22 October 2020
The Chancellor has announced significant changes to the Winter Support Package, including the Job Support Scheme, Self Employed Income Support Scheme and business grants.
The details are scant at present, but to date we understand the key points are:
Job Support Scheme
Open businesses, experiencing significant difficulty, will benefit from a change to the Job Support Scheme, due to come into effect from 1 November.
Under the original scheme, employers paid one third of their employee’s wages for hours not worked, and it required workers to be working for a minimum of 33% of their normal hours.
Today’s changes mean that employers are required to pay 5% of their employees’ wages for hours not worked, and reduces the minimum number of hours to 20%.
Employers will continue to receive the Job Retention Bonus.
There is no change to the extended Job Support Scheme, or Job Support Scheme Closed as it is now known, which applies to businesses legally required to close under Covid-19 restrictions.
Self Employed Grants
Under the original scheme, the third SEISS taxable grant, paid to those who met the eligibility criteria, was calculated on 20% of three month’s average trading profit, capped and paid in a single instalment to cover the period from Nov 2020 to end January 2021. The changes announced today, increase the figure to 40% of three months average trading profit, capped at £3,750.
The fourth SEISS grant, to cover the period from February to the end of April 2021 will remain under review and details published in due course.
Business Grants
Cash grants of up to £2,100 per month are to be made available, primarily for businesses in the hospitality, accommodation and leisure sectors, adversely impacted by the restrictions in High Alert level areas. They are provided in addition to higher levels of business support for Local Authorities moving into tier three, benefiting those who are not legally required to close but are adversely affected by local restrictions.
Local Authorities (LAs) will receive funding which they are able to allocate according to their own eligibility criteria based on the following formula.
- For properties with a rateable value of £15,000 or under, grants of £934 per month.
- For properties with a rateable value of between £15,000-£51,000, grants of £1,400 per month.
- For properties with a rateable value of £51,000, grants of £2,100 per month.
The LAs will also be given an additional 5% top up to these implied grant amounts to cover businesses affected by local restrictions but which do not fit into the rateable value categories.
Businesses in Very High Alert level areas will qualify for greater support, whether open or closed of up to £3,000 per month.
Wayne Thomas, Partner at Bates Weston comments:
“There was a mismatch between the impact restrictions would have on businesses in the hospitality sector in particular and the support available in the high alert level areas. The changes to the support packages available will provide welcome additional support to businesses in the High Alert areas and help them to protect jobs.”
We will provide further details as they are available.
Useful links:
Self -Employment Income Support Scheme Grant Extension