Background
Last week the Government announced further changes to the Job Support Scheme (JSS) in order to provide increased support to businesses experiencing difficulties as a direct result of coronavirus restrictions.
When originally announced, the JSS involved employers paying a third of employees’ wages for hours not worked, and required employees to work 33% of their normal hours. The changes announced by the government reduces the employer contribution to just 5%, and reduces the minimum working hours to 20%.
Support available under the Self-Employment Income Support Scheme (SEISS) Grant Extension has also been increased, with the Government announcing the doubling of the value of the first grant.
Detail
Changes to the Job Support Scheme
There are now two variations to the JSS – JSS Open and JSS Closed. The changes announced by the Government last week will apply to the JSS Open, those businesses that remain open but where employees are working shorter hours due to reduced demand.
The recently announced JSS for businesses legally required to close due to any local or national restrictions, JSS Closed, remains unchanged.
Under the JSS Open employees must work at least 20% of their usual hours, rather than the previously required 33%, and employers will continue to pay the wages of staff for the hours that they work. This means that those employees working just one day a week will become eligible.
For hours not worked, the Government will now pay a contribution of 61.67% of the employee’s usual pay for hours not worked, up to a maximum of £1,541.75 per month.
Employers will also be required to pay at least 5% of the employees usual pay for hours not worked, a reduction from the original requirement to contribute one-third.
As a result the scheme will ensure employees continue to receive at least 73% of their normal wages, where they earn £3,125 a month or less.
An employer can claim the JSS Open and JSS Closed grant at the same time for different employees. However, an employer cannot claim for a single employee under both schemes at the same time.
Businesses will be able to apply to use the updated JSS even if they have not previously made a claim under the Coronavirus Job Retention Scheme (CJRS).
The start date for the scheme remains 1 November 2020 and the scheme will be available for six months until 30 April 2021, with a review in January 2021. Businesses will be able to make claims in arrears via a HM Revenue & Customs (HMRC) claims service from 8 December 2020.
Increased support for the Self-Employed
The Chancellor also announced increased support would be available under the SEISS Grant Extension, with the doubling of the first grant for the self-employed.
The initial taxable grant available to those who are currently eligible for SEISS covering the three months’ worth of profits for the period from November 2020 to the end of January 2021 will be based on 40% of three months’ average trading profits, up to a total of £3,750, rather than the previous 20%.
The SEISS Grant Extension will be available to self-employed individuals who temporarily cannot trade as well as those continuing to trade and facing reduced demand due to COVID-19.
Further details about claiming and making an application under the SEISS Grant Extension are expected to be provided by HMRC in mid-November.
An additional second grant, which may be adjusted to respond to changing circumstances, will be available for self-employed individuals to cover the period from February 2021 to the end of April 2021. Further announcements on the second grant are not expected until at least early next year.
Our Current working arrangement – We remain ‘Open for business’
Our staff have returned to office based working on a rota basis, each attending two days a week, whilst continuing to work from home at other times. They can still be contacted in the usual way either via email or by calling the office number where reception will divert your call to the appropriate staff member.
If you would like more information or if you require our assistance in ensuring your eligibility for the Job Support Scheme or the Self-Employment Income Support Scheme, please speak to your usual contact at the firm.
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