Delivering a speech in Parliament, the Chancellor announced a package of measures aimed at protecting jobs and helping businesses through the uncertain months ahead. This includes the measures as outlined below;
Job Support Scheme
The Job Support Scheme, which will replace the furlough scheme, will see workers get three quarters of their normal salaries for six months. Please see our separate blog for further details on this www.rushtonsaccountants.com/blog/archive/article/2020/September/job-support-scheme-factsheet
VAT cut for the tourism and hospitality sectors
As part of the package, the government also announced it will extend the temporary 15% VAT cut (from 20% to 5%) for the tourism and hospitality sectors to the end of March 2021.
Those 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.
We await further details on this measure to confirm if how the extension can be applied for.
Self-assessment taxpayers will be able to benefit from a 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.
We await further details on this measure to confirm of how the extension can be applied for.
Repayment of loans
The Government are introducing a new Pay as You Grow flexible repayment system for those businesses who took out a Bounce Back Loan.
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 are also giving 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.
In addition, the Chancellor also announced he would be extending applications for the government's coronavirus loan schemes until the end of November. As a result, more businesses will now be able to benefit from the Coronavirus Business Interruption Loan Scheme, the Coronavirus Large Business Interruption Loan Scheme, the Bounce Back Loan Scheme and the Future Fund. This change aligns all the end dates of these schemes, ensuring that there is further support in place for those firms who need it.