As part of the latest Budget there were some new announcements relating to continuing financial support for businesses affected by COVID19. The main points to note are as follows:
The CJRS (furlough scheme) is being extended to the end of September, providing 80% of pay of hours not worked, up to the current cap of £2,500 per month. Up to 30 June HMRC will fund 80% of pay, with employers being responsible for employers’ NIC and pension contributions. HMRC support will drop to 70% in July and 60% in August and September.
The SEISS will also be extended to September but with some important changes:
Eligibility for both grants will include profits declared on the 2019/20 tax return and therefore those who were not previously eligible because they did not start self-employment until 2019/20, or whose self-employed earnings were not high enough in 2018/19 (perhaps because they had only just commenced self-employment) could be eligible for the fourth and fifth grants.
Some people could also cease to be eligible although earlier years profits will still be taken into account in calculating average profits where applicable.
From April 2021 a new Government backed loan scheme will replace the existing Bounceback Loan scheme. It will provide loans from £25,000 to £10 million with an 80% guarantee from the Government and will be available to any business which has been adversely affected by COVID including those who have already taken a Bounceback loan.
The Government will provide restart grants distributed through local Councils of up to:
Relief from business rates is being extended to 30 June for eligible retail, hospitality and leisure properties. For the remainder of the financial year to 31 March 2022 66% relief will be available.
VAT which was deferred from the period March to June 2020 and is due for payment by 31 March may be repaid in interest-free instalments over the period to 31 March 2022. Application must be made to opt into this scheme on the HMRC website.
The temporary reduced rate of 5% for hospitality, holiday accommodation and attractions is extended until 30 September 2021, when it will be replaced by a new 12.5% rate until 31 March 2022.
As usual, if you have any questions about how these changes may affect you please get in touch, preferably by email in the first instance.