As we sail into the second half of 2020, July has provided plenty of coronavirus-related news stories. Many of these updates prove how disruptive the pandemic has been, but also show how the government is putting measures in place to stabilise the economy as quickly as possible.
If you’ve missed any news stories from the last month, here’s our latest contractor-focused month in review.
Economy may take four years to recover to pre-pandemic levels
Analysis from the EY Item Club has suggested that it could take until 2024 for the UK economy to return to pre-pandemic levels. The UK has most likely passed the lowest point, but the economic recovery is likely to take much longer to recover than first expected, around 18 months.
The pandemic has hit business hard, consumer caution has created a new form of shopping habit and stores appear to be quieter than pre-pandemic levels. The Chancellor, Rishi Sunak, released a set of measures during his announcement of the ‘Plan for Jobs’ to raise customer spending, in order to boost the economy and prevent further job losses.
Announcement of the ‘Plan for Jobs’
Rishi Sunak delivered the Summer Statement on 8th July, this contained a collection of updates on the country’s economic performance over the last few months. As expected, the country has suffered as a result of the coronavirus pandemic, however the ‘Plan for Jobs’ outlined measures designed to support the economy through these testing times.
These measures include:
- Kickstart Scheme, designed to create jobs for under 25-year-olds
- Eat Out to Help Out Scheme
- The Job Retention Bonus
- Stamp duty holiday for house purchases under £500,000, until March 2021
- Temporary reduction in VAT rates for businesses in the tourism and hospitality sectors
Update to the Self-Employed Income Support Scheme (SEISS)
The Self-Employed Income Support Scheme (SEISS) has offered financial support to the self-employed, replacing lost income as a result of the pandemic. The 13th July marked the final day for self-employed workers to apply for the first round of the scheme, the scheme is closed to new claims for the first grant.
Workers who are eligible for the SEISS grant and applied before the 13th July deadline, will receive 80% of their average profits up to a maximum figure of £7,500. This grant will cover three months’ worth of profits and will be paid in a single instalment.
The scheme has been extended which is welcome news to the self-employed community, however the lower percentage of 70% of average trading profits will be paid (compared to 80% in the first round of the scheme) and payments will be capped at £6,570. Businesses who have been impacted as a result of the pandemic on or after 14th July 2020, and are able to prove this to HMRC, will be able to start making claims from 17th August 2020.
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