Martin Sanchez unsplash kTMISiScL7YCoronavirus Support July – Vat, Jobs, Apprenticeships, Eat out to help out & Stamp Duty to name a few

Well, the support keeps coming. Chancellor, Rishi Sunak has put forward, his plan for jobs, in his Summer Statement.
So now the UK is moving into the second stage of the Coronavirus driven government economic support.
So apparently £49 billion has already been provided to public services since March and the chancellor has made a further, £160 billion available in funding for job retention, income, and business support.
 

Job Retention Bonus

So, whilst the Coronavirus Job Retention Scheme or Furlough Scheme as everyone’s come to know it and now of course from the 1st of July, the new flexible furlough scheme will come to an end in October.

  • There is now a newly announced, a £1000 per employee job retention bonus, which is available to UK employers who keep their formerly furloughed employees continuously employed through till at least the 31st of January, 2021. In order to qualify, they must be paid at least £520 a month, on average, from November 2020 to January 2021.  The idea behind this scheme is to prevent mass redundancies when the Furlough scheme comes to an end in October 2020.

 

Kickstart Scheme

Additionally, a £2 billion kickstart scheme will help to subsidise six-month work placements for 16 to 24-year old’s who are currently on universal credit and a risk of long-term unemployment. 

  • There is no cap to the number of places. 
  • Funding is available (it will also cover the associated Employers NIC and minimum Automatic Enrolment pension contributions,) for each placement up to 25 hours per week paying a 100 percent of the national minimum wage.  Although employers can top up this wage.
  • These will have to be new jobs, and employers will need to offer kickstart training and support to find a permanent job.

Employers can apply to be part of this scheme from next month – August 2020 with the first jobs starting in the autumn.
 

Apprenticeships

For the next six months government will pay employers to create new apprenticeships. 

  • Businesses will receive £2000 for every under 25 apprentice, they hire in addition to the existing £1000 payment available for certain apprentices.
  • A new bonus to take on apprentices aged over 25 has also been announced.  This will amount to £1,500 per appointment.  So that’s going to be another £1.6 billion, that’s going to be invested in employment, support schemes with the focus, on opportunities for young people.

 
So clearly, these measures, whilst it’s not going to necessarily pay the salaries of your employees, it’s certainly going to help in the current climate where everybody is coming out of locked down.  People are clearly concerned about, business in the future. The message coming out from the chancellor is that if you stand by your workers, we will stand by you.
 

VAT

Also announced was, a reduction in the VAT rate to boost the leisure and hospitality sectors.

  • So Vat will be cut to 5% on food, accommodation and attractions starting on the 15th of July. 
  • It will run for the next 6 months and should help as it covers eat in or hot takeaway food in restaurants, cafes, pubs, cinemas, theme parks and zoos. 
  • It will see VAT cut from 20% to 5% for food and non-alcoholic drinks and to accommodation and admission to attractions. 
  • It will apply from 15th July 2020 until 12th January 2021, benefiting over 150,000 businesses and protecting 2.4 million jobs, according to Rishi Sunak.
  • The Vat reduction also applies to all holiday accommodation in hotels, B & B’s, campsites and caravan sites.

 

Eat out to help out

Also, a new initiative called “Eat out to help out” discount has  been created for the month of August. 

  • Again, for the heavily impacted hospitality, leisure, and tourism industries.
  • So, from a Monday to Wednesday meals eaten at the participating businesses (eat in only), will have 50% off, including non-alcoholic drinks. Apparently, this is because people are cautious about going out.
  • It’s going to be a maximum discount of £10 pounds per head, including children. 
  • The businesses where the vouchers will be used, will need to register to claim their cash back.
  • To access the discount businesses will need to register and can do so through a website that will be open next Monday 13th July 2020. 
  • Businesses will be able to claim the money back weekly, funds will be deposited into their bank accounts within five working days.

We’re not totally sure how this is going to work, it appears you will give the reduction to the customer, and claim it back using this portal. As it says, funds will be deposited within five days now, clearly that could have a potential impact on your cashflow. So, you do need to be aware of that, but hopefully this will encourage people to go out, and go back to cafes, etc.
 

Green Jobs initiative

Also announced was, £8.8 billion in new infrastructure, decarbonization and maintenance projects plan. The goal of this is to create new jobs, and a £3 billion green investment plan, to support jobs.

  • From September 2020 there will be a green homes grant, which offers vouchers up to £10,000 to homeowners and landlords who make their homes more energy efficient. The £2bn Green Homes grant will cover at least two-thirds up to £5,00 per households. 
  • For low income households these grants will cover all costs up to £10,000.  There will also be a further £1billion allocated to make public buildings greener.

 

Stamp Duty Land Tax

Boost for the housing market.  Presently, in England and Northern Ireland (different amounts apply in the regions) no Stamp Duty Land Tax is payable on residential property purchases below £125,000. 

  • Immediately, the nil rate band of residential stamp duty land tax will be temporarily increased to £500,000 until the 31st of March next year 2021.  This is in a bid to support the construction and housing sector. So, if you’re buying a house for under £500,000, you won’t have to pay stamp duty.  It is projected this will reduce the average stamp duty bill by £4,500.  Regional variations may apply. 
  • Purchasers buying a second residential property will still have to pay the 3% Stamp Duty Land Tax for property purchases up to £500,000.

 
As more details are announced we will publish accordingly.

Would you help us please?

We are aware that some accountants have not been as forthcoming with help and support.  Would you share our Facebook group, what’s app and you tube channel with your business owner –  friends, colleagues and family members.  We want to help business owners not only survive but thrive as we come out of lock down.  

Hopefully you already know and are connected but just in case: – Don’t forget to join our private Facebook and What’s App groups and subscribe to our you tube channel

Facebook group

The South Manchester (and surrounding areas) Business Community where we share and help each other in business.  Please feel free to share with fellow business owners in the region.  https://www.facebook.com/groups/537335273633016/

What’s App Group

Also feel free to join our KMA Accountancy Covid-19 support what’s app group. We post support and answers to questions that are aimed at helping business owners.
https://chat.whatsapp.com/HzkS9K2vNvd8zaEhNV3toY
 
KMA You Tube Channel

Also follow us on you tube where we post lots of videos again aimed at helping you to have the best business for you!

https://www.youtube.com/channel/UCNWmsgvUCJPyoPpKEJXG_MQ?view_as=subscriber

If you have any questions on this or anything else, just drop us a line to wecare@kmaaccountancy.co.uk or call us on 0161 410 0020.

Disclaimer
The comments above do not count as advice on which you should rely on. It is provided for general information purposes only. Professional or specialist advice should always be sought before taking any action relating to the above. We make no representation, warranty, or guarantee that the comments above will meet your requirements. The comments above are subject to change.
It is important that you take professional advice before making any decisions based on the information that you learnt here. While every effort has been made to make sure it is accurate it cannot be precisely tailored to your personal circumstances.This article is for general information only and no action should be taken, or refrained from, as a result of this information.  Professional advice should be taken based on specific circumstances in each individual case.  Whilst we endeavour to ensure that the information contained in the article is correct, no liability  will be accepted by KMA Accountancy which is a trading name of Kim Marlor Associates Ltd or damages of any kind arising from the contents of this communication, or for any action, inaction  or decision taken as a result of using any such information.  We are not making any recommendations on anything contained in this post  or the guide. 
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