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Coronavirus and your finances: what help can you get in the second lockdown?

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Written by: Emma Lunn
18/11/2020
News and updates on everything to do with coronavirus and your personal finances.

The coronavirus outbreak has understandably left many people worried about their finances and anxious about what will happen to their jobs, mortgages and general household bills.

To help you understand your rights and what financial assistance is out there for you, we’ve put together this guide linking you to all the latest news.

We’ll be updating this page regularly as the situation changes and new announcements are made.

Homes

A six-month moratorium on housing possession proceedings ended in September. But new rules since then mean that bailiffs can’t enter homes to carry out eviction proceedings until after 11 January 2021.

The main exception to this is if a tenant has built up nine months or more of rent arrears before 23 March 2020. Any rent arrears accrued since then would be disregarded. Tenants can also still be evicted for anti-social behaviour.

Landlords also need to give tenants more notice than previously if they want them to move out. In England, Wales and Scotland, they usually now need to give six months’ notice, and 12 weeks’ notice in Northern Ireland.

Mortgage lenders will allow borrowers who are concerned about being able to meet their mortgage repayments to take up to six months of payment holidays. Mortgage holders have until 31 March 2021 to apply for a payment holiday. After that date, they will be able to extend existing deferrals to 31 July 2021, provided these extensions cover consecutive payments.

Payment holidays are also open to landlords whose tenants have been financially affected by coronavirus. Click here for more.

A number of credit reference agencies have confirmed that consumer credit scores will be protected when people have agreed ‘payment holidays’ in place as a result of the Covid-19 pandemic.

The government has published a guide to help support and encourage landlords to take a ‘common sense’ approach to tackling housing issues such as a leaking roof, a broken boiler or a plumbing issue that leaves the tenant without washing or toilet facilities or faulty or broken appliances.

Jobs and wages

The original Coronavirus Job Retention Scheme (CJRS), or furlough scheme, launched in March to prevent mass layoffs during the first lockdown was due to end in October after gradually being wound down.

However, chancellor Rishi Sunak has announced that furlough will now run until the end of March 2021. It will provide 80% of wages for hours not worked, up to a cap of £2,500 a month.

To be eligible, employees must have been on an employer’s PAYE payroll on 23:59 on Friday 30 October.

Furloughed employees can be brought back to work on a part-time basis or full-time basis.

The Jobs Support Scheme was due to start on 1 November but was scrapped before it even begun, when furlough was extended.

To help self-employed workers, the government has announced the Self-employment Income Support Scheme (SEISS) will be extended from November.

Self-employed workers have already been able to claim two grants. The first, available from April, was a taxable grant worth 80% of average monthly profits based on the last three years of tax returns, up to a maximum of £2,500 a month.

The second grant became available from August, and worth 70% of people’s average monthly trading profits, capped at £6,570 in total.

After altering the amount self-employed workers could claim several times, the government eventually decided the third SEISS grant, covering November to January, will be equivalent to 80% of normal trading profits, capped at £7,500 for the quarter.

There will be a fourth SEISS grant covering February 2021 to April 2021, but we don’t know how much it will be yet.

Utility bills

The government and energy industry have agreed a package of measures to ensure the most vulnerable people remain supplied with gas and electricity during the coronavirus pandemic. Measures include pausing debt and bill payments. Click here for more.

Bill payers should check whether they are owed money from their energy supplier as the average amount is £100.

With millions of people forced to work from home due to coronavirus, you may be able to claim up to £6 a week for the additional expense of heating and electricity as a result.

Vodafone has introduced a £10 a month mobile deal for jobseekers, while Virgin Media has introduced a £15 a month broadband Essentials package for Universal Credit claimants.

Car finance

The Financial Conduct Authority (FCA) said in April that firms will offer a three-month payment holiday for those struggling with car finance agreements during the coronavirus crisis.

In July it announced that this would be extended for a further three months.

Firms shouldn’t look to end agreements or repossess the vehicle where a customer experiences temporary financial difficulty  and they mustn’t change customer contracts in a way that is ‘unfair’.

Overdrafts and loans

The FCA has set out various measures which apply to banks, building societies and credit providers regarding consumer credit products.

Borrowers can ask for a payment freeze of up to three months on loans, including guarantor loans, logbook loans and home collected credit, and credit cards. Alternatively, customers will be able to pay a token amount.

In September the FCA asked lenders to provide tailored support to customers still struggling to pay credit cards, loans, overdrafts and other consumer credit products after a payment break.

Borrowers can request a £500 interest-free overdraft on their current account. Banks had to offer this to all customers at the outbreak of the pandemic, but now they only have to offer it to customers who request it.

Firms are also obliged to ensure overdraft customers are no worse off on price than before recent overdraft changes came into force.

Train tickets

Rail passengers with advanced or season tickets will get a full refund. Contact either your train company or independent ticket retailer – wherever you bought your ticket originally. Click here for more.

Monthly subscriptions

All live sports events were on hold in March and Sky Sports allowed customers to pause their subscription. BT Sport customers could apply for one-month’s credit back or donate the cost of one month’s subscription to support NHS workers.

But sports subscriptions were re-started in June when the Premier League returned.

Driving and MOTs

Drivers can continue to use their vehicles even if their MOT has expired. Car, motorbike and van drivers were given a six-month MOT exemption (from 30 March) so they can carry out essential journeys such as to work (frontline staff/key workers), shops to buy food or to help a vulnerable person.

But mandatory MOT testing was re-introduced in August.

Annual tests for heavy goods vehicles such as lorries, buses and trailers were also suspended for up to three months on 21 March. Click here for more.

The Association of British Insurers has cleared up some confusion about which car journeys are covered during lockdown. The trade body says both non-essential travel and commuting to work, even if your policy doesn’t normally cover commuting, will be covered by car insurance.

Child Benefit

Thousands of parents who had previously opted out of claiming child benefit to avoid a tax charge may be able to receive £100s from the government after losing income due to coronavirus.

Parents of newborn babies can still claim child benefit even if they haven’t been able to register their child’s birth because of the coronavirus outbreak.

Sick pay

If you are off work because you have to self-isolate, you should be eligible for statutory sick pay (SSP). The government has introduced emergency measures which mean you’ll get SSP from the first day you are off work, rather than the fourth. Click here for more.

Grant fund

Charity Turn2us launched a one-off £500 coronavirus grant fund to help those facing financial hardship due to the global pandemic. It was suspended after just a couple of days due to ‘unprecedented demand’.

However, it will re-open again once it has processed the backlog of applications.

Holidays

The Foreign and Commonwealth Office (FCO) extended its warning against all but essential international travel for an indefinite period in March. See our travel refund guide for more information.

Since then travel started to open up over the summer. However, holidays abroad are banned as part of the second lockdown. Read about your rights here.

Gift card and vouchers

If you have a voucher or gift card you’re unable to use or a firm is offering credit instead of cash for a cancelled or postponed good or service, you don’t have to accept it. Consumers are entitled to their money back. See here for more on your consumer rights.

Self-isolation grant

As part of the government’s package to ‘support and enforce self-solation’, people required to self-isolate from 28 September may be eligible for a £500 payment if they are in receipt of certain benefits and are unable to work. The scheme is administered by local authorities.

Anyone breaching self-isolation rules, or other coronavirus laws, could face a £1,000 fine, rising to up to £10,000 for repeat offences.

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