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Winter Economy Plan – What it means for the self-employed

The Winter Economy Plan includes the new Job Support Scheme and an extension to the SEISS grant. Both summarised below.

Job Support Scheme (JSS) to start 1 November 2020 to 30 Apr 2021

JSS will replace the CJRS which ends 31 October 2020

With the intention to protect only “viable” jobs the employer will continue to pay employees for actual hours worked whilst the cost of hours not worked will be split between the employer and the government. This means the employer will need to pay it’s employees a considerable amount more than the hours worked. Compared to CJRS / Furlough scheme government support is being cut from 80% to 22% of wages. Essentially, the scheme is aimed at employers that can’t afford to lose valuable, perhaps highly trained staff.

Eligibility

  1. Employees must have been employed and paid at least once before 23 September 2020
  2. Employees must be working at least 33% of their usual hours (this might be increased after 3 months)
  3. For every “usual” hour not worked the government and the employer will pay a third each.
  4. More detail including a chart showing the 1/3 calculations here: https://www.personneltoday.com/hr/job-support-scheme-fraction-revision-time/

And here: https://www.gov.uk/government/publications/job-support-scheme

Self-Employment Income Support Scheme (SEISS) grant extension

The extension of the SEISS grants is great news for the Self-Employing, including Partnerships affected by COVID19.

Two more grants are to be paid to those eligible with the intention of helping towards lost profits from Nov – Jan (covering 20% of average profits) and Feb – Apr (value of grant not yet confirmed).

Eligibility

  1. You must currently be eligible for SEISS grant 1 and 2 (i.e. have been adversely affected by Coronavirus for grant 1 anytime until 13 July 2020, for grant 2 between 14 July –  19 October 2020)
  2. You must be currently trading and intending to continue to trade
  3. You must be adversely affected between the grant extension period (from 1 Nov until the date of the claim). See here to help decide if you’ve been adversely affected by Coronavirus: https://www.gov.uk/guidance/decide-if-your-business-has-been-adversely-affected-for-the-self-employment-income-support-scheme

Worth remembering: The deadline to claim grant 2 is 19 October 2020. All such grants are taxable and will need to be declared on your Income Tax Returns.

How to claim: As with grants 1 and 2 it seems likely HMRC will contact each self-employed taxpayer.

Bounce Back Loan extension

The government will give all businesses that borrowed under the BBLS the option to repay their loan over a period of up to ten years. This will reduce their average monthly repayments on the loan by almost half.

Other previous COVID-19 posts remain relevant and are:

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