Additional Covid-19 Business Support

Additional government support has been announced for businesses impacted by the on-going Covid-19 crisis

Job Support Scheme

A new Job Support Scheme will be introduced from the 1st November to protect jobs during the upcoming winter period whilst Covid 19 continues to affect business demand. The new scheme will run for six months and during it the government will contribute towards the wages of employees who are working fewer hours than normal. The employer will continue to pay wages for all hours worked by their employees, however for hours not worked, the employer and the government will each pay one third of their usual wages, capped at £697.92 per month. This will mean that employees will continue to receive at least two thirds of their usual wages for the hours not worked. This scheme will be open to employers even if they have not previously applied under the Coronavirus Job Retention Scheme (CJRS) which closes on the 31st October.

VAT Rate for Hospitality and Tourism

The government has extended the reduced 5% rate of VAT to tourism attractions and goods and services supplied by the hospitality sectors until the 31st March 2021.

VAT Deferral Scheme

If businesses deferred VAT payments which were due between March and June 2020, then these payments need to be made by the 31st March 2021. You can now use the New Payment Scheme to spread these payments over equal monthly instalments up to 31st March 2022. However, you can still make the payment in full by 31st March 2021.

Self-Assessment Time To Pay Scheme

Similarly to the VAT Deferral Scheme outlined above, if you deferred paying your July 2020 payment on account until the 31st January 2021, you can set up a Time To Pay payment plan of up to 12 months online, without calling HMRC, as you would normally need to do. This application will receive automatic approval for all debts of under £30,000.00.

Coronavirus Job Retention Scheme (CJRS)

The current furlough scheme ends on the 31st October 2020. Under this scheme the government pays 60% of employees normal wages up to a cap of £1,875.00 per month for hours furloughed employees do not work. Employers need to continue to pay furloughed employees at least 80% of their usual wages for hours they do not work, up to a cap of £2,500.00 per month. The employer must fund the difference between this and the CJRS grant. For example, if an employee is furloughed for half their usual hours during October, the employer is entitled to claim 60% of their usual wages for the hours the employee does not work, up to £937.50 (half of the £1,875.00 cap). Employers must still pay employees at least 80% of their usual wages for the hours they do not work, so for an employee only working half their normal hours, the employer would need to pay them up to £1,250.00 (half of the £2,500.00 cap), with the employer funding the remaining portion. Employers must continue to pay all employer NIC and Pension contributions in full.