The Chancellor unveiled the measures yesterday September 24th. The PM has also warned that the latest Covid-19 restrictions could last up to six months.
These are the key coronavirus announcements from the Chancellor’s Commons address:
- A new jobs support scheme – which will replace furlough – will see the government “directly support” the wages of people in “viable” jobs working at least a third of their normal hours.
- The government will top up a third of the worker’s salary that would have otherwise been lost as a result of working reduced hours – capped at £697.92 a month – which means a third will go unpaid.
- It will start in November and run for six months – with all small and medium-sized businesses eligible for the scheme.
- Larger firms will have to prove their profits have been affected by the COVID-19 pandemic in order to utilise it.
- Businesses will not be able to issue redundancy notices to employees while taking part in this scheme.
- The self-employed grant will be extended on similar terms as this new support scheme.
- A “pay as you grow” scheme to allow companies more time to repay bounce back loans over a period of up to 10 years rather than six.
- Those struggling to pay them back will now be able to choose to make interest-only repayments and “anyone in real trouble” can suspend repayments altogether for up to six months.
- VAT will remain at 5% for hospitality and tourism until 31 March 2021 – rather than reverting back to 20% in January.
- The deadline for taking out a coronavirus business interruption loan will be extended until 30 November, with the government guarantee on them extended for up to 10 years.
Comment from Institute of Fiscal Studies (IFS)
“The new job support scheme represents a significant new intervention from government to support jobs through the crisis. But it is significantly less generous than the furlough scheme it replaces. With employers now having to pay at least 55% of the normal wages of their employees it is clear that many jobs will be lost over the coming months.”
Contact for more information
Roger GUNNING FCMA CGMA
Gloucester Office
Tel: 01452 835724
Young people aged 16-24 who are on universal credit will be offered a six-month work placement with wages paid by the government. Young people taking part in the scheme will receive on-the-job training, skills development and mentoring. This will help them develop their skill base and start a future successful career. The scheme launch comes as companies like Tesco pledge to sign up. The scheme is part of the Plan for Jobs announced during Chancellor Rishi Sunak’s July Summer Economic Update and was launched on September 2nd this year
Chancellor Rishi Sunak said:
“This isn’t just about kick-starting our country’s economy – it is an opportunity to kick-start the careers of thousands of young people who could otherwise be left behind as a result of the pandemic. The scheme will open the door to a brighter future for a new generation and ensure the UK bounces back stronger as a country. The government will fully fund each “Kickstart” job – paying 100% of the age-relevant National Minimum Wage, National Insurance and pension contributions for 25 hours a week”.
Employers will be able to top up this wage, while the government will also pay employers £1500 to set up support and training for people on a Kickstart placement, as well as helping pay for uniforms and other set up costs. The scheme will give young people, the opportunity to build their skills in the workplace and to gain valuable experience. Businesses of all sizes looking to create quality jobs for young people can apply and there is no cap on the number of places.
The scheme, will be run by the Department for Work and Pensions and will be open until December 2021, with the option of being extended. The government is urging businesses to get involved in this innovative scheme and take advantage of the enormous pool of potential out there.
To help smaller businesses, employers offering fewer than 30 placements will be asked to make a bid through an intermediary, such as a Local Authority or Chamber of Commerce, who will then bid for 30 or more placements as a combined bid from several businesses. This will make the process easier and less labour intensive to apply for these smaller companies who only want to hire one or two Kick-starters.
Contact for more information
Roger GUNNING FCMA CGMA
Gloucester Office
Tel: 01452 835724
HMRC are inviting self-employed individuals or members of a partnership who have been adversely affected by the pandemic (Coronavirus-19) to claim a second grant referred to as the; self-employed income support grant. This support scheme does not apply to Company directors. This is a continuation of the first grant which closed in July 2020.
The second and final grant is worth 70% of an individual’s average monthly trading profits, paid out in a single instalment covering three months’ worth of profits. It is taxable and capped at £6,570.
Applications for the second and final grant are now open and applications must be submitted on or before October 19th this year. . The grant is available only to those self-employed individuals or members of partnerships that have been adversely affected by the virus on or after 14 July 2020.
HMRC will work out eligibility for the second grant in the same way as the first grant. You can make a claim for the second grant regardless of whether you made a claim for the first grant. HMRC have confirmed that the grant is payable even if you are continuing to work or starting a new trade.
Note
HMRC state that you must make the claim yourself. You cannot use an agent, accountant or advisor to claim on your behalf as this will trigger a fraud alert, which will delay your payment. You will have to prove to HMRC that your business has been adversely affected due to coronavirus.
What you will need
Self-Assessment Unique Taxpayer Reference (UTR)
National Insurance number
Government Gateway user ID and password
UK bank Account Details
HMRC relevant website
https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income-support-scheme
Contact for more information
Roger GUNNING FCMA CGMA
Gloucester Office
Tel: 01452 835724