The Chancellor, Rishi Sunak announced today plans for recovery
- Plans include a new £2bn scheme to create thousands of job placements for young people
- The chancellor announces a temporary change to stamp duty – immediately increasing the threshold to £500,000
- Temporary cut to VAT on food, accommodation and attractions from 20% to 5% is announced
- Chancellor announces new job retention bonus for employers who bring back furloughed staff
- A £2bn “green homes grant” to help make homes more energy efficient is also unveiled
- “Eat out to help out” vouchers that will give diners 50% off their meals out, with conditions, for August
Self-Employment Income Support Scheme (SEISS)
This was due to end on 31st May 2020, but it has been announced that a second and final grant can be claimed in August 2020. The eligibility criteria are the same for both grants. If you are Self Employed or a partner in a partnership, you will need to confirm that your business has been adversely affected by coronavirus. You do not need to have claimed the first grant to receive the second grant as you may only have been adversely affected by COVID-19 in this later phase.
SEISS – First grant
Individuals can continue to apply for the first SEISS grant until 13 July. Under this grant, eligible individuals can claim a taxable grant worth 80% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total.
SEISS – Second claim
Applications for the second grant will open in August. Individuals will be able to claim a second taxable grant worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
Coronavirus Job Retention Scheme (CJRS)
The Chancellor, on 12 May 2020, announced the extension of the CJRS and how the CJRS will continue to support jobs and businesses as people return to work.
From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back part time. The Chancellor announced that businesses will be able to decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach for them. The businesses will be responsible for paying their wages while in work while still being able to claim CJRS grant for their normal hours not worked.
Employers can claim the grant for the hours their employees are not working calculated by reference to their usual hours worked in a claim period.
Closure to new entrants from July
The scheme will close to new entrants from 30 June. From this point onwards, employers will only be able to furlough employees that they have furloughed for a full three-week period prior to 30 June. Employers will have until 31st July to make any claims in respect of the period to 30 June.
From August 2020, the level of government grant provided through the job retention scheme will be slowly tapered to reflect that people will be returning to work. The scheme updates mean that the following will apply for the period people are furloughed:
- June and July: The government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
- August: The government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions.
- September: The government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500.
- October: The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500.
Coronavirus Statutory Sick Pay Rebate Scheme
The scheme will enable employers with fewer than 250 employees to claim coronavirus-related Statutory Sick Pay (SSP).
Employers are eligible to use the scheme if they are claiming for an employee who is eligible for sick pay due to coronavirus, they had a PAYE payroll scheme in operation before 28 February 2020 and they had fewer than 250 employees across all PAYE schemes on 28 February 2020
The repayment will cover up to two weeks of the applicable rate of SSP, and is payable if a current or former employee was unable to work on or after 13 March 2020 and entitled to SSP, because they either have had coronavirus, were self-isolating and unable to work from home or who were shielding because they have been advised that they are at high risk of severe illness from coronavirus.
Bounce Back Loans (BBL)
The BBL are proving to be a more straight forward way of raising funds to help kickstart businesses after the lockdown. The loan scheme commenced recently with the aim to help small and medium-sized businesses to borrow between £2,000 and £50,000. The government guarantees 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. After the 12 months a rate of 2.5% will apply. Loan terms will be up to 6 years. No repayments will be due during the first 12 months. Initially you needed to apply through your own bank, but a few banks are now allowing non-customers to apply. So, if you are turned down by one, others may be willing to lend.
The Coronavirus Business Interruption Loan Scheme (CBILS)
This scheme remains open and supports small and medium-sized businesses, with an annual turnover of up to £45 million, to access loans, overdrafts, invoice finance and asset finance of up to £5 million for up to 6 years.
VAT and Self-Assessment payments
Don’t forget, you can apply to HMRC to defer any VAT due for the period 20th March 2020 to 30th June 2020 as well as any Self-Assessment tax payable 31st July 2020.
HMRC introduced a business rates holiday for retail, hospitality and leisure businesses in England for the 2020/2021 tax year. No action is required, and this will apply to your council tax bill in April 2020 meaning that there would be no rates payable for those businesses for 2020/2021.
Cash Grants (non-refundable)
The retail, hospitality and leisure sectors in England can also apply for a cash grant. For rateable values of under £15,000, they will receive £10,000. Between £15,001 and £51,000, they will receive a grant of £25,000. No action is required as local authorities will write to eligible businesses.
Smaller businesses within the Small Business Rate Relief or Rural Rate Relief will receive grants of £10,000. You do not need to do anything. Your local authority will write to you if you are eligible for this grant.
Local Discretionary Grant Fund – Top-up to local business grant funds scheme
A discretionary fund has been set up to accommodate certain small businesses previously outside the scope of the business grant funds scheme. This additional fund is aimed at small businesses with ongoing fixed property-related costs. Local authorities have been asked to prioritise businesses in shared spaces, regular market traders, small charity properties that would meet the criteria for Small Business Rates Relief, and bed and breakfasts that pay council tax rather than business rates.
There will be three levels of grant payments. The maximum will be £25,000. There will also be grants of £10,000. local authorities will have discretion to make payments of any amount under £10,000. It will be for councils to adapt this approach to local circumstances.
For ERYC and HCC – Claims can be made through the following links.
http://www.hull.gov.uk/hbdgf (but scroll to the bottom of the page)
Please note the ERYC grant’s closing date for phase 1 applications is Sunday 14 June and is limited to one application per business, sole trader, or charity.