1. Job Support Scheme: introduced from 1 November to protect viable jobs in businesses who are facing lower demand over the winter months due to coronavirus.
- Will run for six months
- Employers will continue to pay the wages of staff for the hours they work – but for the hours not worked, the government and the employer will each pay one third of their equivalent salary.
- This means employees who can only go back to work on shorter time will still be paid two thirds of the hours for those hours they can’t work
- In order to support only viable jobs, employees must be working at least 33% of their usual hours. The level of grant will be calculated based on the employee’s usual salary, capped at £697.92 per month.
- The Job Support Scheme will be open to businesses across the UK even if they have not previously used the furlough scheme
- It is designed to sit alongside the Jobs Retention Bonus and could be worth over 60% of average wages of workers who have been furloughed – and are kept on until the start of February 2021. Businesses can benefit from both schemes in order to help protect jobs.
2. SEISS extended: extension of the Self Employment Income Support Scheme Grant (SEISS).
- An initial taxable grant will be provided to those who are currently eligible for SEISS and are continuing to actively trade but face reduced demand due to coronavirus.
- The initial lump sum will cover three months’ worth of profits for the period from November to the end of January next year. This is worth 20% of average monthly profits, up to a total of £1,875.
3. Tax cuts and deferrals
- Extend the temporary 15% VAT cut for the tourism and hospitality sectors to the end of March next year.
- New Payment Scheme for VAT: gives businesses the option to pay back in smaller 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.
- 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.
4. Pay as You Grow
- A new Pay as You Grow flexible repayment system. This will provide flexibility for firms repaying a Bounce Back Loan.
- Extends the length of the loan from six years to ten, which will cut monthly repayments by nearly half.
- Interest-only periods of up to six months and payment holidays will also be available to businesses.
- Intend to give Coronavirus Business Interruption Loan Scheme lenders the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan.
In addition, the Chancellor also announced he would be extending applications for the government’s coronavirus loan schemes. As a result, more businesses will now be able to benefit from the Coronavirus Business Interruption Loan Scheme, the Coronavirus Large Business Interruption Loan Scheme, the Bounce Back Loan Scheme and the Future Fund. This change aligns all the end dates of these schemes, ensuring that there is further support in place for those firms who need it.