Harts CHARTERED ACCOUNTANTS

Coronavirus support update – Further financial support in the new lockdown

4th Nov
Self Employed

Further Financial Support in the New Lockdown

On Saturday, the press and then Boris Johnson announced that England would be going into lockdown, with a host of business closures, for four weeks from 5th November.

Although there is still limited detailed guidance over the scope of the required business closures and the financial support available, information has started to come out from the government.

Universities, schools, nurseries, and childcare generally are expected to be allowed to remain open, but the government has announced that it is mandating the closure of all non-essential retail, indoor and outdoor leisure facilities (except children’s playgrounds), hospitality and entertainment venues, and personal care facilities (eg hairdressers, salons etc).

Although hospitality venues will be required to close, they will be allowed to remain open for takeaway (except alcohol).

Extension to the Furlough Scheme

The furlough scheme was due to end on Saturday. But late on Saturday, it was announced that it would be extended until the end of the new lockdown (currently scheduled for 12.01 am on 2nd December). This month and a day extension are on the same basis as the furlough scheme operated in August. It will be flexible and will pay employees up to 80% of their current salary for unworked hours up to a maximum of £2500 per month.

Employers will be required to pay employees their normal pay for hours worked and the Employer NIC and pension contributions for unworked hours. Employers will be able to top-up the earnings of those on furlough.

To qualify for the scheme employees must have been paid through payroll on or before 30th October 2020 (not 20th March as was previously the case). There is also no requirement for the employee to have been furloughed previously.

Given most employers pay staff at the end of the month, it is unlikely that there will be many cases where an employee has joined shortly before the cut-off but fails to qualify because they had not yet been paid for the first time. This led to a number of employees failing to qualify under the previous furlough scheme.

It is not yet known when claims will be able to be made under the scheme extension. It is anticipated that furlough claims for the period up to 31st October will be required to be made before 30 November.

See more information on the furlough scheme extension and support

Support for the Self Employed

It has been announced that the self-employed grant will be increased to 55% (from 40%) of trading profits to a maximum of £5160 for the period from November to January. The intention is that it covers 80% of trading profits for a one-month lockdown period and 40% of trading profits for the other two months.

See details for the Self Employment Support Extension

Business Support Grants

Any business premises in England which are legally forced to close as a result of either the local or national restrictions will be eligible for the following grants. These grants are the same as those available to closed businesses under the previous Tier 3 regime:

  • For properties with a rateable value below £15,000, £1,334 per month
  • For properties with a rateable value of between £15,000-£51,000, £2,000 per month
  • For properties with a rateable value over £51,000, £3,000 per month.

Mortgage Holidays

Mortgage payment holidays will no longer end on 31st October. Borrowers who have been impacted by the coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.

Working from Home

If you have employees who are working from home then you are able to pay them up to £6 per week tax free (£312pa, £26 per month) tax free to reimburse them for the additional costs of working from home. There is no obligation on the employer to pay this (and even without the payment many employees are better off working from home once commuting costs are taken into account). Where an employer chooses not to make this payment, the employee is able to claim tax relief on it by way of a claim to HMRC.

Business owners usually have made this claim for some years through the “Use of the home as office” adjustment in the company’s annual accounts.

Harts Webinar Series: Success in a Changing Landscape

We continue our series of seven fortnightly interactive webinars to help keep your business agile, proactive and thriving in uncertain times. Each 45-minute sessions, hosted by Steven Glicher and guests, are designed to provide practical, really useful information and the opportunity to discuss any issues raised.

Our next seminar ‘Discussion Group’ will be held on Tuesday 17th November. In the meantime visit our YouTube page to catch up on all the previous webinars in the series including this weeks seminar ‘Value & Pricing’.

Cheadle Office is now Open

Our Cheadle office is now open with restricted hours, please contact us before visiting.

However, Macclesfield Office remains open normal hours.

Get in Touch

Call or email us at Harts if you have any queries about topics covered above or to find out more about our services at Harts, call us on 01625 669669 or email info@harts-ltd.com

Please follow us on LinkedIn for up to date information.

Take Care

The team at Harts