The End Of The Furlough Scheme & Extension Of The Self-Employment Income Support Scheme

There has been lots of news to keep up with over the last few days with the most important snippets being the announcement by the Chancellor Rishi Sunak that the furlough scheme will end once the October payments are made, along with news on a final grant for the self employed in August.

• 

Furlough Scheme Extended Into October

Although the furlough scheme is being extended into October employers will find that they will be contributing more towards keeping their employees furloughed each month. There will also be some flexibility within the furlough scheme in July aimed at part-time employees.

It is also worth noting that employers will have to place any new employees on the furlough scheme before June 10th which is less than 2 weeks away.

How The Furlough Scheme Tapers Off Into October

Here are some details on how the furlough scheme will pan out over the next few months, these details have been copied from the Mortgage Solutions website:

“In June and July the government will pay 80 per cent of wages up to a cap of £2,500 as well as employer National Insurance (NICs) and pension contributions. Employers are not required to pay anything.

“In August the government will pay 80 per cent of wages up to a cap of £2,500. Employers will pay employer NICs and pension contributions. Treasury said for the average claim, this represented five per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.

“In September, government will pay 70 per cent of wages up to a cap of £2,187.50. Employers will pay employer NICs and pension contributions and 10 per cent of wages to make up 80 per cent total up to a cap of £2,500. Treasury added that for the average claim, this represented 14 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.

“Finally, in October government will pay 60 per cent of wages up to a cap of £1,875. Employers will pay employer NICs and pension contributions and 20 per cent of wages to make up the 80 per cent total up to a cap of £2,500. For the average claim, this will be around 23 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.”

Self Employment Income Support Scheme Grant

As for the Self Employment Income Support Scheme those people who are eligible will be able to access a second and final grant which will be capped at £6,750 in August.

For more help and advice on the latest government measures and how it will affect you and your business get in touch with the WHR Accountancy team by calling us on 028 3752 2909.