As a second national lockdown has now been announced, bringing with it shifts and changes in the various financial support packages available, we thought it may be helpful to round up the key points of each available scheme in one place.
In this very stressful time, we hope it cuts through the noise and clarifies some key points for you.
Furlough Scheme Extension
The Coronavirus Job Retention Scheme (Furlough) has been extended to March 2021 (with a review planned for January 2021), with employees still receiving 80% of their current salary for hours not worked up to a maximum of £2,500.
However, under the extended scheme, the cost for employers will be reduced compared to the current scheme, which ended on the 31st October 2020, as they will only be asked to cover National Insurance and employer pension contributions with the government paying the full 80% of wages.
Businesses will continue to have the flexibility to bring furloughed employees back to work on a part time basis or furlough them full-time. Furloughed employees must have been on the payroll since 30th October 2020 to qualify.
While the government updates the system to accommodate the extension, employers will submit their wage claim to the government and be refunded afterwards. After that, they will be paid upfront to cover the cost.
Business Support Grants
Business premises forced to close in England are to receive grants worth up to £3,000 per month:
For properties with a rateable value of £15k or under, grants will be £1,334 per month, or £667 per two weeks
For properties with a rateable value of between £15k-£51k, grants will be £2,000 per month, or £1,000 per two weeks
For properties with a rateable value of £51k or over, grants will be £3,000 per month, or £1,500 per two weeks
These were due to be ended at the end of October but the closing date has now been extended.
Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday.
Those that have already started a mortgage payment holiday will be able to top up to six months.
Self-Employment Income Support Scheme Grant Extension
Chancellor Rishi Sunak has announced that from the 1st November 20, the self-employed will be able to claim state aid of up to 80% of profits (up from 40%). The scheme will run until April 2021.
This scheme comes in the form of two grants; each available for three month periods covering November 2020 – January 2021 and February 2021 – April 2021.
As with previous grants, these are counted as taxable income and are also subject to National Insurance contributions.
Eligibility for claiming is detailed as:
– have been previously eligible for the Self-Employment Income Support Scheme first and second grant (whether they claimed the previous grants or not)
– declare that they intend to continue to trade and either: are currently actively trading but are impacted by reduced demand due to coronavirus OR were previously trading but are temporarily unable to do so due to coronavirus
Job Retention Bonus
The rules for this remain unchanged since our blog, written in September, but the dates from which you can claim have shifted due to the November lockdown period.
You now cannot claim the Job Retention Bonus until 15 February 2021.