New National Restrictions from 5 November
As you’ll know, on Saturday evening the government announced new National Restrictions starting 5 November. Details of which can be found here: https://www.gov.uk/guidance/new-national-restrictions-from-5-november
The government has also announced the following financial support during this period.
Financial support for employers / employees
The details are found here: https://www.gov.uk/government/news/furlough-scheme-extended-and-further-economic-support-announced and summarised below. Undoubtedly there will be updates to this guidance as right now exactly how it will all work is unclear.
• The Job Support Scheme (JSS) due to start 1 November will not now start when the Coronavirus Job Retention Scheme (CJRS) (aka furlough) ends
• The CJRS (which had ended 31 October) will continue to operate until 30 November
• The CJRS grant will pay for 80% of the furloughed employee’s current wages, up to £2,500 per month. The employer must pay for all of the employer’s NIC and employer’s minimum workplace pension contributions on those wages.
• The employer can top-up the employee’s furlough pay at their own expense, if they wish to.
• The rate of 80% is much more generous than the 60% funding to which the scheme had been reduced by October.
• How exactly 80% is calculated and what pay-period is considered “current wages” is yet to be clarified (previously this was based on February’s salary). It seems likely that October’s salary will be the basis.
• Employees who were on the employer’s payroll and paid by 30 October 2020 will qualify to be included in CJRS claim for November; they don’t have to have been included in an earlier CJRS claim.
Other support for businesses – SEISS
UPDATE 2 NOV 2020 – The Self-Employed Income Support (SEISS) grant number 3 (helping towards profits for Nov – Jan 2020) has been increased to 55% of 3 months average profits. No news yet on the rate at which grant 4 will be paid. More detail on who qualifies see: https://masseyaccountingcompany.com/2020/10/05/winter-economy-plan-what-it-means-for-the-self-employed/
Businesses required to close in England due to local or national restrictions will be eligible for the following:
• For properties with a rateable value of £15k or under, grants to be £1,334 per month
• For properties with a rateable value of between £15k-£51k grants to be £2,000 per month
• For properties with a rateable value of £51k or over grants to be £3,000 per month
- Each of these grants is taxable – businesses and self-employed would do well to budget for future tax bills accordingly
- Record keeping – when claiming a grant remember to keep documentation showing evidence of how your business has been affected by COVID19. More detailed avoid here: https://masseyaccountingcompany.com/2020/05/18/seiss-grant-what-next/
- If you’re planning to place an employee on furlough for November you should document this fact by writing to the employee (and seeking their agreement) now
- If you planning on extending the furlough of an employee whose furlough ended 31 October 2020 then again you should agree this with your employee and write to them document this fact (an email will suffice in the case of furlough extensions)
- Payroll calculations – exactly how the 80% will be worked out is currently unknown. In order to use the scheme we’d recommend that you put the above HR paperwork in place now and let us know once you’ve done that. We’ll work out each employee’s 80% entitlement once more guidance is available
Other previous COVID-19 posts remain relevant and are:
- Winter Economy Plan – What it means for the self-employed
- COVID-19 £1,000 Job Retention Bonus
- You’ve claimed the SEISS grant – What next?
- COVID-19 Self-Employed Income Support Scheme (SEISS): Get ready to claim
- Coronavirus (COVID-19): Help for the Self-Employed – PER THE 26 MARCH ANNOUNCEMENT
- Help for the Self-Employed and other FAQ’s
- Can the Self-Employed go to work?
- What financial support is available for UK businesses? – NOW UPDATED
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