One-man-band director companies with no employees - no COVID-19 support?

Model500

It would appear that small one-man-band limited companies with no employees are not catered for under the COVID-19 support measures.

The reasoning being that it is more or less impossible to have a company running without some kind of work going on, i.e. at minimum background admin work. Directors in this instance couldn't furlough themselves as an employee even if there was an employee contract in force due to continuation of work.

Have I understood this correctly?

PhilHallAAT

The self-employed scheme is certainly a non-starter, indeed HM Treasury guidance states, “…those who pay themselves a salary and dividends through their own company” are NOT covered by the self-employed support scheme.

However, they can apply to have the salary element of their pay covered by the Coronavirus Job Retention Scheme (CJRS) so hopefully that is of some help.

I appreciate there will be some concerns about furloughing but HM Treasury has confirmed that owner-directors can apply to “furlough” 80 per cent of the PAYE element of their income via this CJRS job retention scheme for salaried staff and still continue to perform their statutory obligations as company directors (filing accounts etc.) providing that is all they are doing.

Hope that's of some help.

MichaelBeechFMAAT

I suppose the other option for those OMB (Dividends route mainly with perhaps a LEL Salary of £719 or similar) is loans route of interest free backed by Govt for 12 months. I guess if it helps those OMB to stay afloat the name of the game is survival at this stage. Two elements it would seem: keep a roof over your head and food, but also keep your Goodwill/ Brand intact and come out as a Ltd the other side. Loans would always be a last resort for exceptional circumstances and to be used sparingly at an unprecedented time. Now is such an exceptional circumstance we'd all agree. The furloughing of basic OMB Director Salary helps but is not enough. There was a suggestion I saw that Dividend element of income could be possibly covered by Universal Credit. I personally am unsure of that as an option but it was suggested by an Associate trusted Chartered Accountant we know in our circle.