For those who are self-employed, to those running or working in smaller or larger businesses, here’s the financial support you can receive from the government

On 4 January 2021, the government announced another national lockdown, meaning employees had to return to remote working, and some businesses had to close. As a result, Rishi Sunak announced a £4.6bn fresh financial support package for struggling UK companies during the lockdown. Here we review some of the current types of financial support in place for employers and employees.

 

Furlough scheme

The Coronavirus Job Retention Scheme has been extended several times and is currently open until September 2021. Employers will be expected to pay 10% towards the hours their staff do not work in July, increasing to 20% in August and September

Payroll teams can claim for employees on any type of employment contract, including full-time, part-time, agency, flexible or zero-hour contracts.

 

Self-employed income support

For the self-employed, financial support is available via the Self-Employment Income Support Scheme (SEISS), which provides 80% of trading profits.

It is calculated based on 80% of three months’ average trading profits, paid out in a single instalment and capped at £7,500.

A fourth grant under the Self-Employment Income Support Scheme (SEISS) scheme will run from February until April, covering up to 80% of three months’ trading profits up to £7,500.

There will be a fifth grant from May to September.

 

Statutory sick pay

The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the Statutory Sick Pay paid to current or former employees.

This scheme is for employers and you can claim back up to two weeks of SSP if:

  • You have already paid your employee’s sick pay (use the SSP calculator to work out how much to pay)
  • You’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • You have a PAYE payroll scheme that was created and started on or before 28 February 2020
  • You had fewer than 250 employees on 28 February 2020 across all your PAYE payroll schemes

You can make more than one claim per employee, but you cannot claim for more than two weeks in total.

You must have paid your employees’ sick pay before you claim it back, but if you use an agent who is authorised to do PAYE online for you, they will be able to claim on your behalf.

 

Support for local businesses?

For local businesses, support is available under the Local Restrictions Support Grant (for closed businesses) and Local Restrictions Support Grant (for open businesses) schemes.

Under such schemes, businesses with a rateable value of £15,000 or under can receive financial support worth £4000, businesses with a rateable value between £15,000 and £51,000 can get £6000, and for businesses with a rateable value of over £51,000, £9000 can be provided.

 

Support for larger businesses

The Coronavirus Large Business Interruption Loan Scheme helps medium and large-sized businesses to access loans and other kinds of finance up to £200 million.

The government guarantees 80% of the finance to the lender but the scheme is only open to applications until 31 March 2021.

You can apply for a loan if your business:

  • is based in the UK
  • has an annual turnover of over £45 million
  • has not received support under the Bank of England’s COVID-19 Corporate Financing Facility (CCFF)

You need to show that:

  • your business would be viable were it not for the pandemic
  • your business has been affected by coronavirus
  • the loan will enable you to trade out of any short-term to medium-term difficulty resulting from coronavirus

Visit the gov.uk website for more information on this scheme.

For more information on the various types of financial support available during the pandemic, visit gov.uk.

 

This blog post was updated on 3 March 2021 to reflect updates to the furlough and self-employment schemes.