COVID Support Update

After a backlash from the public that the proposed support for the coming months was too frugal, the Chancellor updated the future support schemes for businesses, employees and the self-employed.

Self-Employment Income Support Scheme Grant Extension

Two further grants covering the periods November 2020 to January 2021 and February 2020 to April 2021 were announced recently. The value of the first claim has increased from 20% to 40% of average monthly earnings for the first 3 months. In total, this first grant is now capped at £3,750 with the second grant yet to be decided.

Consistent to the previous SEISS grants, support receivable will likely be based on an average of previously filed tax returns and be eligible for an application mid-way through November, although the details are yet to be released. To be eligible for this your must have been eligible for the previous two grants, declare that you are continuing to trade and that you are being impacted negatively during this period due to COVID.

Job Support Scheme

The Job Support Scheme is taking over from the Furlough scheme as of the beginning of November for the following 6 months in the hopes to reduce the number of employees being let go in the coming months. For those businesses forced to close, the government will pay 2/3^rd’s of the employee’s wages up to a maximum of £2,083.33 per month.

For those staying open, but are still affected by restrictions, the gov.uk website states:

“The employee will need to work a minimum of 20% of their usual hours and the employer will continue to pay them as normal for the hours worked. Alongside this, the employee will receive 66.67% of their normal pay for the hours not worked – this will be made up of contributions from the employer and from the government. The employer will pay 5% of reference salary for the hours not worked, up to a maximum of £125 per month, with the discretion to pay more than this if they wish. The government will pay the remainder of 61.67%, of reference salary for the hours not worked, up to a maximum of £1,541.75 per month. This will ensure employees continue to receive at least 73% of their normal wages, where they earn £3,125 a month or less.”

Tier 2 and 3 Businesses Cash Grants

Tier three businesses will soon be able to obtain a grant for up to £3,000 whether they are open or shut.

Hospitality, accommodation and leisure businesses in tier two or three will be eligible for grants backdated to August for up to £2,100 per month for each month that the restrictions apply. This appears to be based on the rateable value of your business premises.

These are likely to be distributed by the Local Authorities, rather than making a direct application.

For more detail on the recent update:

https://www.gov.uk/government/news/plan-for-jobs-chancellor-increases-financial-support-for-businesses-and-workers

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