Chancellors Summer Statement

Wow – well hats off to the Chancellor this week with his much-anticipated Summer Statement. Although I feel that the government has, at times, been clumsy in the way they have handled the Covid-19 crises they must be given credit for their commitment in their efforts to try and mobilise the economy.

The Chancellor revealed a whole host of new initiatives which will impact large numbers of individuals and businesses.

The Job Retention Bonus

This is a one-off payment of £1,000 to employers that have used the Coronavirus Job Retention Scheme (CJRS) for each furloughed employee who remains continuously employed until 31‌‌‌ ‌January 2021. The bonus will provide additional support to retain employees.

To be eligible, employees will need to:

  • earn at least £520 per month (above the Lower Earnings Limit) on average for November, December and January
  • have been furloughed by the business at any point and legitimately claimed for under the Coronavirus Job Retention Scheme
  • have been continuously employed by you up until at least 31‌‌‌ ‌January 2021.

Employers will be able to claim the bonus from February 2021 once accurate RTI data to 31‌‌‌ ‌January has been received. More information about this scheme will be available by 31‌‌‌ ‌July and full guidance will be published in the Autumn.

Other new measures announced

The Chancellor also announced other measures, including:

  • the Eat Out to Help Out Scheme – during August, diners can get 50% off Monday to Wednesday on meals and non-alcoholic drinks, up to £10 per person, when eating at participating restaurants, bars, cafes and other establishments that have registered
  • VAT reduction – from 15‌‌‌ ‌July until 12‌‌‌ ‌January 2021, the UK government will cut VAT from 20% to 5% on any eat-in or hot takeaway food and drinks from restaurants, cafes and pubs, excluding alcohol. This VAT reduction also applies to all holiday accommodation in hotels, B&Bs, campsites and caravan sites, as well as attractions like cinemas, theme parks and zoos
  • an increase in the Stamp Duty Land Tax (SDLT) threshold in England and Northern Ireland – increasing the threshold under which no SDLT is paid on the purchase of a main home from £125,000 to £500,000, with immediate effect until 31‌‌‌ ‌March 2021
  • A new “Kickstart” Job Scheme to create new jobs for 16 to 24yrs who are currently on Universal Credit. The government will pay young people’s wages for six months, plus an amount for overheads. The funding is conditional on these being new jobs, paid at national minimum wage and for at least 25 hours a week. Employers will be able to apply from next month, with the first Kickstarters in jobs in the autumn.
  • A green homes grant, from September homeowners and landlords will be able to apply for vouchers to make housing more energy efficient and to create local jobs. The government will cover two thirds of the cost up to £5,000 per household, and up to £10,000 for those on low incomes.

We have learnt from recent experience with, for example, the CJRS scheme that these announcements generate a large amount of administration. So we will be in touch with those it will impact first early next week to help implement the changes to vat thresholds.

Wishing you a great weekend ahead.

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