Furlough Scheme Extension – What We Know
New Measures from November
Following the government’s announcement at the weekend, as of 5 November 2020, increased restrictions are being implemented to help manage the COVID-19 situation. Recognising the additional strain these restrictions may place on many UK businesses, the government has extended the Furlough Scheme which was due to come to an end on 31 October.
This is welcome news for many employers, particularly as the support offered by the scheme appears to be returning to the same level as August this year with the government paying 80% of wages and salaries for the hours furloughed employees do not work. As before this is subject to the cap of £2,500 for periods from 1 November.
Employers will pay all employer National Insurance Contributions (NICs) and pension contributions in respect of hours not worked. They can also choose to pay additional wages beyond the 80% paid by the UK government to top up their employees’ salaries should they wish.
Eligible Employers and Employees
It is not necessary that the employer has used the Furlough Scheme previously in order to utilise this extension. Similarly, it is not required that the employee has previously been placed ‘on furlough’ either. Any employee who was on the payroll on 30 October 2020 will be eligible under the scheme.
Additionally, employees can also qualify if they were on the payroll on 23 September and have subsequently been made redundant or ceased working for the employer.
Self-Employment Income Support Scheme (SEISS) Grant Extension
Similar extensions have been made to the Self-Employment Income Support Scheme (SEISS), with grants increased to 55% of average trading profits from the previous 40%.
The exact details of the scheme are yet to be published and we look forward to reviewing this in the coming days.
Should you have any questions in the meantime, please do get in touch.
Following the announcement on November 5th, the government has published further details concerning the extension of the furlough scheme.
The main updates are:
– The furlough scheme has been extended to 31 March 2021 for all parts of the UK.
– Employers nor employees need to have used the scheme previously.
– For all employees furloughed for the first time from 1st November, the employer must have a signed agreement in place by 13thNovember. After this deadline, the furlough scheme can start only from the date of the signed agreement.
– There are now monthly deadlines for claims:
— From 1 November: claims need to be submitted 14 calendar days after the month-end
— Up to 31 October: claims need to be submitted on or before 30 November.
– Self-Employed assistance increased from 55% to 80%
For more details click here.