The PM’s announcement on Saturday triggered a raft of changes to the financial support available to businesses during the ongoing COVID-19 pandemic.
With an increasing number of businesses mandated to close under the new lockdown restrictions, Boris Johnson confirmed that the Coronavirus Job Retention Scheme (CJRS) would remain open until December 2020, with the new scheme being far more generous to employers than what was on offer in October.
Here’s what you need to know about the extension to the furlough scheme:
- The level of the grant will mirror that which was available under the CJRS in August
- The Government will pay 80% of wages, up to a cap of £2,500 and employers will pay employer National Insurance Contributions (NICs) and pension contributions only for the hours the employee does not work
- Businesses will have the flexibility to bring furloughed employees back to work on a part-time basis or furlough them full-time, and will only be asked to cover National Insurance and employer pension contributions which, for the average claim, accounts for just 5% of total employment costs
- To be eligible, employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020
- The Government will soon confirm when claims can first be made in respect of employee wage costs during November, but there is to be no gap in eligibility for support between the previously announced end-date of CJRS and this extension
More information concerning who is eligible and the support available to employers and employees can be found here: https://www.gov.uk/government/news/furlough-scheme-extended-and-further-economic-support-announced
Further details, including how to claim this extended support, will be announced shortly.
The Job Support Scheme, which was scheduled to come into force yesterday [Sunday 1st November], has been postponed until the furlough scheme ends.
Business Grants
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, or £667 per two weeks
- For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks
- For properties with a rateable value of £51k or over grants to be £3,000 per month, or £1,500 per two weeks
Mortgage Holidays
Mortgage payment holidays will no longer come to an end as planned. Borrowers who have been impacted by the Coronavirus and have not yet had a mortgage payment holiday will be entitled to a six-month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.
The FCA will announce further information on this today [Monday 2nd November].
As always, we will continue to keep you up to date with the latest news and announcements.
To discuss any of the above announcements in detail, then please contact your Champion adviser.
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