The COVID-19 crisis has deeply impacted creative industry cashflow and many of our clients have shared heartfelt concerns that the sector is teetering on the edge of a catastrophe, with jobs on the line and creative organisations struggling to see their way to stability, let alone growth.
That’s why we welcomed the Government’s £1.57bn support package with open arms. But, what does the support package include? And, will it be distributed fairly?
What do we know?
- The support package is ‘new money’ for the UK’s creative sector.
- Made up of £880m in grants and a further £270m in repayable loans, both of which will be available to apply for through industry bodies.
- It also includes £100million for national cultural institutions in England and the English Heritage Trust and £120million of capital investment to restart construction on cultural infrastructure and heritage construction projects in England that were put on hold due to the pandemic.
- The package will help creative industry businesses including independent cinemas, theatres and galleries – all badly hit and reporting that they’re on the brink of collapse.
Kim Redwood-Lee, MD Oscar Fairchild said: “It’s not yet clear how much the funding will support the freelance creative community – many of whom have seen their income wiped out, can’t be furloughed, and likely don’t qualify for SSEIS (the self-employed income support scheme)”.
This is a view echoed by Philippa Childs, head of the Bectu union. In a recent BBC news article, she said the support package was overdue. Adding that the industry would now be scrutinising the details of this package to make sure it lives up to the real needs of our sector.
What can we expect going forward?
There is no doubt that, even with the support package, creative businesses across the country still face immense challenges ahead.
The support package alone won’t be able to save every organisation and institution. Directors will have to make difficult decisions and look for more ways to ease cashflow.
At Oscar Fairchild we’re exploring other options with clients and considering all routes available.
Creative Industries Tax Relief – not a loan, does not have to be paid back
This is an incentive-built relief, across 8 different sub-sectors. It can significantly lower your company’s Corporation Tax liability and may be the saving grace your organisation needs to navigate through these uncertain times.
As the Creative Industries Tax Relief is considered a form of state aid you won’t be able to apply if you’ve already utilised governmental support measures such as the furlough scheme (Coronavirus Job Retention Scheme).
The process of claiming for tax relief, along with state aid, can become complex. We’d always recommend that you speak to a professional advisor who is best placed to help you.
If your business as been impacted by the Coronavirus (COVID-19) outbreak and you are now struggling financially and operationally to deal with the increasing pressure of debtor, supplier and cash flow management, then we are here to help.
About Oscar Fairchild:
Oscar Fairchild (incorporating Redwood Clarke since 01.09.18) is an ACCA chartered and certified and AAT qualified accountancy, financial consultancy & bookkeeping practice with offices in The City of London, and Billericay, Essex. Offering a wide range of services including Self-Assessment Services, Annual Returns, VAT Returns, Credit Control, Payroll, Auto Enrolment Pension and Management Account services to high growth businesses and licensed London taxi drivers across London, Essex and Hertfordshire.