Business support in lockdown 2.0

WE LVE NUMBERS!

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News of a second lockdown has left many uncertain about what the future holds. Here Andrew Diver, head of tax at Beatons, explains what staff and employers can expect in financial support from the Government over the next month.

England is heading towards Lockdown 2.0 on Thursday, November 5, with businesses in the leisure and entertainment sector and non-essential shops forced to close their doors until early December.

Workplaces will stay open, but staff will be asked to work from home if they can.

Prime Minister Boris Johnson announced the news at a press conference on October 31, saying COVID-19 appeared to be spreading faster than the reasonable worst-case scenarios modelled by the Government’s scientific advisors.

Stay at home is the big message, however this time schools, childcare, colleges and universities will remain open throughout lockdown.

Although the public had caught wind of an upcoming lockdown earlier than the PM had intended – it has left many worrying about their finances.

Furlough scheme extended

The good news is the Government’s Coronavirus Job Retention Scheme (CJRS) which was due to end on Halloween will be extended until early December. 

The scheme looks to help businesses retain as many of their workers as they can by allowing firms to claim back 80% of wages for furloughed staff, up to £2,500 a month.

Employers will pay their employees’ National Insurance and pension contributions and would pay staff as normal for hours worked.

Businesses premises forced to close as a result of the lockdown will receive grants worth £3,000 a month which they can claim from local authorities who will also be given additional funds to support businesses in their regions.

Chancellor Rishi Sunak had previously planned for the furlough scheme to be replaced with the Job Support Scheme (JSS). This was designed to support those still in work who have had their hours cut, with the Government contributing 62% of pay for unworked hours, with employers paying 5%.

However, in light of the new developments, the Government has decided to extend the original furlough period until Wednesday, December 2.

All employers who hold a UK bank account and UK Pay schemes can claim money from the Government.

Neither staff nor employer need to have previously used the furlough system to be able to claim and employees can be under any type of contract and still be eligible.

The Government has confirmed JSS will not start until CJRS closes and the country is out of national lockdown.

Self-employed support

To reflect the change to the furlough scheme, the support available for the self-employed has also been increased.
The Self Employment Income Support Scheme will be made more generous with self-employed workers receiving 80% of their average trading profits for November.

The payments will also be made more quickly with the claims window being brought forward from December 14 to November 30. This will ensure that those who cannot carry out their business or have suffered reduced demand due to the pandemic are supported over winter.

As SEISS grants are calculated over three months, the uplift for November to 80%, along with the 40% level of trading profits for December and January, increases the total level of the third grant to 55% of trading profits. The maximum grant will increase to £5,160.

We can help

If you or your business needs advice or assistance with these measures, get in touch by calling 01473 659777 or email info@beatons.co.uk to see how we can help.