Confused about financial support amidst coronavirus? The NHBF outlines what’s available
By Guest Writer | 05 November 2020 | Movers & Shakers, News
As England dives into a second national lockdown, the National Hair & Beauty Federation (NHBF) is continuing to lobby for further support for hair and beauty businesses.
The industry body is pushing for a reduction in VAT to 5%, further business rates relief, an extension to eviction protection from landlords and student loan-style repayment plans for bounce back loans.
Richard Lambert, NHBF chief executive comments: “As we enter a second national lockdown in England, our immediate concern is that local councils start distributing the grant funding they have been given by the government to support businesses affected by the lockdowns as soon as possible.
“Hair and beauty businesses are hugely anxious about how they will meet their financial commitments if they can’t work. Most are likely to have no safety buffer of surplus or savings to fall back on second time around. We are therefore continuing to push for further support to help businesses survive throughout this difficult period”.
The latest measures available to businesses are as follows:
Job Retention Scheme: Furlough
In an announcement today (5 November), the furlough scheme has been extended until the end of March 2021. It had been due to finish at the end of October 2020.
You can bring furloughed employees back to work on a part-time basis or furlough them full-time. Employers must pay National Insurance and employer pension contributions. Employees will receive 80% of their salary for hours not worked up to a maximum of £2,500.
Job Support Scheme
PLEASE NOTE: The Job Support Scheme, which was scheduled to come in on Sunday 1 November, has been postponed until the furlough scheme ends.
If businesses are legally required to close, the government will cover the cost of two thirds of employees’ salaries where they can’t work for a week or more. Employers must cover National Insurance and pension contributions where applicable.
If businesses are still open but adversely affected by coronavirus, the government is making it easier to keep employees on:
- Employees must work a minimum of 20% of their hours. The employer will pay the wages for these hours.
- For every hour not worked, the employee will be paid two-thirds of their usual salary. The employer will contribute 5% to a cap of £125 a month, with the rest paid by the government to a cap of £1,541.75 a month.
Job Retention Bonus
The Job Retention Bonus is a £1,000 one-off taxable payment to the employer for each eligible employee that you furloughed and kept continuously employed until 31 January 2021.
You’ll be able to claim the bonus between 15 February 2021 and 31 March 2021. You do not have to pay this money to your employee. Find out more on the government website.
Self-employed Income Support Scheme
The government is offering two grants, each available for three-month periods covering November 2020 to January 2021 and February 2021 to April 2021.
Grants will be paid in two lump sum instalments each covering a three-month period.
The first grant will cover a three-month period from 1 November 2020 until 31 January 2021. The government will provide a taxable grant covering 55% of average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £5,160 in total.
The grant for November will be increased from the previously announced level of 40% of trading profits to 80%, returning to 40% for December 2020 and January 2021. This therefore increases the total level of the grant from 40% to 55% of trading profits for 1 November 2020 to 31 January 2020.
The second grant will cover a three-month period from 1 February 2021 until 30 April 2021. The Government will review the level of the second grant and set this in due course.
The grants are taxable income and also subject to National Insurance contributions.
UPDATE 5 NOV:
The Self-Employed Income Support Scheme has been extended to cover 80% of profits for the period November to January up to £7,500. Both schemes will be reviewed in January.
This support will apply to England, Scotland, Wales and Northern Ireland.
Salons or barbershops forced to close in England due to local or national restrictions will be eligible for the following:
- For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks.
- For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks.
- For properties with a rateable value of £51k or over grants to be £3,000 per month, or £1,500 per two weeks.
Visit your local authority’s website to find out how to apply. Find your local authority on the government website.
£1.1bn is also being distributed to local authorities so they can make one-off payments to help support businesses.
- The Business Interruption Loan Scheme provides loans of up to £5m, with no interest due for 12 months. The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months. Open for applications until 31 January 2021.
- The Bounce Back Loan helps small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover. The maximum loan available is £50,000. The government guarantees 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year. Open for applications until 31 January 2021.
Claim back Statutory Sick Pay
The Coronavirus Statutory Sick Pay Rebate Scheme will repay employers the Statutory Sick Pay paid to current or former employees who are off sick for coronavirus-related reasons. Find out more on the government website.
Subject to restrictions being lifted, businesses will be able to re-open on Thursday 3 December.