Government Coronavirus Support for Charities - PKF Francis Clark
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Government Coronavirus Support for Charities

After much concern from the charity sector over recent weeks of the impact of the Coronavirus pandemic, the Chancellor has announced a £750m package to assist charities.

Many charities have been hit by a significant reduction in income as charity shops have been forced to close and fundraising events have had to be cancelled, whilst at the same time seeing an increased demand from their beneficiaries for help and support.

Until the recent announcement, the main government support available to charities was primarily limited to:

  • Coronavirus Job Retention Scheme, providing a grant to cover 80% of the usual monthly wages costs of employees who have been furloughed, up to £2,500 a month, plus the associated Employer NI contributions and Automatic Enrolment contributions
  • Coronavirus Business Interruption Loan Scheme for small and medium businesses where the government can provide lenders with a guarantee of 80% on each loan. However charities are only eligible if over 50% of income is from trading activities, meaning those charities reliant on grant funding and donations are going to be ineligible
  • Business rates relief in the retail, hospitality and leisure sector, which may assist those charities with shop
  • Deferral of VAT bills for VAT registered charities

Whilst the new package will fall far short of replacing all the income the charity sector has, it has still been welcomed by the sector and will help to protect the vital work that charities are currently carrying out on the front line.

In particular the £750m package includes:

  • £360m to be directly allocated by government departments to charities providing key services and supporting vulnerable people in the crisis

 

  • £370m for small and medium sized charities, including through a grant to the National Lottery Community Fund, which will support local charities providing support during the outbreak (such as those delivering food, essential medicines and financial advice)

 

  • A pledge to match fund whatever is donated by the public to the BBC’s Big Night In appeal (on 23 April) starting with at least £20m to the National Emergencies Trust appeal

 

We understand that government departments are currently working to identify recipients for the £360m fund with the aim to provide the money in the coming weeks.  Recipients are likely to include Hospices, victim and domestic abuse charities, vulnerable children charities, Citizens Advice and St Johns Ambulance.

The application system for the National Lottery Community Fund is also being established and is expected to become operational over the next few weeks.

In addition the government is maintaining a specific Coronavirus guidance webpage for the charity sector at:

https://www.gov.uk/guidance/coronavirus-covid-19-guidance-for-the-charity-sector#government-financial-support-for-charities

As well as providing details of government support, this also sets out other relevant points for charities including how they can help with the coronavirus efforts and addresses practical points such as holding meetings online and the updated Charity SORP guidance.

We will keep our blog and charity FAQs updated as further information and detail on this funding is announced.  However, if you do have any queries that we can help with, then please do get in touch.

FEATURING: Darren Perry
Darren Perry ACA DChA is a director of the firm, based in the corporate department of our Truro Office. He has specialist expertise in the… read more
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