The Bounce Back Loan scheme intends to help small and medium-sized businesses borrow between £2,000 and £50,000 from lenders to support them during the crisis.
The government will guarantee 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. Loan terms will be up to 6 years and no repayments will be due in the first 12 months. The scheme will be delivered through a network of accredited lenders who will work with the government to agree a low rate of interest for the remaining period of the loan.
Who is eligible for the scheme?
You can apply for a loan if your business:
- Is based in the UK
- Has been negatively affected by coronavirus
- Businesses that were undertakings in difficulty on 31 December 2019 can apply.
- You can’t apply if you are already claiming under the Coronavirus Business Interruption Loan Scheme – but if your loan was less than £50,000, you can transfer the loan to the Bounce Back Loan Scheme.
When will it become available?
The scheme was launched on 4th May 2020.
As this is a company loan to support businesses during the COVID-19 crisis, any funds taken from your company for personal use derived from the loan cash injection will still comprise dividends and attract personal tax liabilities accordingly.