National Lockdown Financial Support updated 5 November 2020
Following the announcement last weekend of a national lockdown in England until 2 December the Chancellor has now revised the support for business.
Support for Employers
The Job Support Scheme has been scrapped, at least for now, and the Furlough Scheme has been brought back across the UK until the end of March with a review in January. Employees will receive 80% of salary which may be subject to reduction in the New Year review. Employers will be liable for minimum pension contributions and employer NI contributions. The support is capped at £2,500 per month.
Staff may be furloughed for any flexible period including full time. Only staff who are still employed at 30 October and who were on an RTI submission of earnings between March and October 2020 are eligible. There is no requirement that staff should have been furloughed under the previous arrangements.
The portal for making advance funding claims will open on 11 November 2020 and the November claims must be submitted by 14 December. With the 14th of each month being the monthly cut-off date.
The Jobs Retention Bonus has also been scrapped, and the Government will look at an incentive to retain staff at a more appropriate time.
Self Employed Support Scheme
Today’s announcement also further extends the Self-employed Grant.
The grant to cover November – January will now be paid at 80% of average profits for the 3-month period and is capped at £7,500. The portal to make your claim will open on 30 November and payments will be made before Christmas.
Details of the fourth grant to be made in the Spring will be announced later.
Additional support will be made to hospitality, leisure and accommodation businesses who were in Tiers 2 & 3 in England. This will be backdated to 1 August up to a maximum of £2,100 per month, 70% of the grant available to closed businesses. This will be paid at the discretion of the local authority.
The VAT deferral period is extended beyond March allowing businesses to pay their VAT interest free over 11 instalments during 2021-22. We await further guidance as to how businesses can access this New Payment Scheme
The 15% temporary reduction in the VAT rate for the hospitality sector is extended through to March 2021.
Government Backed Loans
Bounce Back loans will now benefit from an extension to the repayment period from six years to 10. Payment holidays and interest only periods will also be made available.
Lenders under the Coronavirus Business Interruption Scheme will be given the ability to extend loans for up to ten years to help businesses repay.