The Chancellor has been under pressure since his Winter Economy Plan announcement back in late September to go further in providing financial help for businesses. As a result of the ever changing Covid-19 situation, Rishi has proposed the following changes and additions to the support packages.
A revised Job Support Scheme (JSS)
The JSS comes into play from 1st November 2020 and will cover two scenarios.
- Scenario A. The UK government will top up wages for those employees working shorter hours than their ‘normal hours’ for businesses facing lower demand due to COVID-19.
- Scenario B. The UK Government will also provide financial support for those employees who cannot work as a result of their employer being forced to close under Covid-19 regulations. This will be through the employer’s PAYE Scheme
- Employees must work at least 20% of their usual hours.
- For every hour not worked the Government will cover 61.7%% of employee’s usual pay (capped at £1541.75 pm)
- For every hour not worked the employer must cover at least 5% of employee’s usual pay.
- Government will pay two thirds of each employee’s salary up to a monthly maximum of £2,100.
- No employer salary top up will be required.
- Business must be required legally to close as part of local or national restrictions and employees must be off work for a minimum of 7 consecutive days.
This includes businesses that are required to provide only delivery and collection services from their premises or food and drink outdoors from their premises.
For both Scenario A and B
- Employee must not be on a redundancy notice.
- Employer will be reimbursed in arrears.
- Employer must have a UK PAYE scheme and UK bank account.
- All small and medium enterprises will be eligible.
- The employee must have been on the employer RTI submission made to HMRC on or before 23rd September2020.
- Employers must agree the new scheme with staff in writing, including any changes to the employment contract. This agreement must be made available to HMRC on request.
- Larger businesses can claim if can demonstrate adversely affected by COVID-19. The government expects large employers not to make distributions while using the scheme.
- Employers can still claim the Job Retention Scheme bonus in 2021, even if claiming under the Job Support Scheme.
- The employer will be required to cover the cost of the employers NIC and pension contributions.
- The claims to be made in arrears through a HMRC Claims portal to be available from early December 2020.
The Job Retention Scheme (JRS) (as it affects Scotland)
- This comes to an end on 31st October 2020 for the whole of the UK.
- The Scottish Government has announced that there will be an additional grant of £1,650 to help those firms required to close, to help towards meeting the 20% employer’s costs under the JRS for October period.
- Further details will no doubt follow regarding this Scottish Government announcement.
The Self-Employed Income Support Scheme (SEISS)
SEISS has been extended for 6 months to April 2021. The grant is available to those self-employed:
- Already eligible under SEISS (even if they have not claimed in the past).
- Actively continuing to trade.
- Facing reduced demand due to COVID-19.
- There will be a grant covering the period from 1st November 2020 to 31st January 2021. There will be a further grant covering the period from 1st February 2021 to 30th April 2021.
- Each grant will cover 40% of average monthly trading profits, and capped at £3,750 in total.
English Business Grants
Two sets of grants are available:
Grant 1 – Aimed at businesses in the hospitality, accommodation and leisure sector which are not closed but are severely impacted by Covid-19 restrictions on socialising.
Grant 2 – Aimed at businesses who have been forced to close due to the Covid-19 restrictions being imposed upon them.
- Aimed at the hospitality, accommodation and leisure sector.
- Funded through Local authorities (LA).
- To support businesses in high alert areas which are not closed but are severely impacted by the Covid-19 restrictions on socialising.
- The grants will be available retrospectively for those areas who have already been subject to Covid-19 restrictions.
- Properties with a rateable value of £15,000 or under – grant of £934 per month.
- Properties with a rateable value of between £15,000 and £51,000 – grant of £1,400 per month.
- Properties with a rateable value of £51,000 or more – grant of £2,100 per month.
- The LA will receive a further 5% top up to cover grants for those businesses who might not fit neatly into the hospitality, accommodation and leisure sector bracket. It will be at the LA discretion.
- Aimed at businesses forced to close due to covid-19 regulations being imposed upon by them.
- Affected small businesses with a rateable value of £15,000 or below can now claim a grant of £1,300 per month.
- Affected medium sized businesses with a rateable value between £15,000 and £51,000 can claim a grant of £2,000 per month.
- Affected larger businesses can claim a grant of £3,000 per month.
- The grant will be payable every 2 weeks and paid in arrears.
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If you would like to know more about the recent changes and how these new measure can be implemented, please contact us today. Our business growth experts are here to help you guide through these challenging times.