Business Support

Latest Changes to Government Support – March 2021


As you will be aware, the various loan schemes introduced last year (CBILS, BBLS, etc) are closing on 31 March 2021, to be replaced by the Recovery Loan Scheme. However, there are also some further changes of which you should be aware, in particular in relation to directors’ duties and creditor enforcement.

Creditors remain unable to issue statutory demands

The suspension of a creditor’s ability to issue a statutory demand and winding up petitions has been extended from 31 March 2021 to 30 June 2021. Creditors are still able to issue proceedings for a judgment, however, and failure to adhere to the judgment may result in that judgment being enforced in due course.

Landlords are still unable to enforce their rights under leases

Commercial tenants will no doubt be pleased to hear that the moratorium on landlords taking enforcement action has also been extended until 30 June 2021.

Moratorium rules continue to be relaxed

Companies can now enter into a moratorium until 30 September 2021, even if they have been subject to an insolvency procedure in the preceding 12 months.

Termination clauses continue to be prohibited

Although small suppliers are now exempt until 30 June 2021, rather than 31 March 2021, which was the previous end date.

Suspension of wrongful trading provisions

These provisions have been extended from 30 April 2021 to 30 June 2021. This means that a director or shadow director cannot be held personally liable for financial losses arising from continuing to trade the business during this period. Ordinarily, wrongful trading occurs when the financial position of a company is worsened because the directors did not take action as soon as they became aware that the company would need to enter an Administration or Liquidation.

But beware…

However, directors’ fiduciary duties still apply, as do the provisions for any breach of fiduciary duty (known as misfeasance) so if a company is struggling to manage its cashflow and is unable to pay its liabilities as and when they fall due, directors will still be expected to treat all stakeholders (including creditors) equally.

Utilise the breathing space

With the vaccination programme in full flow and restrictions being scheduled to be lifted on 21 June 2021 per the Government’s current roadmap (note that this may be subject to change), it now seems like the Government’s support of businesses during the pandemic is nearing its conclusion. We would encourage any business owners who have outstanding liabilities and are looking at a cash shortfall in the next few months to review their cashflow forecasts and to seek advice if they have any concerns about returning to profitability. There are many options to help businesses get back on their feet, so please feel free to get in touch with our team if this resonates with you.

For more information on available loan schemes or cashflow advice, please get in touch with Heather Bamforth on 0808 144 5575 or email

Contact Heather

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