On Friday the Chancellor announced updates to the furlough scheme. And also an extension to the self-employed scheme.
Let’s go into the furlough scheme changes first.
Furlough scheme changes
From 1st August the government are going to start reducing the amount of financial support they are paying to businesses with furloughed staff.
The factsheet they have produced is here, and worth a read. It is lacking finer detail, which is on its way, but it gives a good outline of what to expect in the months ahead.
Our main points are summarised here:
- The furlough scheme has been extended to 31st October 2020
- You can bring back furloughed staff part time from 1st July 2020. You’ll only pay for the hours that they work in the business.
- You must put an agreement in writing to access the part time hours furlough scheme.
- Detailed guidance will be issued on 12th June.
- The furlough scheme is closing for new entrants on 30th June 2020.
- Anyone who wants to be on the scheme after that date must have been furloughed for 3 weeks prior to 30th June, which would make 10th June the cut-off date for furloughing your staff if you want to make a claim.
- A claim for these employees must be made on or before 31st July 2020.
- From 1st August, government payments will start to reduce. They will no longer pay employers NI & employers pension, which you will need to cover.
- From 1st September, the government will pay 70% of wages up to cap of £2,187.50 with employers paying 10% up to total pay of £2,500.
- From 1st October, government will pay 60% of wages up to cap of £1,875 with employers paying 20% up to total pay of £2,500.
We held a webinar to discuss these changes which will be on our YouTube channel soon. Please contact us if you wish to watch it before we it’s published.
Self-employed income support scheme
The self-employed income support scheme has been extended to a second and final grant for the 3 x months ending 31st August 2020. This will be paid in August 2020.
It will only cover 70% of average monthly monthly trading profits, the first grant covers 80%.
30% of the self-employed who are eligible for the grant still haven’t claimed it, let us know if you’re struggling with yours.