In the Chancellor’s Summer Statement, some surprise announcements were shared. With more information to follow, we wanted to give you the key information on these new government policies.
We have shared a lot of information about how the government’s Job Retention Scheme works, but today in the Chancellor’s Summer Statement, Rishi Sunak has announced a new policy.
This time, an update to the scheme has revealed that businesses that welcome back their staff from furlough will receive a £1,000 bonus per staff member.
A business can only claim the bonus should they bring back staff until at least January 2021. The aim is to ensure as many jobs are retained a possible.
In order to receive this bonus, an employee must:
– Earn an average of at least £520 per month for November, December and January
– Have been furloughed at any point and claimed for under the Coronavirus Job Retention Scheme
– Be continuously employed until at least 31 January 2021
The bonus can be claimed by employers from February 2021. More information about the Job Retention Bonus Scheme will be released soon.
For the next six months, VAT is to be cut for the leisure & hospitality sector. Since 2011, VAT for most goods and services has been at 20%. Select businesses are to enjoy a cut down to just 5% until January 2021. In the Chancellor’s Summer Statement, Sunak said:
“Our economy relies on consumption, especially social consumption. The pub, cafe, hotels, restaurants and BnBs which bring life to our towns and cities.”
It is these attractions and more including cinemas and takeaway food business that will see their VAT rates slashed to 5%.
Not the title we would have chosen for a government scheme, but this benefits everybody. Could you ever imagine being given the incentive by the UK government to go out for food, or to the pub? From next week, participating restaurants will be able to give their customers 50% off their food bill (up to £10 per person).
The hope behind this is that more people will be persuaded to give eating out a go, in-turn aiding the business received by the hospitality sector. Some people aren’t yet comfortable going to certain public places, such as restaurants, through fear of catching the virus.
The government have stated that they would not have allowed such places to open if it couldn’t be done safely, and so to help people out their front doors and into those of participating restaurants, they will give you up to £10 of your food bill.
A very welcome holiday for stamp duty will take effect immediately. With the threshold increasing to £500,000, the holiday is set to last until 31 March 2021, providing much relief to buyers with the average stamp duty bill falling by £4,500.
The Chancellor has also said on the matter:
“Nearly 9 out of 10 people buying a main home this year will pay no stamp duty at all.”
So long as vendors don’t set out to increase house prices as a result of this, buying a home, specifically a first home, may be much easier for the foreseeable future.
If you are one of our clients and have questions regarding the VAT cut, please feel free to get in touch if we haven’t already.
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