Chancellor’s summer budget – what it means for you

This afternoon the Chancellor has announced a range of policies designed to create jobs and stimulate vulnerable sectors of the economy, as the country begins to move forwards after three months of lockdown. Numbers suggest that the economy contracted by 25% in the last few months, and there are predictions of significant future job cuts. The Chancellor has also announced an Autumn budget later this year.

The following is a summary of the main points

If you have any questions about what these changes may mean for you and your business, please do get in touch with your Swindells Partner.

The budget focuses on three main areas:

• Job creation incentives for young people, career coaching and advice
• Housing market stimulus
• Active help for the hospitality and leisure sector

Key budget announcements overview

Job creation incentives for young people, career coaching and advice

The Chancellor has insisted that the furlough scheme will not be extended past its current end date in October.  Instead he has announced a range of measures intended to create jobs for the young, those in career advisory industries and those in the ‘green’ sector.

Rewarding employers who bring back furloughed staff

If a business brings back someone who was furloughed, and employs them through to January 2021, the government will pay a Job Retention Bonus of £1,000 per person.

Kickstart scheme

The Kickstart scheme will pay employers directly, to create new jobs for any 16-24 year old at risk of long term unemployment. The government will pay young people’s wages for six months, as well as an additional amount to cover overheads. For a business employing a 24 year old, the grant will be around £6,500.

Traineeships

The government will pay employers £1,000 to take on trainees, with triple the number of places available. Traineeships consist of work experience placements, training (including English and maths) and work preparation for 16-24 year olds. The placements last from 6 weeks to 6 months depending on need and can lead to apprenticeships, further education and other employment.

Funding the recruitment of careers advisers

An additional £32m worth of investment to enable the recruitment of career advisers and provide bespoke advice and careers guidance has been announced  for over a quarter of a million more people.

Government payment to hire young apprentices

For the next six months, the government will pay businesses to hire young apprentices, with a payment of £2,000. The government is also introducing a new bonus to hire apprentices aged 25 and over, with a payment of £1,500.

Housing market

Green home improvement grants

Homeowners will receive vouchers to pay for at least two thirds of ‘green’ improvements such as loft, wall and floor insulation.  Low income households will be eligible for up to 100% government funding up to a limit of £10,000. The Chancellor has suggested that this scheme could support 100,000 jobs and make over 650,000 homes more energy efficient. It could also save households up to £300 a year on their bills.

Six month Stamp Duty Land Tax cuts

The government has increased the threshold for the payment of stamp duty land tax to £500,000. Anyone buying a main home under £500,000 will pay no stamp duty at all. It takes effect today until March 31st 2021.

Tourism and hospitality sectors

VAT rate reduced to 5%

The VAT on goods and services supplied by the tourism and hospitality industry has been reduced to 5% for the next 6 months

Eat out to help out voucher 

In order to support restaurants and the people who work in them, the government has announced that it will fund a 50% reduction in bills for eating out of up to £10 per head, on sit down meals and non alcoholic drinks, Mondays to Wednesdays at participating premises. Businesses will have to sign up to the scheme online and this should be live next week.

If you have any questions about what these changes may mean for you and your business, please do get in touch with your Swindells partner using the details on our contact page.