Government Extends its Furlough Scheme to March and increases Self-Employed Support

The government has extended its furlough scheme until the end of march, with employees receiving 80% of their current salary for hours not worked.

The government also revealed that the self-employment income grant will also increase from 55% to 80% of average profits – up to £7,500.

The furlough scheme was initially extended until 2 December. But the government is now going further so that support can be put in place for long enough to help businesses recover and get back on their feet – as well as giving them the certainty they need in coming months. Evidence from the first lockdown showed that the economic effects are much longer lasting for businesses than the duration of restrictions. This means the furlough scheme will have been in place for a year.

There are currently no employer contribution to wages for hours not worked. Employers will only be asked to cover National Insurance and employer pension contributions for hours not worked. For an average claim, this accounts for just 5% of total employment costs or £70 per employee per month. The CJRS extension will be reviewed in January to examine whether the economic circumstances are improving enough for employers to be asked to increase contributions.

On top of this, the government has announced:

  • cash grants of up to £3,000 per month for businesses which are closed worth more than £1 billion every month
  • £1.1 billion is being given to Local Authorities, distributed on the basis of £20 per head, for one-off payments to enable them to support businesses more broadly
  • plans to extend existing government-backed loan schemes and the Future Fund to the end of January, and an ability to top-up Bounce Back Loans
  • an extension to the mortgage payment holiday for homeowners
  • up to £500 million of funding for councils to support the local public health response.
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You can check your eligibility for furlough scheme here.

If you are self emploued, you can check your eligibility here.

For more information please contact us on 01702 345 207 or email us at info@arb.accountants

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