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The Chancellor, Rishi Sunak, has delivered a statement to the House of Commons outlining plans to help protect jobs across the UK whilst the country faces a resurgence of coronavirus and a winter of uncertainty. It has also been confirmed that the Budget that was expected to be delivered in the autumn will now take place next year. The main focus of the Chancellor’s announcements is a new Job Support Scheme and an extension to the Self Employment Income Support Scheme as well as additional flexibilities for businesses who have borrowed money as a result of the pandemic.
Details of these announcements follow:
Self-Employment Income Support Scheme extension
• The Chancellor announced additional help for the self-employed based on similar terms and conditions as the new Jobs Support Scheme.• The extended scheme will apply for 6 months from 1 November 2020 with an initial taxable grant made available to those who continue to trade and are currently eligible for SEISS. • The initial lump sum will cover three months of profits from 1 November 2020 calculated as 20% of average monthly profits, up to a total of £1,875. • An additional second grant will be available from 1 February 2021 to 30 April 2021, but the level of this second grant amount is subject to review.
Loan deadlines extended
• Businesses that have taken out a Bounce Back Loan will be able to benefit from a new Pay As You Grow flexible repayment system.• This will include an extension in the loan term from six to ten years. There will also be new options for interest-only repayments for up to six months as well as payment holidays. • The Coronavirus Business Interruption Loans will also have their Government guarantee extended to ten years. • The deadline for applying for all the Government’s coronavirus loan schemes will be standardised and pushed back until 30 November 2020. • A new successor loan guarantee programme is also expected to be introduced early next year.
New VAT Payment Scheme
• Businesses had the option to defer the payment of any VAT liabilities due between 20 March 2020 and 30 June 2020.• The deferred payment was due to be paid in full to HMRC by 31 March 2021. • The Chancellor has now confirmed that businesses will instead be able to make 11 smaller interest-free payments during the 2021-22 financial year.Self-Assessment payment deadlines• Taxpayers that were due to make their second payment on account for the 2019-20 tax year had the option to have the payment due date deferred until 31 January 2021. • It will now be possible to benefit from a separate additional 12-month extension from HMRC on the “Time to Pay” self-service facility for this payment and also for payments due in January 2021 extending the deadline until January 2022.