- Coronavirus Job Retention Scheme (the “Scheme”)
On 17 December 2020, the Chancellor announced a further update on the Scheme also known as “furlough”.
The Scheme has now been extended until the end of April 2021 and the government has confirmed they will continue to contribute 80% of employee’s wages for the hours not worked until the end of the Scheme. This means the previous expectation that the contribution would reduce from January 2021, will now not occur.
Employers therefore will only be required to pay employees salary, National Insurance Contributions (NIC) and pension contributions for the hours worked and NICS and pension contributions for the hours not worked.
- Government Backed Loans
The Chancellor also confirmed he would be extending the government guaranteed Covid-19 business loan schemes until the end of March.
Businesses will now be given until the end of March 2021 to access the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme and the Coronavirus Large Business Interruption Loan Scheme. These were originally set to close at the end of January 2021.
- The Self-Employment Income Support Scheme (SEISS)
SEISS has also been amended. The government has announced there will be a fourth grant covering the period from February to April 2021. Further guidance on this is expected to be released at the Budget.
The Budget will now take place on 3 March 2021. It has been briefed that this will set out the next phase of the plan to tackle the virus and protect jobs.
The changes mean that businesses will be able to plan with government support in the first few months of the New Year. The government has also indicated more certainty will be provided to business beyond March 2021 through a successor loan scheme. Details of this scheme are expected to be released in due course.
Please note that the guidance is constantly changing and we therefore recommend that you check the position with us before taking any action.
For further information, please contact our Gill Brown or Jacqueline Kendal in our Employment team.
Phillips Solicitors Limited
This article is current at the date of publication set out above and is for reference purposes only. It does not constitute legal advice and should not be relied on as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action.