Furlough & Self Employed Grant extension
Chancellor’s statement announced today (5 November 2020).
We’ve covered the Chancellor’s statement regarding important updates to the Furlough Scheme, Self employed Grant increase and what this means for businesses – find out here.
Today’s statement at a glance:
• The Coronavirus Job Retention Scheme is extended until the end of March 2021
• The Job Retention Bonus will therefore be replaced with a new incentive
• The third self-employed grant, covering November to January, is increased from 55% to 80% of trading profits.
• The upfront guarantee of funding for the devolved administrations increased from 14bn to 16bn.
Furlough Scheme extended till March 2021
The Furlough scheme will be extended until the end of March, with employees to continue to receive 80% of their usual salary for hours not worked, up to £2,500 a month.
Employers will only have to pay National Insurance and Pension Contributions.
The policy will be reviewed in January 2021 to decide whether economic circumstances are improving enough to ask employers to contribute more.
For employers and employees eligibility and ways to claim the extended CJRS, click here.
Job Retention Bonus
As the Furlough Scheme is being extended to the end of March 2021, the £1,000 Job Retention Bonus, designed to incentivise employers to keep workers on the payroll until the end of January,
will fall away.
The Government will instead redeploy a retention incentive at the appropriate time.
Chancellor Rishi Sunak said:
‘As we saw from the first lockdown, the economic effects are much longer lasting for businesses and areas than the duration of any restrictions. The support we are providing will protect millions of jobs’
Self-employed Grant Increase
The payment will increase to 80% for the whole of the third grant
The overall level of the self-employed grant will increase to 80% of 3 months trading profits, covering November to January for all parts of the UK. The grant will be paid out in a single instalment and capped at £7,500.
Applications for payments will also be brought forward from December 14 to November 30.
A fourth grant will cover a three-month period from the start of February until the end of April 2021, with the government to review and set this in due course.
For further information on eligibility and ways to claim the grant, click here.
Business Loans (Govt backed)
The announcement follows recent news that the deadlines for applications for government-backed loan schemes and the Future Fund have been further extended until January 31, 2021. For further info, read our recent blog here.
Sunak also confirmed that the upfront guaranteed funding for the devolved administrations is increasing from £14bn to 16bn, while the extension of CJRS, SEISS grants, loans and mortgage
holidays are all UK-wide.
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