Since publication of this blogpost, updates have been made to the Coronavirus Job Support Scheme.

With the continuation of the Coronavirus pandemic, the UK government has pledged to support the economy through a number of schemes. This article will focus on the details of the Job Support Scheme and the Self Employed Income Support Scheme (SEISS) laid out in the recent Winter Economy Plan from the Treasury. 

Job Support Scheme

The Job Support Scheme seeks to bridge the gap for companies that are experiencing a lower level of income as a result of Covid and the associated restrictions. It aims to protect jobs that would otherwise be viable, and ensure that employees’ jobs remain secure throughout the winter months by contributing to their wages.

To qualify, employees need to have been on the company’s payroll on or before the 23rd September 2020 and currently be working at least a third of their usual hours. The government and the employer will then split the cost of topping up the wages (with the government contribution capped at £697.92 a month), guaranteeing at least 77% of the employee’s usual wage even when the business is unable to accommodate their usual working pattern. This additional payment is calculated using the employee’s usual hourly wage; the employer and the government will each put forward a third of this rate on all hours that are not worked.

Employers are responsible for applying to utilise this scheme, and are welcome to do so regardless of whether or not they have benefited from the Coronavirus Job Retention Scheme earlier in the year. They will also be responsible for paying the employee and claiming the grant after the fact, being reimbursed for the portion of wages that the government is taking responsibility for. Applications are open from the 1st November 2020 and will close at the end of April 2021.

Job Support Scheme figures

Since publication of this blogpost, updates have been made to the Coronavirus Job Support Scheme.

Self Employed Income Support Scheme

Support for self employed people is also available to cover the same period, in the form of the SEISS. This will come in two separate grants; the first for November to January and the second for February to April, and is an extension of the existing scheme. 

As with the Job Support Scheme, the SEISS aims to provide support where the impact of Covid has led to a reduction in demand. It is essential that the individual/partnership has continued to trade and has no plans to stop trading. This scheme is accessible via the government’s own website, click here to see if you can claim a grant through the Self-Employment Income Support Scheme.

HMRC have endeavoured to provide roughly the same amount of support to the self employed as they have to employers, offering the first taxable grant to cover 20% of the average monthly profits (capped at £1875) for the November to January claim period. The details of the following grant are yet to be disclosed. 

With both of these schemes there is a clear focus on only supporting businesses and individuals that can prove their viability but need a little more time to get properly back on track. In helping businesses that have remained operative throughout the pandemic, HMRC hope to bolster the UK’s economic recovery.

Whether you’re self employed or run a limited company, Neil Smith Accountancy can help you navigate the financial side of things. Contact our expert team for small business accounting and bookkeeping, self assessment taxes, professional business advice, or for start up advice if you’re thinking of setting up a new business during these tricky times.