Coronavirus Business Support update - by LWA
WHAT CHANGES ARE BEING MADE TO THE CORONAVIRUS JOB RETENTION SCHEME?
From 1st July (a month earlier than originally stated in May's announcement) employers will be able to start bringing furloughed staff back to work on a part time basis, however the scheme will remain in place for furloughed staff until it is withdrawn at the end of October. Below are the details around these changes for employers:
• You will have the flexibility to decide hours and shift patterns for your returning employees.
• You will have the responsibility for paying your employees.
• For any staff remaining on furlough leave:
o In June and July, the Government will continue to pay 80% of wages / salaries via the Coronavirus Job Retention Scheme, up to £2,500 per month per employee, plus National Insurance (ER NICS) and pension contributions. Employers will not need to pay anything.
o From 1st August, The Government will pay 80% of wages / salaries up to £2,500, however the employer will need to pay ER NICS and pension contributions.
o From 1st September, for any employees on furlough leave, the Government will pay 70% of wages / salaries up to a maximum of £2,187.50 with employers paying 10% up to a combined £2,500, as well as paying the ER NICS and pension contributions.
o From 1st October (the last month that the CJRS will be active), the Government will pay 60% of furloughed employees' wages / salaries to a maximum of £1,875, with the employer paying the remaining 20% to the £2,500 cap, as well as ER NICS and pension contributions. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.
o Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.
• To enable the introduction of part-time furloughing, and support those already furloughed back to work, claims from July onwards will be restricted to employers currently using the scheme and previously furloughed employees.
• The scheme will close to new entrants on 30 June, with the last three-week furloughs before that point commencing on 10 June.
• When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of a week, for grants to be calculated accurately across working patterns.
So far, the CJRS has helped 1 million employers across the UK furlough 8.4 million jobs.
For all of LWA's previous updates on the Coronavirus Job Retention Scheme, detailing:
• Who you can furlough
• Furlough claim calculator
• Furlough letter templates
• Who can make the claim on your behalf
• The documents you need to be able to make a claim yourself
Please visit the dedicated Coronavirus Guidance section on our website, or you can contact one of our friendly team on 0161 905 1801.
Finally on the CJRS, we'd like to gently remind our Payroll clients to please let us know as early as possible ahead of the employee return-to-work date when the period of furlough leave will be ending. You can call 0161 905 1801 or you can email Sara@lwaltd.com or Angela@lwaltd.com to let us know. Thank you.
SELF-EMPLOYMENT INCOME SUPPORT SCHEME (SEISS) EXTENDED
Another major announcement made by the Chancellor on Friday was a much-welcomed extension to Self-Employment Income Support Scheme (SEISS).
• If you are eligible to claim from the scheme, you can now make a second and final claim for a grant in August, covering June, July and August as a single payment capped at £6,570.
• The grant will be worth 70% of your average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
• Individuals can continue to apply for the first SEISS grant until 13 July. Under the first grant, eligible individuals can claim a taxable grant worth 80% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total.
• An individual does not need to have claimed the first grant to receive the second grant: i.e. they may only have been adversely affected by COVID-19 in this later phase.
• Further guidance on the second grant will be published on Friday 12th June, and we will send out another update once this guidance has been published.
Whether you still need to claim from the first grant or believe you might need to claim from the second grant, you can check your eligibility below.
Self-employed clients wanting to claim from the Covid-19 SEISS grant should NOT set up a new Government gateway ID in advance, as previously advised, but rather do so as step 1 of the application process. This means that you won’t have to wait for the postal authorisation code from HMRC, whilst also ensuring the correct details are recorded for the claim.
A reminder that unfortunately, LWA or any agent won't be able to make the claim on your behalf in accordance with the Government guidelines. You can find out more on this scheme on the dedicated Coronavirus section of our website at www.lwaltd.com/blogs/coronavirus-guidance
LWA ARE HERE TO HELP
We will continue to keep you updated on any additional government guidance and notes issued that we are made aware of. If you have any specific concerns, please feel free to contact a member of our team on 0161 905 1801 in Manchester, or 01925 830 830 in Warrington.