Chancellor’s statement – What it could mean for BAGMA members
Chancellor Rishi Sunak announced new measures to support businesses and protect jobs this afternoon (Thursday, September 24).
Here, we look at the main points of his statement and what it could mean for BAGMA members.
Job Support Scheme
- Six-month scheme will start on November 1, 2020, following the end of the furlough scheme.
- To be eligible, employees work a minimum of 33 per cent of their hours.
- For the remaining hours not worked, the Government and employer pay a third of their wages each.
- So employees working 33 per cent of their hours will receive at least 77 per cent of their pay.
- All small and medium businesses are eligible, larger only where turnover fallen through crisis.
- Open to employers even if they haven’t used furlough scheme. Employers can claim support scheme and Coronavirus Job Retention Bonus.
- 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.
- Self-assessed income taxpayers who need extra help, can also now extend their outstanding tax bill over 12 months from January.
- The Government has extended the 15 per cent VAT cut for the tourism and hospitality sectors to the end of March, 2021.
Bounce Back Loans
- The application deadline for all coronavirus loan schemes – including the future fund – has been extended to November 30.
- Repayment terms can be extended from six to 10 years. Struggling businesses can choose for interest-only or up to six months suspended payments with no credit rating impact.
Pay as you Grow
- Businesses which have borrowed under the Bounce Back Loan Scheme will be offered the choice of more time and greater flexibility for their repayments.
- Lenders have been enabled to offer Coronavirus Business Interruption Loan Scheme (CBILS) borrowers more time to make their repayments where needed.
- The SEISS extension will support viable traders who are facing reduced demand over the winter months, covering 20 per cent of average monthly trading profits via a government grant (extended to April, 30, 2021).
Further details of the schemes will be released when they are available