Posted by Nick Day on 08 Jul 2020
Chancellor’s Summer Statement – SDLT Holiday, Hospitality VAT Cut and Staff Furlough Bonus
The Chancellor has outlined a series of proposals, designed to stimulate economic recovery and protect jobs.
Job Retention Bonus
The Job Retention Scheme, under which the government paid a significant part of employer costs relating to furloughed employees, is being wound down from August. In an effort to encourage employers to continue employing furloughed staff, employers will be able to claim a £1,000 one-off payment for every furloughed employee.
The bonus will apply in respect of employees who earn an average monthly wage of more than the Lower Earnings Limit (currently £520 per month) and who remain continuously employed until at least 31 January 2021.
The bonus payments will be made in February 2021. Additional details are expected this month.
The nil rate band for Residential SDLT has been temporarily increased from £125,000 to £500,000. This increase is immediate and will remain in force until 31 March 2021. Keep in mind that other SDLT measures, such as the 3% surcharge on second homes remain in force.
Not only will this reduce costs when buying a new home, but it may mean that now is a good time to consider restructuring ownership of any investment properties you hold in your own name.
VAT is to be cut from 20% to 5% on certain leisure and hospitality services, such as restaurants, cafes, pubs, cinemas and zoos. This reduction is effective from 15 July until 12 January 2021. The VAT reduction does not apply to alcohol.
This reduction will be paired with the “Eat out to Help Out” scheme, entitling diners to a 50% discount of up to £10 per head on a meal purchased at a participating establishment. The reduction will be available every Monday – Wednesday in August and there is no limit to how many times a discount can be claimed. Once again, alcohol is excluded.
Jobs for the Young
A new Kickstart scheme is being introduced that will fund 100% of the National Minimum Wage (up to 25 hours a week) and the associated National Insurance/automatic enrolment contributions for 6-month work placements. These placements are aimed at those aged 16-24 who are on Universal Credit and deemed to be at risk of long-term unemployment.
The government will also fund employers who provide high-quality work placements and training for 16-24-year olds, at a rate of £1,000 per trainee.
Payments of £2,000 will be made to employers for each new apprentice they hire, aged under 25, along with payments of £1,500 in respect of new apprentices who are aged 25 and over. This scheme will operate from 1 August 2020 to 31 January 2021 and will be in addition to the current £1,000 payment for new 16-18-year-old apprentices.
We will provide updates when more information becomes available.
If you would like any advice regarding any of these changes or schemes, or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or firstname.lastname@example.org