COVID-19
Update 6 November 2020
Lockdown Financial Support
The latest as per the Chancellors Statement on 5 November and other announcements made in the previous week.
1.Job Retention Scheme
The Scheme has been extended until 31 March 2021. This replaces the previously announced Job Support Scheme which was due to come into effect in November.
The below details in terms of eligibility and criteria were confirmed for the original extension for November- further details are to be provided and we will update you when we have them.
Who is eligible?
- All Businesses
- Claims can be made for any employee if they are not on redundancy notice.
- Employees must be on the payroll on or before 30th October
- Employees can be furloughed full or part time
- Employees do NOT have to have been previously furloughed
- Employers do NOT have to have previously used the furlough scheme
How much can I claim?
The employer can claim up to 80% of an employee’s wages but they will remain responsible for the employers NI and pension contributions. This is up to the maximum of £2,500.
Employees can be flexibly furloughed so you can make a claim for furloughed hours.
When can I claim?
As with the existing scheme you can claim shortly before, during or after running payroll.
What records do I need to keep?
Employers must have;
- Written agreements with their employee that they have a temporary working arrangement for the reduced hours. (This must cover more than a seven-day period).
- Records of their worked hours and usual hours – these records must be retained for five years.
I made someone redundant in October can I rehire them and put them on furlough?
Yes, anyone employed on or before 23 September who has since been made redundant can be re- hired and then furloughed in full for the month.
2.Job Retention Bonus
The previously announced Job retention bonus has now been withdrawn and will no longer be paid.
3.Self-Employed Grant
What’s changed?
To mirror the 80% furlough scheme for the period of lockdown the amount you will be eligible for has changed.
How much can I claim?
For the three months to January you will receive 80% of profits up to a maximum of £7,500.
With regards to the three months February to April the level of support is currently under review.
Who is eligible?
- Only those who were eligible for the previous scheme (even if they didn’t claim).
- You must be continuing to trade but are facing reduced demand due to COVID 19
When will I receive the money?
It will be released in two payments covering initially the three months to Jan 2021 and then the three months to April 2021.
The first payment will be available to claim from 30 November and according to the government will be paid “in good time for Christmas”. No set date with regards payment date at this point.
4.Business Grants
4.1 Grants for Business who are forced to close
What is it?
A grant worth up to £3,000 per four weeks.
Who is eligible?
Any business which is forced to close due to national or local restrictions which include non-essential retail, leisure, personal care, sports facilities, and hospitality businesses.
Are any businesses excluded?
Yes, they specifically mention businesses that can continue to trade because they do not depend on providing direct in-person services from premises and can operate their services effectively remotely (e.g. accountants, solicitors).
Also, any business that has chosen to close but was not mandated to do so by the government will not be eligible.
How much can I claim?
Grants will be directly linked to rateable value
- Rateable value of £15,000 or under, grants of £1,334 per month.
- Rateable value over £15,000 and below £51,000, grants of £2,000 per month.
- Rateable value of exactly £51,000 and over, grants of £3,000 per month
How do I claim?
Grants will be distributed by your local authority to keep an eye on their website.
4.2 Grants for businesses in Tier 2/3
What is it?
A grant up to £2,100 per month for businesses in certain sectors who are adversely affected in High alert areas.
Which sectors does this apply to?
Initial references are made to leisure, hospitality, and accommodation and events- those which are directly affected by restrictions on socialising.
Will this apply retrospectively?
Yes, this will be applied retrospectively to areas which have been subjected to higher restrictions prior to the recent Tier approach.
How much can I claim?
It will be up to Local Authorities to determine the amount, but they have been given government guidance to link grants directly to the rateable value of business premises.
This was broken down as follows: –
- Rateable value of £15,000 or under, grants of £934 per month.
- Rateable value over £15,000 and below £51,000, grants of £1,400 per month.
- Rateable value of exactly £51,000 and over, grants of £2,100 per month
What if I am in the supply chain to one of these sectors?
Local Authorities will also receive a 5% top up amount to these implied grant amounts to cover other businesses that might be affected by the local restrictions, but which do not neatly fit into these categories. It is therefore at their discretion and dependent upon demand as to how they distribute this.
The government guidance makes specific reference to those in the supply chain being supported by these discretionary grants.
What factors are considered in relation to the discretionary grants?
They are guided to consider
- The level of fixed costs
- The number of employees,
- Whether they are unable to trade online
- Consequent scale of coronavirus losses.
How do I claim?
Local Authorities will be responsible for distributing the grants so watch your LA website.
5.Bounce back Loan (BBL) Top Up
If when you took out your BBL you didn’t take out the maximum of 25% of turnover (or £50k whichever is lower) you will have the option to take out a top-up element.
If for example you had turnover of £100k and were entitled to take a loan of up to £25k but chose to only take £10k in May, you could now borrow an additional £15k.
6.Bounce Back Loan and Coronavirus Business Interruption Loan
Both schemes have now been extended for applications until 31 January 2021.
Any further questions please contact us below
This article is written for the general interest of our clients and is not a substitute for consulting the relevant legislation or taking professional advice. The authors and the firm cannot accept any responsibility for loss arising from any person acting or refraining from acting on the basis of the material included herein.
