Winter 2020 – Job Support Scheme, SEISS, Tax Deferral and Bounce Back Loans (pay as you grow) Reply

NEW JOB SUPPORT SCHEME ANNOUNCED

 

Today Chancellor Rishi Sunak announced a new job scheme starting 1 November 2020 to replace the current Job retention (“furlough”) scheme which ends 31 October 2020.

 

All small and medium-sized businesses are eligible, larger businesses must show their turnover has fallen during the pandemic. Employers can use the new scheme even if they have not previously used the furlough scheme.

 

The new Government scheme will last for six months to 30 April 2021 and to be eligible employees will need to be working a minimum of 33% of their hours. For the remaining hours not worked the Government and employer will pay one third. of wages each. This means:

Employers will continue to pay the wages of staff for the hours they work – but for the hours not worked, the government and the employer will each pay one third of their equivalent salary.

 

Employees who can only go back to work on shorter time will still be paid two thirds of the hours for those hours they can’t work.

 

The level of grant will be calculated based on employee’s usual salary, capped at £697.92 per month.

 

By way of an example an employee working 33% of their hours will receive at least 77% of their pay, 22% paid by the Government and 55% paid by their employer (the “worked” 33% plus 22%).

 

SELF-EMPLOYED INCOME SUPPORT SCHEME

 

The existing self-employed grant (SEISS) will also be extended on the same basis as the job support scheme.

 

An initial taxable grant will be provided to those who are currently eligible for SEISS and are continuing to actively trade but face reduced demand due to coronavirus. The initial lump sum will cover three months’ worth of profits for the period from November to the end of January next year. This is worth 20% of average monthly profits, up to a total of £1,875.

An additional second grant, which may be adjusted to respond to changing circumstances, will be available for self-employed individuals to cover the period from February 2021 to the end of April.

 

 

VAT CUT FOR HOSPITALITY SECTOR CONTINUES

 

The reduction in VAT to 5% for the hospitality and tourism sector will be extended until 31 March 2021.

 

DEFERRAL OF VAT BILLS

 

Up to half a million businesses who deferred their VAT bills will be given more breathing space through the New Payment Scheme, which gives them the option to pay back in smaller instalments. Rather than paying a lump sum in full at the end March next year, they will be able to make 11 smaller interest-free payments during the 2021-22 financial year.

 

SELF-ASSESSMENT TAXPAYERS – TIME TO PAY EXTENSION

 

Approximately 11 million self-assessment taxpayers will be able to benefit from a separate additional 12-month extension from HMRC on the “Time to Pay” self-service facility, meaning payments deferred from July 2020, and those due in January 2021, will now not need to be paid until January 2022.

 

BOUNCE BACK LOANS – FLEXIBILITY GIVEN TO PAY BACK AMOUNTS BORROWED

 

More than a million businesses who took out a Bounce Back Loan will get more repayment time through a new Pay as You Grow flexible repayment system.

This includes extending the length of the loan from six years to ten, which will cut monthly repayments by nearly half. Interest-only periods of up to six months and payment holidays will also be available to businesses.

 

The Government also intends to give Coronavirus Business Interruption Loan Scheme lenders the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan.

 

The chancellor also announced an extension in applications for the government’s coronavirus loan schemes until the end of November.

 

Further guidance will be issued in due course.

See: https://www.gov.uk/government/news/chancellor-outlines-winter-economy-plan

steve@bicknells.net

 

Have I paid enough National Insurance to get the State Pension? Reply

From April 2016 the number of qualifying years to get the full New State Pension has been 35 years, before that it was 30 years.

You can find out how many qualifying years you have by logging onto your government gateway

On the main page go to the bottom and click on ‘View your personal Tax Account’

Then go to the National Insurance box and click on ‘view gaps in your record’ you will then get the summary below and details for each year

You have:

  • xx years of full contributions
  • xx years to contribute before 5 April 20xx (retirement year)
  • xx year when you did not contribute enough

Eligibility – New State Pension

You’ll be able to claim the new State Pension if you’re:

  • a man born on or after 6 April 1951
  • a woman born on or after 6 April 1953

The earliest you can get the new State Pension is when you reach State Pension age.

Your National Insurance record

You’ll usually need at least 10 qualifying years on your National Insurance record to get any State Pension. They do not have to be 10 qualifying years in a row.

This means for 10 years at least one or more of the following applied to you:

If you’ve lived or worked abroad you might still be able to get some new State Pension.

You’ll need 35 qualifying years to get the new full State Pension if you do not have a National Insurance record before 6 April 2016.

https://www.gov.uk/new-state-pension/your-national-insurance-record-and-your-state-pension

Qualifying years if you’re working

When you’re working you pay National Insurance and get a qualifying year if:

  • you’re employed and earning over £183 a week from one employer
  • you’re self-employed and paying National Insurance contributions

You might not pay National Insurance contributions because you’re earning less than £183 a week. You may still get a qualifying year if you earn between £120 and £183 a week from one employer.

Gaps in your National Insurance record

You may get gaps in your record if you do not pay National Insurance or do not get National Insurance credits. This could be because you were:

  • employed but had low earnings
  • unemployed and were not claiming benefits
  • self-employed but did not pay contributions because of small profits
  • living abroad

Gaps can mean you will not have enough years of National Insurance contributions to get the full State Pension (sometimes called ‘qualifying years’).

You may be able to pay voluntary contributions to fill any gaps if you’re eligible.

https://www.gov.uk/voluntary-national-insurance-contributions

steve@bicknells.net

What is the Kick Start Scheme? Reply

You can use the Kickstart Scheme to create new 6-month job placements for young people who are currently on Universal Credit and at risk of long-term unemployment. The job placements should support the participants to develop the skills and experience they need to find work after completing the scheme.

Funding is available for 100% of the relevant National Minimum Wage for 25 hours a week, plus associated employer National Insurance contributions and employer minimum automatic enrolment contributions. There is also £1,500 per job placement available for setup costs, support and training.

Funding is available following a successful application process. Applications must be for a minimum of 30 job placements. If you are unable to offer this many job placements, you can partner with other organisations to reach the minimum number.

If you are a representative applying on behalf of a group of employers, you can get £300 of funding to support with the associated administrative costs of bringing together these employers.

Kickstart is not an apprenticeship, but participants may move on to an apprenticeship at any time during, or after their job placement.

The Kickstart Scheme is available in England, Scotland and Wales.

https://www.gov.uk/guidance/check-if-you-can-apply-for-a-grant-through-the-kickstart-scheme#who

steve@bicknells.net