Hello Everyone
I know this is two emails in two days – sorry about that.
I thought it was worth dropping you a line just to let you
know about the Chancellor’s announcement a few minutes ago if you didn’t hear
it.
Although (as always) there’ll be more details to follow,
five high level announcements about ongoing support were announced by the
Chancellor a little while ago.
We’ll fill in the gaps when we get the detail and some of
what I’m about to write is what I got from the live speech so may be subject to
change when we get more info.
Anyway, here goes:
Job Support Scheme
This scheme is replacing the Job Retention Scheme – also
known as the furlough scheme – which is going to end on 31st
October.
The new scheme is designed to protect jobs so will only be
available if employees are retained and actually working for at least 1/3 of
their usual hours. Employees must be paid as usual for the hours they
actually work.
Up to 1/3 of their usual salary will then be paid by the
government meaning employees will get at least 2/3 of normal pay. This is
capped at £697.92 per month.
All small businesses will be eligible if employees have to
work less hours because of Coronavirus – whether or not the employer has used
the furlough scheme in the past.
The Job Support Scheme will begin in November and more
details are to be published.
Government Backed Loans
Some of the repayment terms have changed on the Bounce Back
Loan.
Payments can now be taken over ten years – up from six years
and can be changed if, for example, your business starts to grow again. A
borrower can also change to an interest only option or suspend payments for up
to six months altogether.
There’s a change to CBILs too. The government
guarantee has been extended to ten years which should (according to Rishi) make
it easier for lenders to say ‘yes’.
Deferred Tax Bills
Some businesses chose to defer VAT and self employed people
deferred Payments on Account.
These deferred payments were due to be paid by 31st
March 2021 and 31st January 2021 respectively. The government
is now allowing deferred VAT bills to be paid over 11 smaller instalments with
no interest and the tax bills over 12 months.
VAT Reduction for Hospitality
Businesses in hospitality have had a reduction in VAT rate
to 5%.
This reduction was due to be cancelled on 13th January
2021. The reduction will now be in place to 31st March 2021.
Self Employed Income Support Scheme
I have to say there was one line about support for the self
employed which I almost missed.
However, There will be an additional grant for people who
are already eligible for the SEISS and who are seeing reduced demand because of
Coronavirus.
The grant will cover three months from November to January
next year and will pay 20% of average profits up to £1,875. There’s a
second grant (which may be adjusted) that will cover February to end of April
next year.
Phew!
We now need to work through the detail of all this but
hopefully there’s some good news in there for you from whatever scheme is being
put in place.
As we get more info we’ll write out again but please do ask
questions if you have any… I’ll most likely collate the questions and put out
as an update email next week.
Speak soon.
Rowena
