Many have been asking what happens next for those reliant on the Job Retention Scheme but with the Chancellor’s announcement of the new Job Support Scheme, along with other business support initiatives ready to begin in November, a respite may be coming.

How does the Job Support Scheme work?

The Chancellor’s new Job Support Scheme will be available to employees who are working at least a third of their normal working hours. They must be being paid as normal by their employer.

The government and employers will jointly increase their wages to cover two-thirds of their lost pay and the employee will keep their job

The scheme will run for a period of six months, starting this November.

Who is eligible for the Job Support Scheme?

All small and medium-sized businesses will be eligible for the scheme. Larger businesses must prove that their turnover has fallen during the pandemic.

It can be used by employers, regardless of whether or not they made use of the furlough scheme that the Job Support Scheme has been designed to replace.

Upcoming changes

Self-employed

Good news for self-employed individuals, as the current SEISS grant is to be extended on similar terms to the Job Support Scheme.

Pay as you grow

The government are to introduce a “pay as you grow” scheme to extend Bounce Back Loan repayments for businesses from 6 to 10 years, reducing what they pay.

Businesses can also move to interest-only payments or suspend repayments for six months if they are “in real trouble”. Credit ratings will be unaffected.

Business Interruption Loans

The government guarantee on Coronavirus Business Interruption Loans will be extended to 10 years and a new successor loan guarantee programme will be announced in January.

VAT

The temporary reduction of VAT from 20% to 5% for some sectors will remain in place until 31 March 2021.

VAT Deferral

Additional support has also been announced which allows people to delay their income tax bill. Millions of self-employed people or those who have more than one source of income have to complete a self-assessment tax form every year.

The chancellor has announced a payment plan for those with a tax debt of up to £30,000 that can be paid over 12 months to from January 2021 to January 2022.

Businesses who deferred their VAT will no longer have to pay a lump sum at the end of March next year. They will have the option of splitting it into smaller, interest-free payments over the course of 11 months. This will in-turn benefit up to half a million businesses.

More to come…

This is great news for small businesses looking for continued support. We will be announcing further information in the coming days with more detail about the scheme and how it works.

As always, we are here to support you too. If you need any advice on the Job Support Scheme or any other funding you are looking to acquire speak to our team.

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