Hundreds of thousands of directors of limited companies who pay themselves through dividends are likely to be left without any government support during the coronavirus crisis, it has emerged.
Blick Rothenberg, an accountancy firm, estimates that one in 10 small business directors pay themselves only once a year through their own limited companies to minimise accounting fees. However, those who file their company tax returns at the end of the tax year, which closed on April 5, are likely to miss out on the government’s furlough scheme on a technicality because it only recognises employees who registered before March 19.
The owners of limited companies who do qualify for support are already facing a significant hit in the amount they can claim because the government recognises only salary and not dividend payments — which make up most of their income — as being eligible for support.
Rick Stein was roundly condemned when he shut up shop and stopped paying his staff at the start of lockdown, claiming his restaurant empire was on the brink.
Now Stein and his ex-wife Jill have drawn up plans to close several of his 14 restaurants, including two at the heart of his Cornish operation.
The multi-millionaire chef’s managing director Ian Fitzgerald told his 600 staff: ‘It remains a challenging time for everyone as we come to terms with the implications and repercussions of the coronavirus crisis. Sadly, with less customers expected in the future, it is likely that we will need to employ fewer people.
‘Ongoing discussions with the bank and our landlords have not yielded sufficient progress and therefore we are having to sadly look at the viability of a small number of operational sites which includes consulting with Porthleven, Falmouth and Marlborough.’
A little-known Russian media executive with close commercial ties to the state has bought leading business newspaper Vedomosti, reports Max Seddon of the Financial Times.
Seddon reports, “Staff at Vedomosti say the eleventh-hour appearance of Ivan Eremin to rescue the sale is unlikely to ease their stand-off with the paper’s new acting editor, whom they claim banned writing on topics that the Kremlin considers taboo.
“The clash over Vedomosti, according to its reporters, shows the Kremlin wants to increase its control over what little remains of the nominally independent media. In recent years, several other outlets have been sold to Kremlin-friendly owners and have installed pliant editors, prompting staff to quit en masse.
“A consortium led by publisher Demyan Kudryavtsev took over Vedomosti — co-founded and formerly co-owned by the FT and the Wall Street Journal — in 2015 after Russia limited foreign ownership of media to 20 per cent.”