The Chancellor last week announced increased support for struggling businesses hit by Covid 19 which include more financial support for the Job Support Scheme and the Self Employed Income Support Scheme. Plus grants have been made available for certain hospitality businesses. Here’s all you need to know about the changes.
Job Support Scheme
For Businesses in Tier Three which have been forced to close the government will pay 67% of wages. Employers will only need to pay National Insurance and Pension Contribution.
For all other affected businesses
Employees must work a minimum of 20% of their normal hours which is paid at their normal wage rate.
For non-working hours the employer will need to pay 4% and the Government will pay a further 49% which means employees will receive a minimum of 73% of their normal wages.
John’s contracted working hours are 40 hours per week at £10 per hour. He works 20 of those hours and has 20 non-working hours.
His 20 working hours are paid at his normal rate by the employer - 20 hours x £10 = £200
Of his remaining non-working hours (20 hours @£10 = £200) the Government will pay 49% = £98 and the employer will pay 4% = £8
Please note that for both schemes employers have to pay National Insurance and Pension Contributions.
Any small or medium sized business can make use of the scheme. Larger firms (typically with 250 or more employees) must prove they have been adversely affected before they can claim.
You can include any employees who were on the payroll on 23 September 2020 meaning it is not restricted to employees who were part of the furlough scheme.
To qualify employees must work at least 20% of their normal hours.
Self Employed Income Support Scheme
The grant based on businesses average monthly profits for November, December and January has been doubled from 20% to 40% up to maximum of £3,750.
Councils in England will be funded to pay monthly grants of up to £2,100 to 150,000 hotels, restaurants and B&B’s.
If you need help or advice with any of these changes please contact us. We’re here to help your business navigate through these difficult times and ensure you receive all the support provided.