The UK government has expanded a range of support schemes to help businesses survive England’s second lockdown. Here’s what’s available for you and your company.
England has entered another lockdown.
Businesses in the hospitality, leisure, and retail industries have been forced to shut up shop until at least 2 December.
Other companies have closed offices, mothballing projects that can’t be moved forward virtually.
While some businesses are better equipped than others to withstand these intense restrictions, the damage to the economy will be felt by all.
Government Announces New Support
To tide businesses over until the economy opens, the government has expanded several of its key Coronavirus support schemes.
These measures include an extension to the Furlough scheme, new grants for companies which are required to close their premises, and longer deadlines for government-backed loans.
Below is a detailed run-down of all the new support that’s available for your business.
Coronavirus Support: The Complete Guide
Furlough Scheme Extended
The government has extended the Furlough Scheme until the end of March, helping businesses to retain staff through the winter.
The government has also increased the amount of support available through the Furlough scheme. It will now cover 80% of salaries for staff put on temporary leave, up to a monthly cap of £2,500.
In October, as the scheme wound down, the state was contributing 60% of salaries, with employers required to cover 20%.
Now, the subsidy is back to its original level. Businesses will only need to pay for National Insurance and pension contributions, which account for just 5% of staff costs, on average.
Anyone who was made redundant after 23 September may also be rehired under the scheme.
The government has also scrapped the Job Retention Bonus, but says it will revisit “a retention incentive at the appropriate time”.
Grants for Businesses with Closed Premises
Businesses with premises which are forced to close in England will receive Local Restrictions Support Grants worth up to £3000 per month.
The breakdown of support is as follows:
- Properties with a rateable value of £15,000 or under will receive £,1334 for each month they are required to close
- Those with a rateable value between £15,000 and £51,000 will receive £2000 per month
- Finally, those with a rateable value of £51,000 and over will receive £3000 per month
The government has also allocated £1.1 billion to provide one-off payments to companies that don’t pay business rates.
The money will be distributed at £20 per head.
Deadlines for Major Loan Schemes Delayed
The Exchequer has pushed back the application deadline for all four government-backed Coronavirus loan programmes to the end of January.
These are:
- The Future Fund
- The Bounce Back Loan Scheme (BBLS)
- The Coronavirus Business Interruption Loan Scheme (CBILS)
- The Coronavirus Large Business Interruption Loan Scheme (CLBILS)
Companies now have until 30 January to apply, two months later than the original deadline of 30 November.
SMEs which have already taken out a BBLS loan will also be able to draw down additional funds. This is providing they haven’t already maxed out the scheme’s limit: 25% of revenues up to £50,000.
Companies will only be able to top up once.
Government Boosts Self-Employment Support
The government has greatly increased support for the self-employed.
Under new measures, self-employed people will receive an SEISS grant worth 80% of their estimated trading profits for November, December, and January, up to £7,500.
The move brings support for the self-employed roughly in line with what full and part-time employees will receive through the extended Furlough scheme.
The government will provide a second SEISS grant covering 1 February to 30 April in the new year.
It’s unclear what level of support this grant will cover at this time.
Job Support Scheme Postponed
The extension of the Furlough scheme means that the launch of the Job Support Scheme – billed as a partial replacement for the CJRS – will be delayed.
On 6 October Chancellor Rishi Sunak had announced he was expanding the Job Support Scheme, ratcheting up state contributions while lowering the proportion of regular hours an eligible employee must work to 20%.
Whether these improvements will survive the months-long delay remains to be seen.
A fluid situation
We’ve seen numerous times how, when faced with alarming economic data, or public pressure, the government will increase the amount of aid it’s offering to businesses.
On 31 October we were told the Furlough scheme would last until December. Just four days later, Chancellor Rishi Sunak told MPs the CJRS would now run until March.
So, depending on what happens during lockdown, it’s possible that the government will announce more aid in the next couple of weeks.
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