27 Sep Job Support Scheme and Furlough Changes
Job Support Scheme – Winter Economy Plan
Following Rishi Sunak’s announcement that there will not be an autumn budget, the chancellor has released the Winter Economy plan which details a series of further measures to help businesses during the continuing Coronavirus pandemic.
One of those is the Job Support Scheme which will replace the furlough scheme. The current furlough scheme ends on 31st October 2020 with the new Job Support Scheme starting on 1st November 2020 and lasting for 6 months.
Please remember that employer contribution for furlough in October 2020 is 20%, with the CJRS grant 60%. The employee must receive 80% of their normal wages capped at £2,500. You can find more here.
We have outlined the main points below:
Job Support Scheme
- Begins 1 November 2020 and lasts for 6 months
- Employers must be on an employers PAYE scheme and have a UK bank account.
- Employees/employers who have not previously been furloughed can use the scheme.
- Employees need to work a minimum of 33% of their normal workings hoursThe employees in the scheme will receive at least 77% of their pay where the scheme is not capped
- For every hour not worked the employer will pay 1 one third and the government will pay one third, the government contribution will be capped at £697.92 per month
- The employer will be reimbursed in arrears for the government contribution
As with all the government schemes there will be specific criteria, some of which can be found here.
There is also an extension of the SEISS, VAT and Payment of Personal Tax:
SEISS Grant Extension
- Covers November – April 21 with 2 taxable grants
- Nov 20 – January 21 – 20% of average monthly trading profits up to £1875 in total
- 2nd Grant – February 20 – April 20 to be reviewed.
- 5% VAT rate for Hospitality and Tourism extended to 31st March 2021
- VAT deferral for VAT due March – June 2020 – businesses can spread payments over 2021-2022 with 11 equal instalments.
Personal Tax Liability under 30k
- Use HMRC ‘Time to Pay‘ to organise a payment plan for tax owed in January 2021 – personal tax liabilities due from July 20 will not need to be paid in full until January 2022. (Please note – this has to be agreed with HMRC under their Time to Pay Scheme)
The full government Winter Economy Policy can be found here.
As with all Schemes, Grants and Loans conditions will apply.
How can EA Assist help?
We have worked with businesses throughout these changing times and continue to provide fully managed outsourced payroll. With the right expertise and software we are able to offer a cost effective outsourced payroll solution freeing up your valuable time to run your business. If you would like help with your payroll function please talk to us.
Our outsourced payroll packages are tailored to suit your needs. Whether you have 1 or 100 staff we will have a plan to suit your specific requirements.
Making sure you file on time and accurately, and providing reports as and when you need them. We can offer a range of pay solutions for your staff including printed or e-payslips.