loan:
- Decide which form of finance you require and identify which accredited lenders can offer it. This can be done by using the British Business Bank’s filter tool by clicking here.
- This filter allows you to put in the region where your business is based and the type of loan you require and will provide you with a list of suitable lenders.
- Research what each lender is offering via their website and decide how much funding you require.
- Collate all necessary information to make an application, including an up to date business plan, cash flow forecasts, business plans, historic accounts and details of assets.
- Make an application with your chosen lender that suits your requirements. The loan application process is likely to differ from lender to lender.
The British Business Bank has indicated that it may be beneficial to seek finance first through a lender that you have an existing relationship with.
To help you with this process we have prepared a helpful infographic, which can be downloaded and shared.
- Coronavirus Future Fund opens to applications
- Coronavirus Statutory Sick Pay Rebate Scheme set to open for claims
- Maximum Government-backed loan amount for larger businesses increased to £200 million
- Temporary tax freeze on home office expenditure announced
- Tax treatment of expenses and benefits during COVID-19
- Money laundering supervision payment deferrals and deregistration announced by HM Revenue & Customs
- Changes to notifying an option to tax (VAT) on land and buildings during the Coronavirus pandemic
- COVID-19 – Re-build and recover – we’re here to help you get back on track
- New start-ups
- Owner Managed and Family Businesses
- Cashflow projections and budget assistance
- Tax payment plans
- R&D Tax Credits
- Dividend Tax Planning
- Inheritance Tax
- Business Advisory Services
- Contracts & Agreements
- Assistance with business plans and pricing reviews
- Payroll & HR advice
- Practical Employment Law Considerations For Returning to Work
- Employment contracts – changes to package and benefits
- Furlough – continuation and return to work
- Business Finance
- Loans and other methods of finance
- Property Owners
- COVID-19 – An assessment of safe working arrangements
- Coronavirus Job Retention Scheme (CJRS) extended until October
- “Covid Secure” practical workplace guidance for employers
- Get ready to claim the Self-Employment Income Support Scheme (SEISS)
- Eligibility for grant funding
- Government reduces the penalty for Lifetime ISA withdrawals
- Bounce Back Loan scheme is now live – apply today
- Deferring your VAT payment
- Bounce Back Loans scheme for small businesses
- Businesses bombarded by cyber-attacks as they seek support for COVID-19
- Child Benefit and the High-Income Child Benefit Charge during the coronavirus outbreak
- Coronavirus Statutory Sick Pay Rebate Scheme
- Coronavirus Customs Authorisations
- Are you or your team classed as essential workers?
- Payment of dividends during the Coronavirus outbreak
- Certain sectors see access to the Coronavirus Job Retention Scheme restricted
- Are you eligible for the Self-Employment Income Support Scheme (SEISS)?
- I’m a director of a small company – what support is open to me during the Coronavirus outbreak?
- Government launches Business Support Finder tool
- Government announces Future Fund for fast-growing businesses
- Administering the Coronavirus Job Retention Scheme
- Coronavirus Job Retention Scheme online portal launches
- Statutory Residence Test changed to allow skilled workers from around the world to assist the UK’s Coronavirus response
- Government SEISS guidance updated
- Coronavirus Job Retention Scheme extended to end of June
- Expanded Coronavirus Large Business Interruption Loan Scheme (CLBILS) launched
- How total income and trading profits will be calculated for the Self-Employed Income Support Scheme
- Coronavirus Job Retention Scheme (CJRS) cut-off date extended to 19 March 2020
- Accounting for grant payments
- CGT reporting of property sales to be given more time
- Four new Coronavirus Business Interruption Loan Scheme (CBILS) lenders announced
- Detailed guidance published on the Self-Employed Income Support Scheme
- OBR warns that the UK economy may contract by more than a third before bouncing back by end of 2020
- Easter Weekend updates to the Coronavirus Job Retention Scheme
- Coronavirus Job Retention Scheme – Portal opens Monday 20 April 2020
- The Coronavirus Large Business Interruption Loan Scheme (CLBILS)
- Latest amendments to the Coronavirus Job Retention Scheme announced
- Personal loans, credit cards and overdrafts
- Revised Coronavirus Business Interruption Loan Scheme (CBILS)
- Take care – Coronavirus fraud on the rise
- Government updates guidance on small business and retail sector grant schemes
- Government confirms that furlough rules do not leave employers at risk of breaching minimum wage rules
- Newly appointed staff members will not benefit from the Coronavirus Job Retention Scheme
- Coronavirus support for people working through their own limited company
- Holiday rules relaxed to allow annual leave to be carried over to next two years
- Suspension of director liability for wrongful trading
- Soft-landing period for MTD for VAT extended to April 2021
- The Coronavirus Jobs Retention Scheme and employers’ National Insurance and Pension contributions
- What expenses are taxable when working from home?
- Preparations Checklist
- Coronavirus Business Interruption Loan Scheme (CBILS)
- Business rates relief extended
- Layoffs owing to reduced work
- Coronavirus Self Employed Income Support Scheme (SEISS)
- Tax and Companies House Deferrals
- Companies House Filing
- Personal Finances
- Working from home
- Commercial Rent Deferrals
- Coronavirus Job Retention Scheme Guidance Published
- Coronavirus Self Employed Income Support Scheme (SEISS)
- Accessing the Coronavirus Job Retention Scheme
- Important Message to Clients and Friends
- Payroll professionals confirmed as key workers
- Accessing the latest COVID-19 stimulus
- Inn Control Here to Help
- COVID19 - Further Update
- COVID19 Update: 18 March 2020
- COVID-19: Government Measures to Assist Small Business Experiencing Financial Hardship
- Budget 2020
- Entrepreneurs’ Relief changes expected in March Budget
- Get ready for a range of tax changes this April
- VAT zero-rating now applicable to businesses e-publications
- Latest case highlights the dangers of not meeting workplace pension requirements