Latest Update RBKC Coronavirus

Furlough scheme and the Self-Employment scheme – Latest Update

There have been some substantial announcements from Chancellor Rishi Sunak at the Government press conference, last Friday, 29 May, regarding both the Furlough scheme and the Self-Employment scheme as the Government tries to ‘kick-start’ the economy. The main points are as follows:

Coronavirus Job Protection Scheme – CJPS (the Furlough scheme)

Some 8.4 million workers are having 80% of their salaries paid by the Government – up to £2,500 a month

. Previously we knew that the Furlough scheme had been extended to the end of October.  There is now more flesh on the bones:

  • There will be no additional furlough entrants permitted after 10 June 2020;
  • A ‘Flexible Furlough’ scheme will be introduced from 1 July, a month earlier than previously indicated, allowing Employers to bring workers back on a part-time basis, so that an employee can, for example, work 2 days a week and be on furlough for 3 days per week. In this example, the Employer pays 100% of the salary for the 2 days at work, while the Government will pay 80% of wages for the 3 days furloughed in July and August. 
  • The Government contributions to the furlough scheme will be reduced from August as follows:
    • From August, employers will no longer will be able to include Employer National Insurance or Employer Pension Contributions in furlough claims
    • In September, the Government will contribute 70% and the employer must add the extra 10% to get to 80%
    • In October, the Government will contribute 60% and the employer must add the extra 20% to get to 80%

Coronavirus Self-Employment Income Support Scheme

The Self-Employment Income Support Scheme (‘SEISS’) will be extended for 3 months and will open up again in August for a second and final grant.  This will cover July to September 2020. 

2.3 million people have applied for the single taxable grant so far totalling £6.8bn. Those whose work has been affected by coronavirus will still be able to apply for this lump sum until 13 July. 

The second grant will work as before but will cover 70% rather than 80% of the average taxable income for the previous 3 years (provided average taxable income is less than £50,000, and Self-Employed Income exceeds 50% of taxable income).  The maximum payout will be £6,570 rather than £7,500. Applicants would not need to have taken the first grant to be eligible for the second.

As always, PBC Team stand ready to assist clients as required. Please contact info@pbc.co.uk or 020 7460 5050 for a telephone, Skype or Zoom appointment.