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Individuals and businesses across the UK are receiving additional financial support as part of the government’s plan for the next phase of its response to the coronavirus outbreak, the Prime Minister announced today (October 31).
Throughout the crisis, the government’s priority has been to protect lives and livelihoods. Today, the Prime Minister said that the government’s Coronavirus Job Retention Scheme (CJRS), also known as the Furlough program, will remain open until December, and employees will receive 80% of their current pay for hours not worked, up to a maximum of £ 2,500. Under the expanded scheme, the cost to employers of retaining workers will be reduced compared to the current scheme, which ends today. This means that the extended leave plan is more generous for employers than in October.
In addition, business premises that are forced to close in England will receive grants worth up to £ 3,000 per month under the Local Restrictions Support Grant. In addition, £ 1.1 billion is being awarded to local authorities, distributed on the basis of £ 20 per head, for one-time payments to enable them to support businesses more widely.
To give homeowners peace of mind, the mortgage vacation won’t end today either.
Chancellor Rishi Sunak said:
During the last eight months of this crisis, we have helped millions of people continue to support their families. But now, along with many other countries in the world, we face a harsh winter ahead.
I have always said that we will do whatever it takes as the situation evolves. Now, as restrictions tighten, we are taking steps to provide more financial support to protect jobs and businesses. These changes will provide a vital safety net for people across the UK.
Labor retention scheme
Small or large charitable or non-profit employers are eligible for the Extended Employment Retention Plan, which will continue for one more month.
Businesses will have the flexibility to have employees who have been discharged go back to work part-time or cancel full-time, and will only be required to cover contributions to National Insurance and employer pensions that, for the average claim , represent only 5% of the total. employment costs.
The Employment Support Program, which was scheduled for Sunday, November 1, has been postponed until the end of the licensing program.
Additional guidance will be offered shortly.
Mortgage holidays
The mortgage payment holidays will no longer end today. Borrowers who have been affected by the coronavirus and have not yet had a mortgage payment holiday will be entitled to a six-month holiday, and those who have already started a mortgage payment holiday will be able to recharge up to six months without this being recorded on your credit file.
The FCA will announce more information on Monday.
Business grants
Businesses that are required to close in England due to local or national restrictions will be eligible for the following:
- For properties with a taxable value of £ 15k or less, the grants should be £ 1,334 per month or £ 667 for two weeks;
- For properties with a taxable value between £ 15k and £ 51k, the grants will be £ 2,000 per month or £ 1,000 for two weeks;
- For properties with a taxable value of £ 51k or more, grants should be £ 3,000 per month or £ 1,500 for two weeks.
Today’s announcements are just one part of the government’s leading global economic response to the coronavirus, the largest emergency support package in postwar history, to protect, create and support jobs.
The licensing scheme protected over nine million jobs across the UK, and the self-employed have received over £ 13 billion in support. This adds up to billions of pounds in tax deferrals and business grants.
More information
SUBSIDIES
- The business subsidy policy is completely transferred. Decentralized administrations will receive the consequences of Barnett that they could use to establish similar schemes.
JOB RETENTION SCHEME
- This Expanded Job Retention Plan will work as the previous plan did, and employers will be prepaid to cover salary costs. There will be a short period when we need to change the legal terms of the scheme and update the system and companies will receive late payments during that period.
- the CJRS it is extended until December. The level of the grant will reflect the levels available in the CJRS in August, so the government will pay 80% of wages up to a limit of £ 2,500 and employers will pay the employer’s national insurance contributions (NIC) and pension contributions only for the hours the employee does not work.
- As under the stream CJRS, the flexible license will be allowed in addition to the full-time license.
- More details will be provided shortly, including how to claim this extended support through an updated claims service.
- The Employment Support Plan will be introduced after the end of the CJRS.
Who is eligible?
Employers
- All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee must have previously used the CJRS.
- The government hopes that publicly funded organizations will not use the scheme, as has already been the case with CJRS, but partially publicly funded organizations may be eligible when their private income has suffered. All other eligibility requirements apply to these employers.
Employees
- To be eligible to be claimed under this extension, employees must be on the employer’s PAYE payroll by 11:59 p.m. on October 30, 2020. This means that a real-time information submission (RTI) must have been performed. Notifying the HMRC of that employee’s pay on or before October 30, 2020.
* As in the stream CJRS rules: - Employees can have any type of contract. Employers may enter into employment agreements with employees.
- Employers can claim the subsidy for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. These calculations will broadly follow the same methodology that is currently CJRS.
- By claiming the CJRS allowance for hours off, employers must report and claim for a minimum period of 7 consecutive calendar days.
- Employers must report the hours worked and the usual hours an employee is expected to work in a claim period.
- For the hours worked, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NIC owes on those amounts.
What support is provided and employer costs:
- For hours not worked by the employee, the government will pay 80% of wages up to a limit of £ 2,500. The grant must be paid to the employee in full.
- Employers will pay the employer NIC and pension contributions, and you must continue to pay the employee for the hours worked in the usual way.
- As with the current CJRS, employers can still choose to top up employee wages above the plan grant on their own, if they choose.
- The Government will confirm shortly when claims regarding employee salary costs may first be filed during November, but there will be no gap in eligibility for support between the previously announced end date of CJRS and this extension.
