Chancellor Rishi Sunak has unveiled a new 'Job Support Scheme' for millions of workers, as new six month restrictions come into force across England.
The scheme will offer targeted support for those who are unable to return to work full time from November when furlough closes.
Sunak warned that while the Treasury won't be able to protect "all jobs and businesses", it will offer a lifeline to those that are struggling.
He said the new scheme will focus on "viable jobs" as opposed to roles that only exist because the government is continuing to subsidise wages.
Alongside new measures, Sunak today announced an extension of the self-employed grant, adding that small businesses will now have longer to repay their bounce back loans.
So how will these measures affect you?
Speaking on Thursday night's Martin Lewis Money Show, the consumer expert explained exactly how the Chancellor's new measures will come into force.
The new furlough
"It's too complicated," Martin said, addressing one viewer's concerns about how the new part-time working scheme will impact his role.
"Essentially, the Job Support Scheme will be a replacement of furlough," Martin explained.
"It's available to all firms, but larger companies will have to prove they need the financial support. Employers will also be able to apply for it even if they haven't used furlough in the past.
"It's available to any employee that's been on their employer's PAYE payroll since September 23," he added.
Through the scheme, you must work a minimum of a third of your normal hours.
"This will be paid by your employer at a normal rate," Martin explained.
"The rest of your normal hours that you are not working will effectively be split three ways.
"Your employer pays a third, you pay a third (in the form of unpaid wages), and then the government tops it up by a third.
"Your employer will still have to pay national insurance and pension contributions on your behalf."
The state's contribution will be capped at £698 a month.
So how much will I get?
- If you work 33% of your normal hours, your employer will pay 56%, the state will pay 22% and you'll get 78% of your normal income at the end of the month.
- If you work 50% of your normal hours, your employer will pay 67%, the state will pay 17% and you'll get 83% of your normal income at the end of the month.
- If you work 70% of your normal hours, your employer will pay 80%, the state will pay 10% and you'll get 90% of your normal income at the end of the month.
What about the self-employed income support grant?
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"The Chancellor has extended the Treasury's grants for self-employed workers," Martin explained.
"The next grant (the third so far), will be for those whose income is affected between November 1 and January 31 2021.
"This will be a one off 20% for three months, capped at £1,875.
"Eligibility will remain the same, meaning it will only be for those with a maximum take-home profit of £50,000 and who filed a tax return in April 2019.
"The next grant will be for those affected between February 1 and April 30 2021.
"There are no details yet, which could be because the government wants to keep its options open to support those who may have been left out of support before."
Are there any changes to the small business bounce back loans?
"Yes, there have been a few tweaks for small business owners," Martin added.
"New loans can now be repaid over 10 years instead of six.
"You can apply for one six month payment holiday or three six month interest-only payment periods.
"Either way, your credit file will not be affected," he added.
Will I still have to file my next self-assessment?
"No, you'll be able to spread January 2021's self-assessment across the year.
"This includes tax payments that were deferred on July 20 this year. No tax will be added," he concluded.
