COVID-19 Update – 6th May 2020
Today we share our 22nd Scottish Dental Sector Covid-19 update with you.
Yesterday’s news conference brought the good news that confirmed we have now passed the peak of infection rate in the country. Whilst still extremely tragic for all involved, the daily death rate also reached the lowest point yesterday since the end of March. This seems to provide hope for the country that we may return to some form of normality in the not too distant future and we all look forward to the Prime Minister releasing his action plan on the phased return next Sunday. What ‘return to work’ looks like to the Scottish Dental Profession at this point though is still unclear. We would very much like to see some form of announcement of a ‘Plan A’ for Scottish Dental professionals to allow some practical and financial preparation. Let us hope that this emerges soon.
Conversely however, it seems clear from today’s announcement by the First Minister that the risk of overwhelming NHS capacity through relaxing measures too swiftly is present. If we are to interpret this in a wider sense it seems likely that lock down is with us for some time yet.
FUNDING UPDATE
BUSINESS SUPPORT GRANT PHASES 1 & 2
We continue to hear mixed reports on the receipt on this valuable grant support. I have previously covered in my digests that Edinburgh City Council were struggling with their workload and a number of practices were unsure of the progress state of their application. I am happy to confirm now that many of these practices have managed to release same day payment from the Council this week after they emailed the Chief Executive of the Council directly. It appears that the Chief Executive was keen to support and has provided a rapid feedback when pushed. This has seen these £10,000 support grants being released. Anyone in this council area who is still awaiting their support would be advised to contact the Chief Executive on the following email address: to ask for his prompt assistance. Anyone in Glasgow City Council should also consider contacting their Chief Executive on the same basis.
The ‘postcode lottery’ of the eligibility for those above £18,000 rateable value continues, and we are aware of inconsistent decisions across various regions and bizarrely within the same council. We are seeing identical applications being approved and rejected with no clear guidance provided. We have recommended to those who have not received the support in this banding to appeal the decision directly and at the same time to contact their members of Parliament/Scottish Parliament for their support. We are aware that a collective political will exists to remedy the situation. Whether this brings any tangible benefit in due course or not remains to be seen. I am able to share a letter from the CDO’s office today below in response to the questions raised.
While there is very little of new information in this reply it does provide a small glimmer of hope in that the matter has been passed to the Cabinet Secretary for Communities and Local Government for further review.
For those practices who have been fortunate enough to receive the £25,000 grant, it may be prudent to set aside if possible in case this later emerges as an error and an attempt to claw back is made.
I would highlight that the second phase of this support grant goes live today. It is now available for applications. You will recall that this entitles you to receive 75% of the £10,000 grant on any and all additional properties that you own as part of your practice. We are aware that in some instances you may have store rooms, outhouses, additional vacant properties, etc. attached to the practice. Where these properties are held as a separate listing on the non-domestic ratepayer register we are informed that you are likely to be entitled to make a second claim and we would encourage you to do so at this stage. The updated online application/forms are now available online at the same links I shared in my earlier updates. I’m happy to help if you find difficulty in locating the application forms.
JOB RETENTION SCHEME (FURLOUGH)
We are very pleased to see the continuing receipt of the furlough grant for a number of our practices arriving in time for support of salary payments. With the scheme now extended until the end of June and still open to further review this continues to provide a lifeline for practices at this time. The Chancellor was quoted today as saying this scheme is very expensive to the nation and unlikely to continue much longer than in place at this point. The danger inherent therefore in this support scheme is the period of return to work. If this support is no longer available at that time alongside the potential requirement to space appointments with additional resources cost e.g. labour, power and PPE it seems likely that the return to work phase could be very cash intensive. It makes a great deal of sense to plan for that period once we have a better idea of clinical guidance. In the meantime, we suggest that now would be a good time to consider your normal performance management of the practice and seek out potential improvements and cash savings to achieve best results.
Please be aware if you have been attempting to contact our Payroll Team, that the intensive and complex workload involved with the provision of these free of charge applications we have submitted is unprecedented. The team have been working round the clock in an effort to access these important funds on behalf of our clients. As a result, the response times for general email correspondence has slipped a little but it is hoped that they will return to normality once caught up. Thank you for your patience at this time.
NEWLY SELF EMPLOYED HARDSHIP FUND
This fund opened late last week and is likely to be helpful to anyone returning to the profession after a career break or those completing VT contracts in August 2019 and ineligible for other support.
Full details and how to apply can be found at this link – Newly Self Employed Hardship Fund
If successful in your application a one off payment of £2,000 will be made via the local councils involved. Broadly speaking if it can be demonstrated that you are bona fide self employed and have been impacted by Covid-19 (and trading profits below £50k on 2019-20) you should be eligible.
BOUNCE BACK LOANS FOR SMALL BUSINESS
The Bounce Back Loans were launched yesterday (4th of May at 7 AM.) As you are aware from my previous updates, these loans are capped at £50,000 or 25% of your annual turnover in 2019. They are available to anyone with a business bank account who has been impacted by Covid-19. To access these loans, you are required to contact your own business bank and undertake their online application process.
The mainstream banks released their applications yesterday, but we are aware that a number of others are to follow and are hoped to launch within the next 24 hours. We are already aware that some applications submitted yesterday received their loan finance on the same day and the process from start to finish for the application takes less than 10 minutes (record so far is 2!)
This is clearly not grant funding and it should be borne in mind that it will be repayable within 6 years. It is however likely to provide some very useful low-cost finance for practices and dental professionals who require additional finance to trade through this time.
The funding is interest and repayment free for the first year with a low rate of interest of 2.5% applied thereafter in years 2-6. The government will pay the interest in year one and provide a guarantee to the banks against any default. You are liable in the first instance for the loan, but no personal guarantees are sought in the process. Bear in mind however that unless you trade via a limited company your personal assets are always at risk.
Given there are no major restrictions on how the finance is used and it can be repaid at any point without penalty as long as 10 days’ notice is given, it would seem prudent if there is a potential need for cash to make an application at this time. The only restrictions are that the funds are not for personal spend and not to be used for the purchase of fixed assets unless a replacement for an existing asset. Even if the funds are not utilised, they could be repaid in 12 months time at no cost and you will have a potential contingency safety net during that period to help you to survive this crisis time.
This loan is available to self employed associates and therapists as well as practices. However most of the banks require a business bank account to be in place for the application so any sole trade operating via a personal account may encounter some issues with the process.
Please do let us know if you need assistance with an application.
There is a very useful frequently asked questions for small business on their British business bank website at the following link: Bounceback FAQ’s
Although I don’t suggest this flippantly, this is one of the easiest accessed funds at a very low cost that I have ever seen. With the flexibility of being able to repay at the end of year one it would seem foolhardy not to consider the loan scheme as a sensible contingency fund option for most practices at this time.
PIVOTAL ENTERPRISE RESILIENCE FUND
This fund was released late last week but has now paused for live applications to allow assessment of the applications received to date. It is hoped that the fund will reopen next week and next steps will be released. The guidance on this scheme is very general and given that it is administered via Scottish Enterprise we are reading that this fund is targeted at the medium size, high growth sectors which they are normally responsible for. The fund rules which are published, indicate that in overview Scottish Dental Practices are potentially eligible however there are number of caveats – inclusive of the fact that in the major city conurbations businesses employing less than ten people are unlikely to be approved. The application process allows grant funding between £2,000 and £100,000 to be accessed and is geared towards businesses which are deemed to be critical for either recovery or public services. In our opinion there is clear linkage between the dental sector and vital community services. We have assisted a small number of practices to apply this week but with no feedback on the responses. We are of the opinion at this stage that the likelihood of success is low, but if success is to follow we will report and signpost towards the fund. If interested in reading more you can find more guideline on the following link: Pivotal Resilience Fund.
SELF-EMPLOYED INCOME SUPPORT SCHEME
The self-employed income support scheme which is due to pay grant funding of up to £7,500 in June continues to progress and was enacted in law on Friday. The document which enacts this as law is shared below.
HMRC yesterday launched the online checker to assess whether you’re eligible for the relief and this can be accessed at the following link: check your status for eligibility
We are aware that the system is providing some spurious results and there is a review/appeal process available which you can access via HMRC. We would advise anyone who feels that they are eligible to run through the checker to ask for an appeal if necessary. They should also consider whether they have a personal tax online account in case this is utilized for the application. HMRC have written to us to confirm that accountants and agents will not be able to make applications on behalf of self-employed individuals and this will be a personal application process. However we will of course be happy to advise in any way we can with applications. If this fund is likely to be vital to your personal cashflow you would be prudent to ensure you can access your personal tax account or set one up now at this link – setup a personal tax account
HMRC are intending to accelerate the contact to those they feel eligible and it is proposed that they will be in touch directly this week via a combination of texts, letters and emails. NB – This is prime territory for the unscrupulous scammers of the world so please take caution in replying to any contact. The applications (online – potentially via your personal tax account) will open from 13th May and funds will be received after 6 working days of application from the 25th May onwards.
RETURN TO PRACTICE
I would suggest it is more important than ever to ensure that your practices are run efficiently going forward. I have been in discussions with Software of Excellence and their team on behalf of our clients this past week. We have discussed how we can work together for mutual client benefit in this period and have agreed a program of support available to you free of charge.
Software of Excellence are happy to make available a number of features/modules within their software free of charge up until September. It is suggested you utilize this for analysis, planning, marketing and ‘contactless’ return to practice. Clearly the hope from SOE’s perspective is that they can support everybody through this period. They hope you can see the value in the extra options too and may continue to subscribe beyond September, but you are in no way obliged to do so. Regardless of your long term plans with the modules this is a great opportunity for you to get ‘hands on’ and really undertake a deep dive analysis of your practice information at this point. We have offered our support to help SOE to analyze the practice performance using the ‘My Practice Cloud’ module for online analysis. We suggest that if you are a SOE user that you contact us and we will organise to have this installed by SOE free of charge and help to analyze your data. Once established we can set up a free zoom consultation with their consultant to walk through the numbers together. Our offer is to attend this meeting with you and to help you interpret the numbers independently and to overlay this to your own ‘return to’ business plans. All of our input would be free of charge and we invite you to contact us if this is something that you would like to take advantage of.
We continue to see the best and worst in people existing at this time. We are aware that many PPE and air filtration providers are attempting to profiteer from the anxieties by overpricing their products. Please take care when accessing these products that you are not being misled. We are also disappointed to hear that our colleagues in the accountancy sector continue to seek inflated fees from distressed practices. In particular I was really disappointed to hear that some firms have chosen to take an ‘ambulance chasing approach’ to pricing at this time and in some instances charging up to 10% of the Furlough grant receipts or £1,200 + VAT for single claims. These funds are precious to practices at this point and might be the difference between survival and failure. If you hear of anyone who needs support and a more humanity focussed approach please feel free to signpost them to our offer of free help and advice support service. A time for all to help in my opinion.
We continue to enjoy seeing our clients, our teams, their children and their pets and anyone else in isolation via zoom meetings that we have been holding. You may at this point be seeking new ideas on how to keep your team happy and motivated and I would direct you to this website – Virtual Team Building Games– which gives you some virtual team ideas to enjoy with each other. Have fun!
Once again love and best wishes to you at this time from myself and the full Dental Accountants Scotland team. I hope you manage to stay safe and well.
As a recurring reminder – our full team are now working remotely but ready and willing to continue to do all we can to support you in any way possible. Please accept my ongoing apology for any delayed reply to your emails while we work harder than ever to support you during this crisis. The level of correspondence required has severely tested my words per minute typing skills! For any urgent queries you may have please continue to call my mobile 07375 700468 (day or night) or book a zoom online consultation here and I will be glad to support you in anyway. Our no fee advice is available to you at this time and we will do all we can as part of your team.
I invite you to keep up to date with information our blog and to like our Facebook page to stay in touch.
Stay safe and look after yourself and all around you at this difficult time.
