Chancellor Rishi Sunak has set out his Winter Economy Plan, aimed to divert a jobs crisis amid continuing COVID-19 restrictions.
NFU President Minette Batters said: “In what has been a turbulent and uncertain year, the Chancellor’s plan will be welcomed by farm businesses.
“The NFU has consistently urged the Treasury to extend the CBIL and ‘Bounce Back’ loan repayment term to ten years and this will make this scheme more viable for our members. The initial lump sum covering three months’ profits for those eligible for Self-Assessed Income Tax and the ‘Pay as you Grow’ scheme to help businesses repay their Bounce Back loans will also prove to be helpful.
“I am hopeful that our members will benefit from the initiatives announced and that further support for the self-employed will succeed in supporting cash flow during this difficult time. The NFU will monitor the government’s targeted approach to supporting businesses and continue to assess the impact of this pandemic on our members.”
What the Winter Economy Plan includes:
The government has introduced a new ‘pay as you grow’ scheme to provide businesses with more time and greater flexibility to repay their Bounce Back loans:
1. The loans will be extended from six to 10 years, nearly halving the average monthly repayments.
2. Businesses who are struggling can now choose to make interest only payments and any business that is really in trouble can apply to suspend repayments altogether for up to 6 months.
3. No business taking pay as you grow will see their credit rating affected as a result. The government guarantee on these loans will be extended for up to 10 years allowing businesses again more time to repay.
4. He also announced that for all the loan schemes the deadline will be extended until 30 November 2020.
And those currently eligible for the Self-Employment Income Support Scheme (SEISS) and are continuing to trade but face reduced demand due to coronavirus can apply for an initial lump sum covering three months’ profits for November until the end of January 2021.
This is worth 20% of average monthly profits up to a total of £1,875. An additional second SEISS grant will be available for self-employed individuals to cover February 2021 – end of April 2021.
In addition, Self-Assessed Income Tax payers will be given time to pay. This means that payments deferred from July 2020 and those with bills due in January 2021 will now be able to pay over 12 months until January 2022.
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