Insights 23.10.20 Author: Martina Fitzgerald

Winter Economy Plan Update

Insights 23.10.2020 Author: Martina Fitzgerald

Further to our previous article on the Winter Economy Plan dated 29 September, the Treasury announced on 22 October an update to the Job Support Scheme and the Self-Employment Support Scheme. Below is a summary of the main changes announced.

Job Support Scheme (JSS) Open

For businesses who can operate safely but face reduced demand, the scheme is as follows:

  • To be eligible, employees must work at least 20% of their normal hours, these hours will be paid by the employer in the usual way
  • For the hours not worked by the employee, the employer will pay 5% of the employee’s pay of up to a maximum of £125 per month with the discretion to pay more than this if they wish
  • The government will pay 61.67% of the employee’s usual pay for the hours not worked, capped at £1,541.75 per month
  • The employee will receive 73% of the salary where they earn £3,125 a month or less

Job Support Scheme (JSS) Closed

Where a business has been asked to close due to COVID-19 restrictions set by the Government, for these businesses the JSS (Closed) will apply. Each employee who cannot work due to these restrictions will receive two thirds of their normal pay to a maximum of £2,083.33 per month which will be funded by the Government. The employer can pay more to the employee if they wish.

The JSS will open on 1 November and run for six months until 30 April 2021. The Government intends to review the terms of the scheme in January. Claims can be made in arrears from 8 December. Further guidance on how to claim and the steps involved will be issued at the end of October.

For more information on the JSS (open and closed), please click here.

Self-Employment Income Support Scheme (SEISS)

The Chancellor has also announced increased support for the self-employed; the first grant covering 1 November until 31 January 2021. The grant will be 40% of the average monthly trading profits paid out in a single instalment, covering three months’ worth of profits capped at £3,750 (it was originally capped at £1,875).

What next?

If you have any questions regarding the latest updates, please contact our tax team.