To ask the Chancellor of the Exchequer, what steps he is taking to support business directors that have taken on debt as a personal liability to cover costs incurred as a result of the covid-19 pandemic.
17 March 2021
The Government has provided over £407 billion in total fiscal support throughout this crisis to protect people’s jobs and livelihoods, and to support businesses and public services across the UK.
Business directors who pay themselves a salary through a PAYE scheme may be eligible for the Coronavirus Job Retention Scheme (CJRS), which has been extended to the end of September. However, some directors pay themselves in large part through dividends, while taking a small salary. Dividends are not covered by this scheme nor by the Self-Employment Income Support Scheme (SEISS) because income from dividends is a return on investment in the company, rather than wages. Under HMRC’s current reporting mechanisms it is not possible to distinguish between dividends derived from an individual’s own company and dividends from other sources.
However, business directors can benefit from several other elements of the Government’s support package. Business directors are able to benefit from the Government’s support for businesses, which includes grants, a moratorium on commercial evictions, and government guaranteed loans. The Government has also boosted the generosity of the welfare system through a temporary £20 a week increase in the Universal Credit standard allowance and has announced a one-off payment of £500 in April to eligible Working Tax Credit claimants across the UK. The Government has also increased the Local Housing Allowance rates for Housing Benefit and Universal Credit, enhanced Statutory Sick Pay, and is providing council tax support through local authorities.