Reply to: Job Support Scheme

[cwah]

You've got your figures wrong.

So how it works for us
So let's take a typical contrator PAYE salary at £792/month.
- Get the scheme with 33% of the time worked. So get £261/month from LTD
- Then for the hours not worked, the amount is up to £530 for which the gov pay 1/3 (£175) and your LTD pay 2/3 (£355).

So you end up with the LTD paying 78% of the wage £616 and the gov 22% at £175


You are correct about getting the £261 (1/3) from the limited as that is what you worked. (You could have worked more than 1/3 of the time in that case the figures differ but the proportiosn stay the same - the scheme only covers 66% of the wages unpaid)

The remaining 2/3rds is where you have it wrong...

The first 33% of the unpaid 2/3rds is paid by the limited
The second 33% of the unpaid 2/3rds is paid by HMRC
The last 33% fo the unpaid 2/3rds is incurred by the employee in lost wages

So in this case the LTD pays 55%, HMRC 22% and the employee loses 22%

The wording of guidance on the HMRC website specifically says "we expect employers not to make this up to 100% out of their own funds" which is different to the CJRS where they encouraged employers to make it up to the 100% but did not force them

ahh that looks really tulip then. I didn't realise.

And of course, if we decide after the end of the scheme to top up the salary to compensate for the loss, then it could be seen as tax avoidance if investigated by HMRC...

Looks like a bad idea to take it for roughly £1000 max...

[SussexSeagull]

No. Did anyone here? I was working trying to find new clients and doing the odd hour of maintenance here and there for old ones. I suppose I could have fraudulently pretended I wasn't.

The flexi furlough scheme they introduced half way through would have been a nice help, but of course that was only offered to those who'd already benefitted from the full furlough. So annoying.

I was in contract until May so wasn't eligible.

[ittony]

Could you not have taken advantage of the original furlough scheme?

No. Did anyone here? I was working trying to find new clients and doing the odd hour of maintenance here and there for old ones. I suppose I could have fraudulently pretended I wasn't.

The flexi furlough scheme they introduced half way through would have been a nice help, but of course that was only offered to those who'd already benefitted from the full furlough. So annoying.

[dsc]

Yes, one third of the two thirds you're not working, so 22.22 recurring percent.

So it went from 80% furlough to 22% with this pile of wank and they are spinning it as an even better support plan?

[mattster]

Make it worthwhile for them to keep staff they want but they might not be able to afford.

Does it though?

[Lance]

It's a bag of tulipe isn't it? Really not worth bothering with. I can't see how this will prevent any firm from making the redundancies they were already planning on.

That’s entirely the point.
Don’t try and make employers retain staff they wouldn’t otherwise keep.
Make it worthwhile for them to keep staff they want but they might not be able to afford.

[mattster]

Could you not have taken advantage of the original furlough scheme?

It's hard to see how this new scheme is going to help many companies, who will effectively be paying over 150% of normal wages for the same hours if they take it up - presumably at a time when money is tight. Who is it actually for? No company with unskilled staff will pay for three people to work 33% of the time and pay out 55% salary for each, when they could just sack two and pay one full time - why would they? The only companies I can imagine using it are those with highly skilled staff that they don't want to lose, who anticipate a relatively swift return to better times and want to be able to hit the ground running without rehiring.

[ittony]

I only took a quick glance at the figures, so excuse the dumb question, but am I seeing it correctly that the gov max grant is 22%?

Yes, one third of the two thirds you're not working, so 22.22 recurring percent.

[ittony]

The wording of guidance on the HMRC website specifically says "we expect employers not to make this up to 100% out of their own funds" which is different to the CJRS where they encouraged employers to make it up to the 100% but did not force them

Oh. That makes it even less worth bothering with then. You've have to use the scheme for four months only then ramp up the salary in March to bring the average back up to £732 or whatever.

[dsc]

I only took a quick glance at the figures, so excuse the dumb question, but am I seeing it correctly that the gov max grant is 22%?

[oliverson]

It's a bag of tulipe isn't it? Really not worth bothering with. I can't see how this will prevent any firm from making the redundancies they were already planning on.

[oilboil]

I just look at how it works, and it looks very pitiful. From the gov:
Hours Employee Worked 33% 40% 50% 60% 70%
Hours Employee Not Working 67% 60% 50% 40% 30%
Employee Earnings (% of normal) 78% 80% 83% 87% 90%
Gov’t Grant (% of normal wages) 22% 20% 17% 13% 10%
Employer Cost (% normal wages) 55% 60% 67% 73% 80%

https://assets.publishing.service.go..._Factsheet.pdf


So how it works for us
So let's take a typical contrator PAYE salary at £792/month.
- Get the scheme with 33% of the time worked. So get £261/month from LTD
- Then for the hours not worked, the amount is up to £530 for which the gov pay 1/3 (£175) and your LTD pay 2/3 (£355).

So you end up with the LTD paying 78% of the wage £616 and the gov 22% at £175.

Really a small amount for the effort. Not sure that would prevent job being lost. In this scheme, people may work 1/3 of the time but the employer still has to pay 78% of the wage... and not NI deduction.


The amount is so low that not sure I'll take it, I'll ask them if that's something directors like us can get first. So that we don't get penalised for getting this tiny amount of cash.

You've got your figures wrong.

So how it works for us
So let's take a typical contrator PAYE salary at £792/month.
- Get the scheme with 33% of the time worked. So get £261/month from LTD
- Then for the hours not worked, the amount is up to £530 for which the gov pay 1/3 (£175) and your LTD pay 2/3 (£355).

So you end up with the LTD paying 78% of the wage £616 and the gov 22% at £175


You are correct about getting the £261 (1/3) from the limited as that is what you worked. (You could have worked more than 1/3 of the time in that case the figures differ but the proportiosn stay the same - the scheme only covers 66% of the wages unpaid)

The remaining 2/3rds is where you have it wrong...

The first 33% of the unpaid 2/3rds is paid by the limited
The second 33% of the unpaid 2/3rds is paid by HMRC
The last 33% fo the unpaid 2/3rds is incurred by the employee in lost wages

So in this case the LTD pays 55%, HMRC 22% and the employee loses 22%

The wording of guidance on the HMRC website specifically says "we expect employers not to make this up to 100% out of their own funds" which is different to the CJRS where they encouraged employers to make it up to the 100% but did not force them

[cwah]

So, finally today some support that limited company directors might actually be entitled to, after all this time.

One third of two thirds of your salary, assuming you're working one third of your full time hours, which for a £732 salary is £976 over the six months the scheme is due to run.

A bit pitiful compared with what many have been getting over the last six months, but better than nothing I suppose.

Anyone planning on claiming it?

I just look at how it works, and it looks very pitiful. From the gov:
Hours Employee Worked 33% 40% 50% 60% 70%
Hours Employee Not Working 67% 60% 50% 40% 30%
Employee Earnings (% of normal) 78% 80% 83% 87% 90%
Gov’t Grant (% of normal wages) 22% 20% 17% 13% 10%
Employer Cost (% normal wages) 55% 60% 67% 73% 80%

https://assets.publishing.service.go..._Factsheet.pdf


So how it works for us
So let's take a typical contrator PAYE salary at £792/month.
- Get the scheme with 33% of the time worked. So get £261/month from LTD
- Then for the hours not worked, the amount is up to £530 for which the gov pay 1/3 (£175) and your LTD pay 2/3 (£355).

So you end up with the LTD paying 78% of the wage £616 and the gov 22% at £175.

Really a small amount for the effort. Not sure that would prevent job being lost. In this scheme, people may work 1/3 of the time but the employer still has to pay 78% of the wage... and not NI deduction.


The amount is so low that not sure I'll take it, I'll ask them if that's something directors like us can get first. So that we don't get penalised for getting this tiny amount of cash.

[cwah]

I'd be interested as well. Not sure how we could qualify because we'd supposedly be working 1/3rd of the time?

[SussexSeagull]

If I qualify then yes.