COVID-19 Update: Changes and extensions to government coronavirus support schemes

11 September 2020
COVID-19 Update government support schemes

Recently, there have been a number of changes to the coronavirus government’s coronavirus support schemes. We will cover all of the known changes below including closing deadlines and extensions to provide you with helpful and essential information regarding all of the latest updates.

 

Coronavirus Business Interruption Loan Scheme (CBILS) deadline confirmation

The British Business Bank has confirmed the Coronavirus Business Interruption Loan Scheme (CBILS) will be closed to new applications from midnight on the 30th of September 2020. Lenders will have an extended period of 2 months to process, assess, and pay-out any outstanding applications. Currently, £13.4 billion has been paid out by the scheme with a massive 59,520 loans being approved from a total of 121,669 applications, meaning 49% of all applications have been approved.

 

Commercial Tenant Eviction Ban extended

Commercial tenants who cannot afford to pay their rent or board due to the Coronavirus pandemic will be protected from eviction for an extended amount of time. Initially, the measure was only in place until the 30th of June 2020, but the government has decided to extend this until the end of September 2020.

 

New rules for overclaimed Coronavirus grants

covid support schemes

Taxpayers who have previously received Coronavirus Job Retention Scheme (CJRS) or Self-employment Income Support Scheme (SEISS) grants have been urged to doublecheck their entitlement as the 90-day period to inform HMRC if they overclaimed on any of these grants is now part of the law.

The Finance Act 2020 includes legislation that the CJRS, SEISS, Coronavirus Statutory Sick Pay Rebate Scheme, and Coronavirus business support grants are all taxable. As well as including changes which mean that HMRC has the powers to recover grant payments to which the taxpayer wrongly received and penalty provisions.

HMRC has recently published guidance on how taxpayers can repay overclaimed grants. The guidance has confirmed that the onus is on the taxpayer to notify HMRC if they have overclaimed any of the previously listed grants, and this must be done by the 20th of October 2020, or 90 days after the grant has been received, whichever is later.

 

Changes to the Coronavirus Job Retention Scheme

Coronavirus Job Retention Scheme red label in mini shopping cart

Over the past few months, there have been several changes to the Coronavirus Job Retention Scheme, and the government has announced a number of upcoming changes up until the scheme ends at the end of October. The changes are as follows:

July – Changes from the 1st of July stated that employers could bring furloughed employees back to work on a part-time basis. Employers will have to pay the wages for the time the employee is in work and can apply under the scheme to cover any of the normal hours they would usually receive but are furloughed for.

August – From the 1st of August, the changes stated that the government would pay 80% of wages up to a cap of £2,500. Employers will be obliged to pay employer National Insurance and pension contributions.

September – From the 1st of September, the changes state that the government will fund 70% of a worker wage up to the cap of £2,187.50. Employers will again be obliged to pay the employer National Insurance and pension contributions, alongside 10% of wages to raise the amount to 80% up to a cap of £2,500.

October – From the 1st of October, the changes state that the government will fund 60% of a worker wage up to the cap of £1,875. Employers will again be obliged to pay the employer National Insurance and pension contributions, alongside 20% of wages to raise the amount to 80% up to a cap of £2,500.

£1,000 bonus for bringing back employees from furlough – Employers will be given a £1,000 job retention bonus for every employee who they bring back from furlough, but the employee has to remain employed until the end of January 2021. Workers must have been employed continuously throughout the coronavirus pandemic and earn an average of more than £520 monthly in November, December, and January. The bonus payments will be paid from February 2021 and further details about the scheme will be provided later this month.

For employers who have already made furloughed workers redundant, the guidance appears to suggest that you can let employees return and be re-furloughed until the 31st of October, and then you will be eligible to claim for the Job Retention Bonus, assuming that there is suitable work available for them until January 2021. The employee must have been furloughed for at least 3 consecutive weeks between the 1st of March and the 30th of June 2020. However, it is recommended that you seek guidance from a lawyer who specialises in employment before making any decisions.

 

New law to ensure furloughed employees receive full statutory redundancy payments

The government has introduced legislation that will ensure that employees who have benefitted from the Coronavirus Job Retention Scheme will not lose out on certain entitlements. The legislation ensures that a number of statutory rights including redundancy pay, notice pay, and compensation for unfair dismissal claims are based on an employee’s normal pay, rather than the furlough rate of pay which is 80% of their normal wage.

The new and updated legislation will ensure that all entitlements listed above will be based on an employee’s normal pay rather than on any reduced rate, whether it is related to the furlough scheme or not. ACAS can help you work out your usual average weekly pay for someone who has been furloughed.

 

SEISS extended

business closed for coronavirus

The Self-employment Income Support Scheme (SEISS) has been extended to include a second and final grant which is available for businesses that have been affected by the current pandemic on or after the 14th of July 2020.

Applications for the second and final SEISS grant opened on the 17th of August 2020 and you have until the 19th October 2020 to make your claim for the second grant. The eligibility criteria are the for the second grant as they were for the first. You can also claim for the second grant if you didn’t make a claim for the first grant.

The value of the second grant is slightly reduced. Those who are eligible for the second grant will be able to receive a grant that is worth 70% of their average monthly trading profits of up to £6,750 in total for the second three-month period.

The first grant is for people whose business was impacted by the coronavirus pandemic before July 13th and the second, for those impacted by the pandemic after the 14th of July. If your business was impacted before and after these dates, you are eligible for both grants.

HMRC will contact taxpayers who are potentially eligible to advise them that they can claim for a second and final SEISS grant.

 


Get in touch with Maple Accountancy

Are you unsure whether your company is eligible for any of the coronavirus support schemes? Maybe you have already started your application but are seeking further advice on the matter? Either way, our expert team is always ready to help. Get in touch with us today at success@maple.uk.com or 01332 207336 to find out how we can help your business with their financing and accounting needs.

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