Coronavirus (COVID-19) Job Retention Scheme – new rules from 1 July
On Friday evening the Chancellor announced three changes to the Job Retention Scheme as well as an extension to the Self-Employed Income Support Scheme (the self-employed can skip ahead to that section).
The changes are outlined here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
Detailed guidance on the new rules is expected to be published 12 June.
Job Retention Scheme – new rules starting 1 July
1. From 1 July 2020, the scheme will be made more flexible to enable employers to bring previously furloughed employees back part time and still receive a grant for the time when they are not working.
2. From 1 August 2020, employers will have to start contributing to the wage costs of paying their furloughed staff and this employer contribution will gradually increase in September (govt will fund 70%) and October (govt will fund 60%).
3. The scheme will close to new entrants from 30 June.
Employers: What to do now?
The final date by which an employer can furlough an employee for the first time will be 10 June (in order to complete the minimum 3 week furlough by 30 June).
As some employers have been rotating their furloughed workers then they should consider now if any workers that haven’t yet been furloughed can be furloughed before 10 June in order to leave the door open to the flexible furloughing (part-time) rules starting 1 July.
Extension to the Self-Employed Income Support Scheme (SEISS)
The Chancellor also announced plans to extend the Self-Employment Income Support Scheme (SEISS) for those people whose trade is adversely affected by COVID-19 (coronavirus). Eligible self-employed people will be able to claim a second and final SEISS grant in August; this will be a taxable grant worth 70% of their average monthly trading profits for three months, paid out in a single instalment and capped at £6,570 in total.
If you make a claim for the second grant you will have to confirm your business has been adversely affected on or after 14 July 2020 (PER GOV.UK 12 JUNE UPDATE). People do not need to have claimed the first grant to claim the second.
Self-Employed: What to do now?
Claims for the first SEISS grant, which opened on 13 May, must be made no later than 13 July. Eligible self-employed people must make a claim before that date to receive the first SEISS grant (a taxable grant of 80% of their average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total).
My previous COVID-19 posts can be found here:
- You’ve claimed the SEISS grant – What next?
- COVID-19 Self-Employed Income Support Scheme (SEISS): Get ready to claim
- COVID-19 Job Retention Scheme – Advice for Company Directors
- What financial support is available for UK businesses? – NOW UPDATED
- Can the Self-Employed go to work?
- Help for the Self-Employed and other FAQ’s
- Coronavirus (COVID-19): Help for the Self-Employed – PER THE 26 MARCH ANNOUNCEMENT
Enjoy saving tax?