Will SME directors get an early Christmas present?
This week millions of entrepreneurs currently locked out of Covid financial support may finally be given help.
Today (9 December) the Treasury will discuss a support plan (DISS) for those company directors who rely on dividends for their income. Will the government’s frosty resistance melt? And could a state-backed grant save 3 million small limited companies in time for Christmas?
Is DISS fraud proof?
So far, the state has steered clear of supporting SME directors, citing the difficulties in separating company income and passive income on the balance sheet. However, the proposed grant, covering three months, (80% of average earnings, up to £7,500) would rely on the data already provided to HMRC. And it would be paid directly into company accounts to mitigate the risks of fraud.
It’s worth mentioning that the cost of the proposed DISS scheme to the taxpayer is estimated between £2 billion and £6 billion.
It would be cheaper than the £7 billion it cost for the first three months of the SEISS. Moreover, it’s not just about providing support to the company directors. SMEs are responsible for creating 7.5 million jobs, and without immediate help, the long term cost of the economic scarring may be much higher.
With local and global economic turmoils ahead, any business should be encouraged to test-stress their finances and to seek professional help earlier.
If your business is facing financial difficulties, and you would like to know your options, contact us for free impartial advice on ☎️0800 118 2948.
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