After weeks of speculation, this weekend we heard more indicative news that the Stamp Duty holiday, which saves buyers up to £15,000 on every UK property purchase, is likely to be extended for a further six weeks.
Let's consider how this is likely to impact the property market and look at other funding and economic stimulus packages to get the latest updates.
Anticipated Stamp Duty Holiday Extension
With the original deadline of 31st March 2021 fast approaching, this potential six-week extension may be a lifesaver for investors or homebuyers who have been desperately trying to complete their transactions ahead of the cut-off.
However, market reactions to this, as yet unconfirmed, news, are mixed.
While we aren't yet sure whether the new deadline will fall in mid-May, such an extension's brevity is unlikely to meet expectations for a much longer holiday period.
As it stands, Right Move estimates that as many as one in five buyers who had agreed on a home purchase back in July 2020 will still fail to hit the current 31st March end date.
Total property sales are up by 7% from last year, but enquiries are up 18%, relating to future purchases. So it seems that buyer demand will continue to outstrip market supply whether or not the holiday is extended for six weeks, or further.
Updates on Government Support Schemes for Businesses
Elsewhere, as 2021 continues apace, other deadlines are fast approaching:
· The Coronavirus Job Retention Scheme is due to end on 30th April 2021. This scheme covers up to 80% of employee wages up to a limit of £2,500 whilst they are on furlough. Monthly claims can continue as they are for the time being.
· Self-Employed Income Support Scheme claims are also open until April 2021. There is the possibility that changes to eligibility will be announced at the Chancellor's Budget speech scheduled for 3rd March. Currently, sole traders earning profits of less than £50,000 a year can claim quarterly grants for up to 80% of their profits, subject to a cap.
· Bounce Back Loans, the Business Interruption Loan Scheme and the Large Business Interruption Loan Scheme will end on 31st March 2021. If you haven't yet claimed, and plan to, now is the time to apply. Bounce Back Loans are available to self-employed people and small businesses.
· Local authority grants are still available. Grants are available of up to £3,000 per month for companies that have been forced to close. Businesses that are open but on a limited basis can claim up to £2,100 per month.
There are also one-off grants, to the value of £9,000, as announced on 5th January. All English businesses that have been forced to close can apply, and this is in addition to any other financial support programme.
The exact amount claimable depends on the rateable value of your business premises.
Job Retention Bonus Claims
If the furlough scheme ends in a few weeks, this will be dependent on lockdown restrictions lifting to the extent that most businesses can resume trade.
Despite the widespread vaccine rollout, we are yet to have any clarification about how this might happen.
However, one of the earlier support schemes offered may then be reinstated.
Initially, a taxable Job Retention Bonus accompanied the Job Retention Scheme. This payment is to the value of £1,000 per employee. It was due to be paid in February 2021 - but was suspended when furlough was further extended.
Current government guidelines state that this will now be paid after the Job Retention Scheme ends on 30th April.
Businesses must have:
- Submitted valid claims to the Job retention Scheme to apply.
- Continuously employed the staff until a cut off date (yet to be clarified).
The grant doesn't have to be paid to the employee. It is a taxable but non-repayable grant to the business.
Details have been sparse, so it seems possible that the government will scrap this bonus altogether.
As the picture of how the UK will emerge from this latest lockdown continues to become clearer, we'll keep you updated with forthcoming deadlines, any new financial support schemes or extensions as the news is released.
In the meantime, if you need help applying for any of the schemes mentioned here, or managing your bookkeeping and statutory filing requirements, do get in touch with the SAS team.