Coronavirus Job Retention Scheme

HMRC will set up a new online portal so that all UK employers, regardless of size, will be eligible for assistance where an employee has been designated as a ‘furloughed worker.’ HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.  The current plan is that this will be in place for 3 months, at which point it will be reviewed.  This will be backdated to 1 March 2020.

Employers must set out which of their employees are ‘furloughed workers’ and inform the particular employees. Furlough is the equivalent of lay off so you can lay off staff, continue to pay them and recover 80% of that cost up to a cap of £2,500 a month.

The current guidance for employees states that ‘You will remain employed while furloughed. Your employer could choose to fund the differences between this payment and your salary, but does not have to’. To qualify for this scheme the employee must not undertake any work for you while furloughed.

Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation.

Income Tax

The second payment on account of tax that is due by 31 July 2020 will be deferred until 31 January 2021.  Self-employed taxpayers are eligible for this deferment.  There is no need to apply for this offer as it is automatic.  No penalties or interest for late payment will apply during the deferral period.

Statutory Sick Pay

Individuals will be eligible for SSP from the first day of absence if the absence is Covid-19 related.  The individual will need to visit https://111.nhs.uk/ in order to obtain an isolation note in line with advice issued on Friday 20 March.  They will still be entitled to the normal maximum of 28 weeks in any 3-year period with the same employer, however, there is no need to wait for 3 working days before they would be eligible where Covid-19 applies.

Universal Credit

The self-employed will be eligible to make a claim for Universal Credit or new style Employment and Support Allowance. Self-employed people will receive a rate equivalent to SSP.

Mortgage and rent holiday

Tenants, as well as mortgage borrowers, can apply for a 3 month payment holiday.  Interest will continue to be charged on any amount that they owe.  The government has announced that the intention is that no one can be evicted from their home over the next 3 months where this applies.