I've blogged recently about both the Coronavirus Job Retention Scheme (commonly known as Furlough) and the Self-Employed Income Support Scheme (SEISS) being extended. Now we have more detail, I can tell you what's changed ...
These Furlough payments will be capped at £2,500, and employers will remain responsible for National Insurance and pension contributions. CJRS will be reviewed at the end of January with the Chancellor saying that, "it is clear the economic effects of COVID-19 are much longer-lasting than any lockdown restrictions".
This is great news for employees of businesses affected by the pandemic, but economists project that by the end of March 2021, up to 5 million employees may have been furloughed.
As usual, the employee must be included on an RTI submission before the 1st November, and it is advisable that employers check their employment contracts to cover these changes to Furlough, with the Government stating that a retrospective agreement would be acceptable in light of the speed that lockdown 2.0 happened.
The other good news for self-employed people is that the Self-Employment Income Support Scheme is also being extended in line with CJRS for employees. Instead of the 80% of trading profits for November and 40% for December and January, the Chancellor announced that HMRC would use 80% of trading profits from all three months instead, up to a maximum of £7,500. This is in line with the 1st SEISS grant you may have claimed, so you'll have an idea of what you'll receive.
The eligibility requirements remain the same now, so if you were eligible for the first and second grants, you will be eligible for this one and possibly the fourth one later in 2021, providing that the Chancellor's review of CJRS and SEISS doesn't tighten things up in January.
HMRC should be sending out initial emails around now to self-employed taxpayers who have registered for previous grants. More details will be emailed to you from 23rd November onwards, and it should include a date from which you can make your claim.
As with all the Government's support schemes, this depends on the economic circumstances of the United Kingdom. Hopefully, a vaccine will be released in the new year, allowing us to return to some sort of normal towards the middle of next year.
Don't forget the Government has also announced a raft of other measures, including cash grants for closed businesses, one-off payments via Local Authorities, plans to top up Bounce Back Loans and extended mortgage repayment holidays.
I'll blog more about those as information become available.
If you feel inspired to find out more about anything I've said here, do call me on 01908 774320 or leave a comment below and I'll be in touch as soon as I can.