Yesterday, Chancellor Rishi Sunak delivered the summer economic plan to help the UK recover from the Coronavirus pandemic, including plans to protect jobs.
Below we have summarised the main points.
The ‘Plans for Jobs’ document that was published after the budget speech confirms the reforms have been delayed until April 2021 ‘This means that businesses and individuals do not need to implement and adjust to the reform while dealing with the economic impact of COVID-19.’ Preparations must however begin well in advance of this date which is something Sterling can assist contractors and agencies with. It is now more vital than ever to ensure you are prepared given the fragility of the current economic climate, businesses cannot afford to be facing increased tax liabilities, and the loss of workers through failure to prepare adequately.
Furlough Scheme Bonus
The Furlough scheme does come to an end in October 2020, however a Furlough scheme bonus was announced yesterday, giving businesses a £1,000 bonus for each employee brought back from Furlough. The employee must be paid a minimum of £520 per month and must be working continuously from November to end of January for the business to be eligible for the claim.
The VAT cut will apply to eat-in or hot takeaway food and non-alcoholic drinks from restaurants, cafes and pubs, accommodation in hotels, B&Bs, campsites and caravan sites, and attractions like cinemas, theme parks and zoos.
Rishi Sunak said this “£4bn catalyst” would help protect “over 2.4 million jobs”. The Treasury said it hoped firms would pass the VAT savings on to customers but many had been without income for months so it would be their decision.
Stamp Duty tax holiday
A temporary holiday from paying Stamp Duty was announced on all property purchases up to £500,000. The purpose of this is to help to stimulate the property market. The holiday will last for 8 months up until 31st March 2021 and commenced at midnight today.
Eating out discounts
The chancellor also announced an “Eat Out to Help Out” discount, which he said would help protect 1.8 million jobs. At participating restaurants, cafes or pubs, diners will be entitled to 50% of their meals up to £10 per head, including children. The discount is valid Monday – Wednesday throughout August.