Second Lockdown…the latest announcements

2nd November 2020

Extension of the Job Retention (Furlough) Scheme

 The government announced this scheme will extend into November 2020. Initially, this scheme was to end in October 2020 and was going to be replaced with the Job Support Scheme.

For November 2020 the scheme will be more generous for employers compared to the scheme payments awarded in October 2020. For November 2020, the government will fund 80% of the wage bill for furloughed staff, plus there will be no obligation for employers to top up part of the furloughed wages. These payments will be capped at £2,500 per month.

The grant awarded under this scheme will be identical to the payments awarded in August 2020.

It is worth noting though, that employers will still be required to fund the pension and employers national insurance contributions due. Also payments received under this scheme will be treated as taxable income for the employer.

The current understanding is that when lockdown comes to an end the job support scheme will be re-introduced and employees will be required to work a minimum 20% of their hours.

Who is Eligible for Job Retention Scheme Payments

To be eligible for these payments, the employee concerned must have been on the payroll before 30 October 2020. This means an RTI submission must have been made for that employee before the end of 30 October 2020.

The employee concerned can be on any type of contract.

Crucially though, there is no requirement for that employee to have been previously furloughed. So furlough payments can be made for staff who have never been previously placed on this scheme.

As before when an employer makes a claim, the claim made will need to be made for 7 consecutive calendar days (as a minimum). The employer will still bear the full responsibility for paying the tax and NIC due on actual hours worked by the employee.

Further Information on the Job Retention Scheme

Flexible furloughing is permitted as before.

  • The employer can still top up wage payments if they so wish.
  • The government are expected to shortly announce when these claims may first be made for November 2020.

Self-Employment Income Support Scheme (SEISS)

The Chancellor has recently announced today that the self-employed scheme payments will double, with self-employed individuals now being able to receive 80% of trading profits for November. We await more details but the expectation is that payments for December 2020 and January 2021 will return to 40%.

It is also our understanding The claims window will also be brought forward to 30 November 2020

Business Grants

These will be awarded to businesses that are required to close in England. Grants awarded in other parts of the UK will be dealt with by the applicable devolved administration.

It is worth mentioning that these payments awarded will be taxable income for the recipient.

The government have yet to announce how businesses will be able to claim these grants. It may well be that as in the past local authorities will directly contact eligible businesses, however we will keep you posted.

Level of Grants Awarded to Businesses Required to Close in England

  • Businesses with properties with a rateable value of £15,000 or under will receive £1,334 per month or £667 per two weeks.
  • Businesses with properties with a rateable value between £15,000 – £51,000 will receive £2,000 per month or £1,000 per two weeks
  • Businesses with properties with a rateable value in excess of £51,000 will receive £3,000 per month or £1,500 per two weeks.

We are here to help and advise you, get in touch with a member of our team…here

Sign up and stay informed