Last week the Chancellor announced his ‘Winter Economy Plan 2020’. All the important points are detailed below, but please note that not all of these will affect your business.
Job Support Scheme
A new job support scheme will start on 1st November for six months and will replace the current furlough scheme. The scheme is designed to contribute towards staff wages, for those who are working fewer than their normal hours. Here are the points to note –
- Employees must work at least 1/3rd of their usual hours.
- Employers will still be required to pay the wages for the hours employees do work.
- The government will pay up to 1/3rd of their usual wages (capped at £697.92 per month).
- Employers will need to pay for any remaining unworked hours, so employees are paid 2/3rd of their usual wages for hours unworked.
- Employers will be liable for all employer NI contributions and Pension contributions.
- To be eligible, employees must be registered on payroll on or before 23rd September.
Self Employed Grant Extension (SEISS)
There will be a 3rd and 4th grant for those who are still experiencing reduced demand over the winter months. The first grant will cover the 3 months from the start of November. More information will be released in due course for the 4th grant, which covers the 3 months from the start of February. HMRC will announce details on how to claim in due course. Here are the points to note –
- You must be actively trading.
- You must be adversely affected by COVID.
- The grant is not repayable, but will be subject to tax and national insurance.
- The grant will be taxable and will cover 20% of average trading profits, capped at £1875 in total.
Other important things to note –
- Self assessment taxpayers can now delay payments of tax due by 31st January. These can now be paid over the following 12 month period instead of in a lump sum.
- Those who deferred their VAT bills will be given the option to pay back over a 12 month period (interest free), rather than in a lump sum by the end of March next year.
- Bounce back loans , new and existing, will now be repayable over 10 years. Payment holidays and interest only repayment periods will also be available.
Further details can be found here –