On Wednesday 3rd March, Chancellor Rishi Sunak announced his new annual budget.
This blog post will summarise the key points and new changes to schemes in relation to businesses.
Recovery Loan Scheme
This is a new scheme that ensures that businesses can continue to access any loans and types of finance after existing COVID-19 loan schemes close.
- Businesses of any size can use the scheme.
- Finance of up to £10 million per business
- Can be used for any legitimate business purpose, including growth and investment.
- Government guarantees 80% of finance to the lender, so they have the confidence to lend to businesses.
The scheme launches on the 6th of April and runs until the 31st of December. Loans will be available through accredited lenders.
What type of finance is available?
- Term loans and overdrafts between £25,001 and £10 per business.
- Invoice finance and asset finance available between £1,000 and £10 million per business.
Is your business eligible?
Your business must be trading in the UK. You will also need to demonstrate that it would be viable if it wasn’t for the coronavirus pandemic and your business has been affected.
Your business will still be eligible if you have received support under the existing COVID-19 guaranteed loan scheme.
You can find out more details about this scheme here.
Changes to the Coronavirus Job Retention Scheme (from July 2021)
The scheme has been extended until the 30th of September 2021.
The level of grant available to employers under this scheme is also guaranteed to stay the same until 30th of June 2021.
The level of grant will be reduced, and the employer will be required to contribute more towards furloughed employee’ wages.
The table below highlights the changes from within the scheme.
|Government contribution: wages for hours not worked||80% up to £2,500||80% up to £2,500||70% up to £2,187.50||60% up to £1,875||60% up to £1,875|
|Employer contribution: employer National Insurance contributions and pension contributions||Yes||Yes||Yes||Yes||Yes|
|Employer contribution wages for hours not worked||No||No||10% up to £312.50||20% up to £625||20% up to £625|
|For hours not worked employee receives||80% up to £2,500 per month||80% up to £2,500 per month||80% up to £2,500 per month||80% up to £2,500 per month||80% up to £2,500 per month|
If you would like to read into more detail about the changes, please visit this page.
You can also check which employees you are able to put on the scheme here.