Here’s what the Winter Economy Plan means for you and your business
Rishi Sunak has just announced his plan to support the economy as an upsurge of Coronavirus cases indicate a second wave. Our latest blog details everything we know about updates to the Job Support Scheme, Self Employed Income Support Scheme, Government Loan Schemes and Tax payments.
Rishi Sunak has just announced his plan to support the economy as an upsurge of Coronavirus cases indicate a second wave. The email below details everything we know about:
The new Job Support Scheme which will replace the Job Retention Scheme after it ends on 31st October
Extension of the Self Employed Income Support Scheme
Deadline extensions and changes to the
Coronavirus Business Interruption Loan Scheme
Bounce Back Loan Scheme
Coronavirus Large Business Interruption Loan Scheme
VAT and Self-assessment payment support
CORONAVIRUS JOB SUPPORT SCHEME In order to keep as many people in employment as possible, the Chancellor has announced a new scheme available to businesses across the UK (even if they have not previously used the furlough scheme) from 1st November 2020. Below is an overview:
Businesses that are facing lower demand over the winter months due to coronavirus will be able to apply to protect viable jobs.
The government will contribute towards the wages of employees who are working fewer than normal hours due to decreased demand.
The scheme will run for 6 months to keep employees 'attached to the workforce'.
Employers will continue to pay the wages of staff for the hours they work.
For the hours not worked, the government and the employer will each pay one third of their equivalent salary.
To support only viable jobs, employees must be working at least 33% of their usual hours.
The level of grant will be calculated based on the employee’s usual salary, capped at £697.92 per month.
Even if you will be claiming from the Job Support Scheme, you will still be able to claim your £1,000 per employee Job Retention Scheme Bonus for previously furloughed workers should they be retained in employment until at least 31st January 2021.
SUPPORT FROM LWA FOR OUR PAYROLL SERVICES CLIENTS We have been able to support our Payroll Services clients throughout the pandemic by calculating and managing their Job Retention Scheme furlough grant claims from HMRC.
If you are currently one of our Payroll Services clients and think you might need to claim from the Job Support Scheme, please contact our team on 0161 905 1801 as we will be able to continue assisting you if needed.
UPDATE ON SELF-EMPLOYED INCOME SUPPORT SCHEME (SEISS)
If you are self-employed and eligible to claim from the SEISS, Rishi Sunak has today announced he will be extending the scheme.
An initial taxable grant will be provided to those who are currently eligible for SEISS and are continuing to actively trade but face reduced demand due to coronavirus.
The initial lump sum will cover three months’ worth of profits for the period from 1st November 2020 to the 31st January 2021. This is worth 20% of average monthly profits, up to a total of £1,875.
An additional second grant, which may be adjusted to respond to changing circumstances, will be available for self-employed individuals to cover the period from 1st February to 30th April 2021.
As previously with SEISS, LWA or any agent unfortunately won't be able to make the claim on your behalf in accordance with the Government guidelines.
GOVERNMENT LOAN SCHEMES
As part of today's announcement, changes have been confirmed that will allow more businesses to apply for one of the three government loan schemes, as well as allowing more flexibility for repayments:
If you have previously taken out a Bounce Back Loan, you will be eligible for the new Pay as You Grow flexible repayment system by extending the length of the loan from six years to ten. Interest-only and payment holidays will also be available to businesses for periods of up to six months.
Coronavirus Business Interruption Loan Scheme (CBILS) lenders will be given the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan. The deadline to apply for CBILS and for the Coronavirus Large Business Interruption Loan Scheme has also now been extended to 30th November 2020.
TAX CUTS AND DEFERRED TAX PAYMENTS
Options to delay VAT and Self-assessment tax payments have also been announced:
The government has confirmed it will extend the temporary 15% VAT cut for the tourism and hospitality sectors to the end of March next year.
Business who deferred their VAT bills will be given more breathing space through the New Payment Scheme, which gives them the option to make 11 smaller interest-free payments during the 2021-22 financial year rather than paying the full lump sum by 31st March 2021.
A separate additional 12-month extension from HMRC has been applied on the “Time to Pay” self-service facility for self-assessment tax payments, meaning payments deferred from July 2020, and those due in January 2021, will now not need to be paid until January 2022.
WE'RE STILL HERE TO HELP We will continue to keep you updated on any additional government guidance and notes issued that we are made aware of. If you have any specific concerns, please feel free to contact a member of our team on 0161 905 1801 in Manchester, or 01925 830 830 in Warrington.
In the meantime, for all of LWA's previous updates on the Coronavirus Job Retention Scheme, please visit the dedicated Coronavirus Guidance section on our website.