Furlough scheme extended and changed for new lockdown.

The Coronavirus Job Retention Scheme (CJRS) has been extended until December, with furloughed employees set to receive 80% of their salary for hours not worked and businesses asked only to cover national insurance and employer pension contributions. On 31 October Prime Minister Boris Johnson announced a new national lockdown for England that will run from 5 November until 1 December. The Prime Minister also confirmed that the CJRS has been extended for a further month. The CJRS was supposed to…

On 22 October Chancellor Rishi Sunak announced increases to the coronavirus (COVID-19) financial support measures first outlined in the Winter Economy Plan. The Chancellor has made amendments to the Job Support Scheme (JSS), which is set to take effect from 1 November. When originally announced, the JSS saw employers paying a third of their employees’ wages for hours not worked, and required employers to be working 33% of their normal hours. The Chancellor’s latest announcement has reduced the employer contribution…

The government’s Job Support Scheme (JSS) will be expanded to protect jobs and support businesses required to close their doors due to local lockdowns as the number of coronavirus (COVID-19) cases continues to rise in some areas. Under the JSS extension the government will pay two thirds of employees’ salaries to protect jobs over the coming months. Cash grants for businesses required to close as a result of local lockdowns are being increased to up to £3,000 per month. Under…

The government’s announcement of new cash grants for businesses affected by local lockdowns has been welcomed by business groups, including the Confederation of British Industry (CBI) and the Federation of Small Businesses (FSB). Businesses in England that are required to shut because of a local lockdown will now be able to claim up to £1,500 per property every three weeks. However, both the CBI and the Association of Independent Professionals and the Self-Employed (IPSE) have warned that more targeted help…

The Self-Employment Income Support Scheme (SEISS) has opened for applications for the second and final grant. Under the scheme, the government pays self-employed individuals a taxable grant based on an average of their earnings over the past three years. The grant covers up to 70% of earnings, up to a limit of £2,190 a month. The eligibility criteria for the second grant are the same as for the first one. To be eligible, self-employed workers must have filed a tax…

The Institute of Chartered Accountants in England and Wales (ICAEW) has warned taxpayers that they have 90 days to notify HMRC of overclaimed coronavirus (COVID-19) grants. The 90-day period to inform HMRC of any overclaimed amounts is now law: Finance Act 2020 recently received Royal Assent, which confirms the taxability of the Coronavirus Job Retention Scheme (CJRS), as well as the Coronavirus Statutory Sick Pay Rebate Scheme and COVID-19 business support grants. Finance Act 2020 also gives HMRC the power…

The Institute of Chartered Accountants in England and Wales (ICAEW) has urged businesses to ensure that they understand the interaction between VAT and the government’s Eat Out to Help Out scheme. The new Eat Out to Help Out discount is applicable to food and/or non-alcoholic drinks purchased for immediate consumption on premises, up to a maximum discount of £10 per diner, which includes VAT. The discount can be used unlimited times and is valid Monday to Wednesday on any eat-in…

The Federation of Small Businesses (FSB) has called for the government to provide further help to employers as the Coronavirus Job Retention Scheme (CJRS) begins to be wound down. From 1 August, employers have to pay national insurance contributions (NICs) and pension contributions for furloughed employees. Starting from this date the level of the grant will be reduced each month. Employers will take on an increasing proportion of pay for employees who are furloughed. The CJRS will close at the…

Changes to state aid rules mean that more small businesses can benefit from the government’s Coronavirus Business Interruption Loan Scheme (CBILS). As a result of EU rules, previously small firms in the ‘undertakings in difficulty’ category were unable to make use of the CBILS. From 30 July businesses in undertakings in difficulty with a turnover of less than £9 million and fewer than 50 employees can apply for a loan under the CBILS. Commenting on the issue, John Glen, Economic…

Retail sales were broadly flat in the year to July despite three months of sharp declines, according to the monthly Distributive Trades Survey published by the Confederation of British Industry (CBI). However, the improvement was primarily driven by stronger grocery sales, with non-essential retailers continuing to struggle despite the easing of lockdown restrictions. Alongside higher grocery volumes, sales of hardware and DIY products, other normal goods (including cards, flowers, stationary) returned to growth in the year to July. Other retailers,…