The Council for Licensed Conveyancers (CLC) is to give the firms it regulates the option of deferring the regulatory fees they pay to help them cope with the coronavirus crisis.
The CLC said it believes that businesses that were sound before the coronavirus restrictions came into force should emerge from this period in good shape and able to support the national recovery effort. However the short-term economic effects of Covid-19 are likely to be particularly difficult for the conveyancing sector.
As a result, the CLC Council has determined to support the practices it regulates by giving them the option to defer payment of their Practice Fee and Compensation Fund contributions for April, May and June. Most CLC practices pay by monthly direct debit and the scheme is open to those practices.
Firms deferring their payments in this way will be given the option to repay the deferred fees over either four or 12 months, starting in July 2020.
The CLC is now writing to practices with details of how to apply. Firms will need to provide financial information supporting their application and details of actions they have taken and will be taking to support their practice.
However, the CLC points out that practices must continue paying their professional indemnity insurance premiums as the policy is triggered at the point a claim is made, rather than when the alleged negligent act was done.
The CLC has been surveying regulated firms weekly to see in detail the impact of the pandemic on them and their clients. With the home-moving market all but at a standstill, specialist conveyancing firms have told the CLC that while new instructions have all but stopped, remortgage work, will-writing and probate continue.
Many practices are now using the Coronavirus Job Retention Scheme to furlough staff, deferring VAT and income tax payments, and applying to the Coronavirus Business Interruption Loan Scheme. Some firms will close temporarily with the permission of the CLC and having taken steps to protect their clients and their employees.
CLC chief executive Sheila Kumar said: “These are difficult times for everyone and the property market, and hence conveyancing practices and their clients have been struck very hard by the restrictions in place to control the pandemic.
“While this crisis will pass, it is right that we act swiftly to support the firms we regulate. We want to ensure they can continue to operate and provide essential services to their clients in an appropriately regulated environment.
“Feedback from our regulated community indicates that deferring payment of regulatory fees will be of great help to them. Should the challenges for the sector continue past June, we will look at what further steps we can take to support CLC-regulated firms.”