Dividends are still not included in any support scheme. However there is renewed pressure from business leaders and trade bodies to provide limited company directors with financial help, so watch this space.
In the meantime if alongside the dividends you receive, you pay yourself a salary taxed under PAYE, the Coronavirus Job Retention Scheme (CLRS) allows you to claim 80% of earnings up to £2,500 per month. This is the case even if you are the only employee. You will be furloughed so cannot undertake work for your own company, but the rules do allow you to perform your statutory obligations as a director, and with the minimum furlough period being set at three weeks there is flexibility. You can apply now through the furlough scheme claim portal. If your trade allows, another option is to furlough and consider freelance or consultancy work. If you are really struggling you are likely to be eligible for universal credit – apply at www.gov.uk/apply-universal-credit.
You will want to take any action you can to ensure your business remains a going concern. The first step should be to look at the Small Business Grant Fund and Retail, Hospitality and Leisure Grant Fund. In addition the recently announced Bounce Back Loan scheme may be available to you from 5th May, (more information can be found at www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan).
The loan is aimed at small businesses and you can borrow between £2,000 and £50,000. The money can be used to support cash flow, with no fees or interest charged in the first twelve months. Your accountant should be able to provide further direction around the range of grants and loans available. Now would also be a good time to speak to creditors around deferring repayments, or suppliers with regards to restructuring arrangements.
As part of a wider financial review it could be possible to make a loan to your company from any pension arrangement you have in place. You can also access Pensions (if you are aged 55 or over) or investments to meet short term income needs. There are though a range of factors to consider before doing so, so to discuss, call or email on the details below.