The Chancellor announced his Budget yesterday, 3 March 2021. Whilst the tax and benefits measures announced in that Budget will apply to all the UK, the spending announcements will only apply in England. For spending, the Northern Ireland Executive is awarded a grant calculated on the basis of the Barnett formula that they can then decide how to use. The grant awarded to Northern Ireland in yesterday’s budget was £410 million.

• The Budget documents can be accessed here
• Alternatively, you can read a summary What you need to know
• NIBusinessInfo has also produced an excellent NI Business Budget Summary explaining how the Budget affects Northern Ireland businesses.

We have not provided a comprehensive summary below but highlighted a few key points.

Furlough

The headline fact, leaked on the evening before the Budget, was the extension of the Furlough Scheme until 30 September 2021.

All the Furlough Guides have now been updated to reflect this extension. See for example Check which employees you can furlough

The changes made to the Guides reflect the Scheme’s extension.  However, importantly they also provide for an extension to the cut-off date for eligibility. From 1 May 2021 anyone employed on 2 March 2021 can be furloughed.

The Guide states:

“For periods starting on or after 1 May 2021, you can claim for employees who were employed on 2 March 2021, as long as you have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 2 March 2021, notifying a payment of earnings for that employee. You do not need to have previously claimed for an employee before the 2 March 2021 to claim for periods from starting on or after 1 May 2021.”

 Businesses who created and started a PAYE payroll scheme on or before 2 March 2021 are also eligible for periods starting on or after 1 May 2021

HMRC has also published a new paper Changes to the CJRS Scheme from July 2021 setting out how the Scheme will work in July. The paper does not yet cover August and September 2021.

From 1 July 2021, the level of grant will be reduced each month and employers will be asked to contribute towards the cost of furloughed employees’ wages. These contributions are:

• July: 10% to the hours not worked in addition to the NICs and pension contributions
• August & September:  20% to the hours not worked in addition to the NICs and pension contributions

 

New information on claim periods from May 2021 has also been added to the sections ‘If your employee is on a fixed term contract’ and ‘Employee transfers under TUPE’

National Minimum Wage (NMW) and National Living Wage (NLW)

From 1 April 2021, the NMW will increase from £8.20 to £8.36 and the NLW will rise from £8.71 to £8.91.

Statutory Sick Pay (SSP)

Small and medium-sized employers in the UK will continue to be able to reclaim up to two weeks of eligible Statutory Sick Pay (SSP) costs per employee from the Government