Coronavirus – Recent Updates

Coronavirus Job Retention Scheme

General

  1. On 29 May 2020 the chancellor announced further changes to the Job Retention Scheme as follows:
  • a (i) As from 1 July 2020 furloughed employees will be able to come back to work part time and the employer will still be able to claim under the job retention scheme. The employer will be required to fund hours actually worked as per the employees contract or agreed varied contract and the government will contribute the remainder of 80% of an employee’s ‘regular wage’ for regular hours not worked. The total payment by the employer and the government must be at least 80% of the employees ‘regular wage’ and the government will contribute up to a maximum of £2,500 per month. Employers will need to report hours worked and the usual hours that each relevant employee would be expected to work in a claim period. The employer will fund any Employers NIC and pension contributions in relation to hours worked. Further guidance will be given regarding the above on 12 June 2020.
  • a (ii) As from 1st July 2020 claim periods will no longer be able to overlap calendar months.
  • a (iii) As from 1st July 2020 the number of employees an employer can claim for in any claim period cannot exceed the maximum number that they have claimed for under any previous claim under the JRS up to 30 June 2020.
  • (b) As from 1 August 2020 employers will have the same claim under the JRS as 1 a) above except that the employer will be responsible for all the employers national insurance and pension costs.
  • (c) As from 1 September 2020 the government will contribute 70% of an employee’s ‘regular wage’ for regular hours not worked up to a cap of £2,187.50 per month. The employer will fund the extra 10% for the hours not worked plus the hours worked. The total payment by the employer and the government will be at least 80% of the employees ‘regular wage’ up to a maximum of £2,500 per month. The employer will fund all Employers NIC and pension contributions.
  • (d) As from 1 October 2020 the government will contribute 60% of an employee’s ‘regular wage’ for regular hours not worked up to a cap of £1,875 per month. The employer will fund the extra 20% for the hours not worked plus the hours worked. The total payment by the employer and the government will be at least 80% of the employees ‘regular wage’ up to a maximum of £2,500 per month. The employer will fund all Employers NIC and pension contributions.
  • (e) The scheme ends on 31 October 2020.

2. New entrants to the scheme must have been furloughed by 10 June 2020 to claim under the Job Retention Scheme and still be furloughed as at 30 June 2020 (if their first furlough was on 10 June 2020). If an employee was previously furloughed for at least three weeks before 10 June 2020 they can be furloughed again after 1 July 2020.

3. Employers will have up to 31 July 2020 to make any claims in respect of the period to 30 June 2020.

4. Employers will be able to make their first claim under the new scheme as from 1 July 2020.

5. Where employees are brought back part time or the amount of furlough payment has changed, the terms of their employment will need to be reviewed and agreement to the new terms will need to be obtained from all relevant employees in writing. We recommend legal advice should be sought in relation to these changes.

6. When calculating an employee’s ‘normal wages’ only include contractual payments that the employer is legally required to pay and the employee can enforce, these can include variable amounts e.g. commission payments based on sales via an agreed formula, as long as they are contractual.

Self Employed Income Support Scheme

  1. Taxpayers who wish to claim the 1st grant covering the period 1 March 2020 to 31 May 2020 must do so by 13 July 2020. If you have not made a claim yet then please ensure this is done as soon as possible or by 13 July 2020 at the latest. The link is https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme.
  2. If you miss the deadline for the first grant payment this will not affect your claim for the second grant payment.
  3. The chancellor announced on 29 May 2020 that a second and final grant covering the period 1June 2020 to 31 August 2020 will be made sometime in August 2020. HM Revenue and Customs will contact eligible taxpayers in relation to the second grant and further details will be released on 12 June 2020.
  4. The second grant will be less than the first grant and will be based on 70% of the average monthly profits (as calculated for the first grant) up to a cap of £2,190 per month. The maximum claim is therefore £2,190 x 3 = £6,570. The first grant was based on 80% of the average monthly profits up to a cap of £2,500 up to a maximum grant of £7,500.
  5. If the taxpayer disagrees with HM Revenue and Customs that they are not eligible for the scheme after using the online eligibility checker, then they can request a review of this decision online via the online gForm. Agents can do this on behalf of the taxpayer. HM Revenue and Customs will respond as quickly as possible to the review request.
  6. The deadline for claiming the second grant has not yet been announced but is expected to be announced on 12 June 2020.
  7. For both the first and the second grant the eligibility criteria are the same and individuals will need to confirm that they have been adversely affected by coronavirus when apply for the second grant.

Taxpayer claiming the grant must ensure that they are below the state aid limits.

The receipt of the grant should be reported immediately to the appropriate government department if claiming Universal Credits and/or Tax Credits, as it may affect the taxpayers claim, but understand that it will not affect claims for earlier periods.

Please be aware of scammers during this time.

Business Grants under the Discretionary Grant Fund administered by a businesses Local Council

  1. Attached is a document detailing potential eligibility for the above fund where the business is not eligible for the Small Business Grant Fund or the Retail, Hospitality and Leisure Grant Fund.
  2. Businesses can apply online via their local council’s website.
  3. Applications close at 9.00 am 15 June 2020.