Among the many measures and issues addressed by the Chancellor in the budget were a number of schemes to help employers, employees and self-employeds where Coronavirus has impacted adversely upon their ability to run their businesses or carry on their employment. The main measures are as follows:
Coronavirus Job Retention Scheme (CJRS)
More commonly referred to as the Furlough Scheme, the CJRS is being extended for a further five months from May until the end of September 2021. Employees will continue to receive 80% of their current salary (up to a maximum of £2,500 per month) for hours not worked. There will be no employer contributions beyond National Insurance contributions (NICs) and pensions required in April, May and June. From July, the government will introduce an employer contribution towards the cost of unworked hours of 10% in July, 20% in August and 20% in September, as the economy reopens. For more information please see here
Self-Employment Income Support Scheme (SEISS) fourth grant
To support the self-employed across the UK through the next stage of the pandemic, the government are making available a fourth SEISS grant worth 80% of three months’ average trading profits, paid out in a single instalment and capped at £7,500 in total. The grant will cover the period February to April, and can be claimed from late April. Self-employed individuals must have filed a 2019- 20 Self-Assessment tax return to be eligible for the fourth grant. This means that over 600,000 individuals may be newly eligible for SEISS, including many new to self-employment in 2019- 20. All other eligibility criteria will remain the same as the third grant.
A fifth and final grant is planned for the period May to September, the value of which will be determined by a turnover test to ensure that support is targeted to those who need it most. More details of the SEISS can be found here
Recovery Loan Scheme
From 6 April 2021 the Recovery Loan Scheme will provide lenders with a guarantee of 80% on eligible loans between £25,000 and £10 million to give them confidence in continuing to provide finance to UK businesses. The scheme will be open to all businesses, including those who have already received support under the existing Covid-19 guaranteed loan schemes. For more information, please see here
VAT reduction for the UK’s tourism and hospitality sector
The government will extend the temporary reduced rate of 5% VAT for goods and services supplied by the tourism and hospitality sector until 30 September 2021. To help businesses manage the transition back to the standard 20% rate, a 12.5% rate will apply for the subsequent six months until 31 March 2022. For more information, please see here
Business rates reliefs
The government will continue to provide eligible retail, hospitality and leisure properties in England with 100% business rates relief from 1 April 2021 to 30 June 2021. This will be followed by 66% business rates relief for the period from 1 July 2021 to 31 March 2022, capped at £2 million per business for properties that were required to be closed on 5 January 2021, or £105,000 per business for other eligible properties.
Closed Business Lockdown Payment
Certain businesses that have been required to close due to the national lockdown that began on 5 January 2021 may be entitled to a one-off cash grant of up to £9,000 from their local council. For details please see here
To give businesses the cash certainty they need to plan ahead and safely relaunch trading over the coming months, the government will provide a one-off cash ‘Restart Grant’ in England of up to £6,000 per premises for non-essential retail businesses and up to £18,000 per premises for hospitality, accommodation, leisure, personal care and gym businesses.