Following Rishi Sunak’s Winter Economy plan latest announcement here are the current changes:

1.Furlough scheme confirmed to end on 31st October

2. A new Job support scheme will replace furlough scheme on 1st November and will last 6 months

    • This will see workers get three quarters of their normal salary
    • Workers must do at least one third of their normal hours
    • Employers pay staff for the hours they work
    • The government and employer will each pay a one third for the hours they cannot work
    • Therefore someone working one third of their hours will receive 77% of their pay
    • The grant is capped at £697.92 per month
    • The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
    • Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.
    • It will be open to employers across the UK even if they have not previously used the furlough scheme
    • It means the government will pay a maximum of 22% of someone’s wages, down from 80% at the start of the furlough policy
    • More information can be found on the HMRC factsheet at HMRC JSS Factsheet

 

3.The chancellor is extending the self-employed grant on similar terms to the Job Support Scheme

    • A grant will be available to those eligible for the Self Employment Income Support Scheme Grant
    • The grant will cover three months’ worth of profits for the period from November to the end of January
    • It will cover 20% of average monthly profits up to a total of £1,875
    • A further grant may be available to the self-employed to cover February 2021 to the end of April, depending on circumstances
    • The grants are subject to Income Tax and National Insurance Contributions.

 

4.Bounce Back Loans will be extended from six years to 10, cutting monthly repayments by nearly half

    • Coronavirus Business Interruption Loan Scheme lenders will also be able to extend the length of loans from the current maximum of six years to 10 years
    • The chancellor is also extending the deadline for the government’s coronavirus loan schemes to the end of November
    • Businesses struggling can choose to make interest only payments for six months and those “in real trouble” can apply to suspend repayments altogether for six months
    • Businesses will not see their credit rating fall as a result, the chancellor says

 

5.The 15% emergency VAT cut for the tourism and hospitality industries will be extended from January 2021 to 31 March.

  • This means VAT for this sector is reduced from 20% down to 5%
  • Businesses who deferred their VAT bills will be able to pay back their taxes in 11 smaller interest-free instalments
  • Rather than paying a lump sum in full at the end March next year, they will be able to make 11 smaller interest-free payments during the 2021-22 financial year.

 

6.Self-assessment income taxpayers who need to will be given more time to pay

  • additional 12-month extension from HMRC on the “Time to Pay” self-service facility, meaning payments deferred from July 2020, and those due in January 2021, will now not need to be paid until January 2022.

 

 

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