Business Support at a Glance
11 Nov 2020
The Chancellor recently announced some additional support for businesses and self-employed, here we look at these in more detail.
Self-employed Income Support Scheme
The overall level of the self-employed grant will increase to 80% of 3 months trading profits, covering November to January for all parts of the UK. The grant will be paid out in a single instalment and capped at £7,500.
The second grant will still cover a three-month period from the start of February until the end of April 2021, with the government to review the level of the second grant and set this in due course.
Coronavirus Job Retention Scheme
The Coronavirus Job Retention Scheme will remain open until 31 March 2021. From 1 November 2020 you can claim 80% of an employee's usual salary for hours not worked, up to a maximum of £2,500 per month.
If you cannot maintain your workforce because your operations have been affected by coronavirus (COVID-19), you can furlough employees and apply for a grant to cover a portion of their usual monthly wage costs where you record them as being on furlough.
You can claim for employees who were employed on 30 October 2020, as long as you have made a PAYE RTI submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee. This may differ where you have made employees redundant, or they stopped working for you on or after 23 September 2020 and you have subsequently re-employed them. The Government will review the scheme in January 2021.
You do not need to have previously claimed for an employee before the 30 October 2020 to claim for periods from 1 November 2020.
Employers can furlough employees for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked.
Employers can continue to claim for periods ending on or before 31 October 2020 until the deadline on 30 November 2020. You might need to contribute towards the cost of your furloughed employees' wages for these periods. For periods from 1 November 2020, you will only need to pay for the cost of employer NICs and pension costs. Find out more information on employer contributions to the Coronavirus Job Retention Scheme.
If you've already worked out how much you can claim, you can claim for wages online through the Coronavirus Job Retention Scheme. For claim periods starting on or after 1 November 2020, you'll be able to claim from 11 November 2020.
Coronavirus Job Retention Scheme grants are not classed as state aid.
Who can Claim: If you're claiming for a period that ends on or before 31 October 2020, you can only claim if you have previously furloughed your employee before 1 July 2020 and you have submitted a claim for this by 31 July 2020. This may differ if you have an employee returning from statutory parental leave
Employees you can claim for: Find out which employees you can put on furlough and claim for.
Emergency Business Loans
As recently announced, more businesses will be able to access additional support as deadlines for applications for Government-backed loan schemes and the Future Fund have been further extended until January 31, 2021. UK firms will now have until the end of January to apply for emergency business loans, including bounce back loans (BBLS), coronavirus business interruption loans (CBILS) and the CLBILS scheme for larger firms.
This announcement also includes an adjustment of the Bounce Back Loan Scheme rules to allow those businesses who have borrowed less than their maximum (i.e. less than 25% of their turnover) to top-up their existing loan.
Businesses will be able to take up this option from next week; they can make use of this option once to ensure that they are able to benefit from the loan scheme as intended.
Mortgage payment extensions
Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, with the The Financial Conduct Authority (FCA) instructing banks to extend to that period even with the lockdown in England due to be reviewed on December 2.
The FCA also revealed those who have resumed repayments after an initial payment deferral will be eligible to extend that deferral up to the maximum half-year period without this being recorded on their credit file.
The FCA has also proposed to extend payment deferrals and other support to personal loans, credit cards, motor finance, rent-to-own, buy-now-pay-later and pawnbroking customers who are experiencing payment difficulties because of coronavirus.
For more information on COVID-19 and other announcements/updates made by the Chancellor, visit our dedicated Coronavirus pages www.nhllp.com/covid-19
Bounce Back Loan top-ups now available
Participating lenders in the Bounce Back Loan Scheme (BBLS) are able to offer smaller businesses across the UK a 'top-up' to their existing Bounce Back Loan if they originally borrowed less than the maximum amount available to them.
The Bounce Back Loan top-up will be available from several large lenders, with others anticipated to make the top-up available in due course.
The top-ups are only available from a borrower's existing BBLS lender. A borrower can apply for a top-up that is for the lesser of £50k or 25% of the annual turnover the borrower certified in their original successful BBLS application form, minus the value of their original loan.
The scheme was unveiled in May to support smaller businesses during the pandemic, offering loans of up to £50,000, with the value of the loan fully guaranteed by the Government.
It formed part of the Government's emergency loan package that also included the below schemes - find out more about which loan could be suitable for your business:
The Chancellor announced the top-up loan along with extending the new applications deadline for the loan schemes from November to January 31, 2021, following the recent lockdown in England.
Bank of England injects £150bn into UK economy
The Bank of England (BoE) has announced it will put an extra £150bn into the UK economy as England begins a second lockdown.
In its latest report on the UK's economic outlook, the Bank's monetary policy committee (MPC) warned there are signs that consumer spending has softened across a range of high-frequency indicators, while investment intentions have 'remained weak'.
The Bank revealed that the MPC agreed to print an extra £150bn, which will extend its asset purchase scheme to £875bn.
The BoE expects GDP to decline in the final few months of the year, before picking up alongside household spending in Q1 2021, as restrictions loosen. The MPC kept interest rates on hold at 0.1%.