Rishi Sunak’s Summer statement
This is a summary of Rishi Sunak’s Summer statement 2020 which details the support and changes which will be taking place over the coming months.
Support for businesses
Several support measures have been announced by The Chancellor, Rishi Sunak, to support employers and employees These new measures are designed to support businesses and to protect jobs. There is a drive by the Government to support youth unemployment and give support to the economy.
Job retention bonus
The Government will pay a one-off bonus of £1,000 to employers for each of their furloughed employees who returns to work and remains continuously employed until 31 January 2021.
To be eligible for the bonus, the employee must have been paid an average of £520 per month between November and January.
Full details of the scheme are expected at the end of July.
Coronavirus Job Retention Scheme will finish at the end of October 2020 and will not be extended.
New ‘kickstart’ jobs scheme
To assist with youth unemployment, the Chancellor announced a ‘kickstart’ plan.
Employers will receive funding if they create a new job with a minimum of 25 hours per week for a person aged between 16 and 24-years-old who is at risk of long-term unemployment and claiming Universal Credit.
The available funding will pay for the employee’s National Minimum Wage for 25 hours a week (plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions) for six months.
Employers will be required to provide training to the new employee and support them in gaining a permanent role. The scheme will run from August 2020 with jobs expected to start in the Autumn.
Apprenticeships and traineeships
From August 2020 to January 2021, the Government will pay employers to create new apprenticeships.
Employers will be eligible to receive £2,000 for each new apprentice they hire who is under the age of 25 and £1,500 for each new apprentice aged 25 or over. This is in addition to the existing £1,000 payment the government already provides for new 16 – 18-year-old apprentices and those aged under 25 with an Education, Health and Care Plan.
The Government also plans to triple participation in traineeships by funding employers who provide trainees with work experience at a rate of £1,000 per trainee.
There has been a temporary change in Stamp Duty to try and ignite the housing market. Until now, in England and Northern Ireland, stamp duty has been paid on land or property sold for £125,000 or more. There are different rates and systems in Scotland and Wales.
Buyers usually pay their duty based on the price on the day the sale is completed and pay HM Revenue and Customs within 14 days. This threshold in England and Northern Ireland will increase – with immediate effect – to £500,000 until 31 March.
Eating out and going away in the UK
The sales tax – VAT – included in the cost of food, accommodation and attractions will be cut until mid-January from 20% to 5%
VAT will be charged at 5% (rather than 20%) from 15 July 2020 to 12 January 2021 on the following supplies:
- food and non-alcoholic drinks from restaurants, pubs, bars, cafés and similar premises; and
- accommodation and admission to attractions across the UK.
- The temporary cut should see prices fall when eating out or going out which it is hoped will encourage people to go out to restaurants.
Further details to be released by HMRC
Introduction of “Eat Out to Help Out” scheme.
In a further measure to encourage consumers back to bars and restaurants this scheme will entitle every diner to a 50% discount on their meal, up to £10 per head (including children). There will be a list of participating restaurants, cafés, pubs or food service establishments. These businesses will be reimbursed fully for the discount applied.
The discount can be used an unlimited amount of times, but it is only available Monday to Wednesday during August. It applies to any eat-in meal and includes non-alcoholic drinks.
Qualifying Business will need to register to reclaim the value of the discount.
A scheme, which starts in September, the government will pay at least two-thirds of the cost of home improvements that save energy. This will be paid as a voucher when the work is approved.
We will update when more details become available but do call us if you need any help with your accounting or tax advice.