Summer Statement

The Chancellor outlined some very important changes in Summer Statement where he encouraged firms to keep on furloughed workers, cut VAT to 5% for the hospitality and tourism sector and increased the SDLT threshold to get the property market moving.

We’ve highlighted the changes below.  As with the budget, the devil is in the detail and this will be forthcoming over the next few days, 

Furlough Bonus

The furlough scheme will not be extended past October.  Instead a Jobs Retention Bonus was introduced.  This incentivises employers to bring back furloughed staff through to January in exchange for a £1,000 bonus per employee.

For businesses to qualify for this bonus the employee should be on a wage of at least £520 on average each month from November to January 2021.

Kickstarter Scheme

The Kickstarter Scheme was announced.  This is designed to help young people hit hard by the coronavirus-ravaged job market. The £2bn funded programme aims to create six-month work placements with a minimum of 25 hours per week for the under 25s.

The government will pay for the six month placement, plus an amount to cover overheads. All together the grant is worth around £6,500.

The application process opens next month, with the jobs intended to start from the autumn.

In addition to the kickstarter scheme, employers were encouraged to create new apprenticeships.  The government will contribute £2,000 per apprentice and businesses will also receive a £1,500 bonus if they hire apprentices aged 25 or over.

Stamp Duty

The Chancellor announced a cut to stamp duty to boost the housing market.  From midnight on 8th July, residential SDLT in England and Northern Ireland temporary increases from £125,000 to £500,000 until 31 March 2021, bringing the average stamp duty bull down to £4,500.

VAT Cut

In order to get “pubs, restaurants, cafés and B&Bs bustling again”,  VAT was reduced in the hospitality sector from 20% to 5%.   This cut will come into effect from 15th July until 12th January.

The VAT cut will apply to food and non-alcoholic drinks from restaurants, pubs, bars, and cafés. It also extends to accommodation and admissions to attractions like cinemas, theme parks and zoos.

Green Home Grants

As well as a stamp duty cut, the Chancellor hopes a £2bn green home grant will ensure the housing market has a green recovery.  Homeowners and landowners will be able to apply for vouchers up to £5,000 (£10,000 for low-income households).

Eat Out to Help Out

The Eat Out to Help Out discount was introduced to help the hospitality sector/  This will be available to everyone in the country throughout August.

Diners will be entitled to a 50% discount up to £10 per head off their meal at any participating restaurant, café, pub or eligible business which serves food from Mondays to Wednesdays.

Businesses will be able to register for the scheme from Monday and they will be reimbursed each week in August with the funds arriving in their bank account within five working days.