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29 May 2020

Rishi Sunak extends the Self-Employment Income Support Scheme and outlines next steps for the Coronavirus Job Retention Scheme

Introduced by

HM Treasury

Targeted at

Businesses and self-employed people

Timings

Coronavirus Job Retention Scheme (CJRS) first announced on 20 March 2020, later extended, with changes to the scheme announced on 12 May. Further detail on CJRS and extension of Self-Employment Income Support Scheme (SEISS) on 29 May

Stated aims

To give 'more security to individuals whose livelihoods are adversely affected by coronavirus in the coming months'

Summary

Chancellor Rishi Sunak extends the Self-Employment Income Support Scheme (SEISS) and clarifies next steps for furloughed workers under the Coronavirus Job Retention Scheme (CJRS).

Under SEISS, those eligible will be able to claim a second and final grant in August. The grant will be worth 70% of their average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, capped at £6,570 in total.

Under the CJRS:

  • Employers will be able to bring back employees part time from 1 July 2020 (a month earlier than previously announced).
  • From August the government grant will be 'slowly tapered'. The government will continue with the existing grant in June and July. In August the government will pay 80% of wages up to a cap of £2,500 and employers will pay employer National Insurance (ER NICs) and pension contributions ('for the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed').
  • In September the government will pay 70% of wages up to a cap of £2,187.50, employers will pay ER NICs and pension contributions, and 10% of wages (to make up 80% total) (represents 14% of gross employment costs for the average claim)
  • In October the government will pay 60% of wages up to a cap of £1,875, employers will pay ER NICs and pension contributions, and 20% of wages (to make up 80% total up to a cap of £2,500) (represents 23% of gross employment costs the employer would have incurred without furlough for the average claim).
Source(s)

Gov.uk news story