From mortgage holidays to help with paying off your credit card, self-assessment tax relief to halting your TV subscription, here's what you need to know about navigating these uncertain times
The COVID-19 outbreak has created a huge amount of uncertainty in terms of job security and personal finance. To help you get your head round it all, we've compiled all the important information into one handy factsheet.
I've been told that I'm being furloughed from my job. What does that mean?
The coronavirus outbreak has left thousands of businesses struggling to stay afloat. To avoid them having to lose their workforce, chancellor Rishi Sunak has introduced the Coronavirus Job Retention Scheme, whereby employees are effectively granted a temporary gardening leave while the government pays 80% of their wages, up to a maximum of £2,500 per month.
What financial help can I get if I'm self-employed?
Rishi Sunak has announced a £3billion-a-month support package for self-employed people in the UK. Under the scheme, those eligible will receive a cash grant worth 80% of their average monthly trading profits over the past three years, up to a maximum of £2,500 a month. The grant will cover the three months to May, with a single lump sum being paid into their bank or building society account in June.
The grant is not available to newly self-employed people or those whose trading profits exceeded £50,000 a year between 2016-2019. Nothing needs to be done at this point – HMRC will identify eligible people and invite them to apply in due course.
Can I claim benefits during the coronavirus crisis?
If you have lost your job or are still working but struggling to make ends meet, you may well be eligible for a range of benefits, including Universal Credit. To find out more, visit the dedicated benefits page on the government's website.
What should I do if I can't afford to pay my mortgage?
Following talks with the government, mortgage lenders have agreed in principle to offer customers experiencing financial difficulties a three-month 'mortgage holiday', whereby monthly payments are suspended. Please note that interest will still be added to your overall balance during this time, and future monthly payments will increase as a consequence. To apply for a mortgage holiday, you will need to speak directly to your lender.
I can't afford to pay my utility bills. Will I have my services cut off?
All of the utility companies serving the UK have agreed to offer solutions to customers struggling financially during the coronavirus crisis, from pausing accounts to removing late payment charges. Disconnections due to missed payments on credit meters have also been suspended. Contact your utility company to see what they can do for you.
I have a self-assessment tax bill due in July. Will I be given help to pay it?
Yes, the government has stated that anyone owing money on their self-assessment account in July can defer payment until 31 January 2021 without having to apply or notify HMRC. Obviously, if you can afford to make at least part of the payment, you should, as it'll prevent you being hit with an unmanageable debt come January.
I can't keep up my credit card and loan repayments – what's the answer?
Britain's financial regulator is proposing that credit card, store card and loan repayments be frozen temporarily to provide relief to people struggling financially during the coronavirus outbreak. Again, if you can afford to continue making payments, it's advised that you do – especially as the proposal states that “a reasonable rate of interest” may still be charged during the suspension period.
As for overdrafts, it has been proposed that banks offer their customers an interest-free arrangement on overdrafts up to £500.
A decision on both of these proposals is expected to be made on 9 April.
The MOT on my car is due to expire but my local garage is closed. What should I do?
The government has said that if your car, van or motorcycle's MOT is due to expire on or after 30 March, it will automatically be extended by six months. Your insurance will still be valid and the police will be notified that your vehicle is road-legal. Please ensure that your car is safe to drive, and continue to tax it as normal. If your MOT ran out before 30 March, there are a different set of guidelines.
Do I still have to pay for my TV sports packages while there's no sport on?
No. With the football, tennis, F1 and other major sporting events having been postponed for the foreseeable future, it doesn't make sense to continue stumping up for your monthly package. Sky Sports is giving customers the option to pause their subscription until normal service is resumed, while BT Sport is offering two months' credit, which can either be donated to NHS Charities Together or taken off your bill.
My child was getting free meals while schools were open. Is it possible to still get these now that they're home-schooling?
Yes, if your child is eligible for free lunches, government guidance states that these should still be provided by the school in question. How this works logistically will be down to the school itself, but may include home delivery or the allocation of supermarket vouchers. Parents or guardians should contact the school directly.
How can I save money generally during the coronavirus lockdown?
Obviously, you'll save money you would normally spend going to the cinema, the pub, etc. But there are other ways that you can pinch the pennies.
Consider whether you really need to buy all that food you've been filling your trolley with at the supermarket. It's understandable that you'd want to buy lots of goodies to cheer yourself up during a lockdown period. But the cost can quickly add up, and it could soon start to notice on your waistline, too. What's more, if you're buying loads of stuff with a 'best before' date, chances are some of it will end up going in the bin.
Next up, streamline those unnecessary online outgoings. “One wet weekend, print out your bank and credit card statements for the last year,” says financial expert and BBC Money Box presenter Paul Lewis. “Highlight any unknown monthly or annual payments, and check them. That annual payment for Wrench Times, which you never read? Bin it. And then the free trial offers that you never cancelled.
“Stop these 'continuous payment authorities' by telling your bank or credit card provider 'stop it', which it must do at once. Then, if you want, tell the firm as well.”