Martin Lewis Releases New Tips on Vacation Payments, Bounce Back Loans, and Self-Employed Payment Dates
As the lockdown continues to challenge Scotland’s health and economy, Martin Lewis has released new advice on how to navigate this difficult financial situation.
In the latest edition of his weekly newsletter, the founder of MoneySavingExpert.com included updates on getting cash refunds for vacations – and who to report to if you don’t, support payments at self-employment income, reduced student loan repayments and the insurance payment holiday proposal.
“Finally this week, there is some hope for some who have fallen through the cracks. While far from ideal, it’s a way to use the new Bounce Back loan program to support yourself, ”Martin wrote.
The UK government’s Small Business Bounce Back Loan Program can be used by the self-employed to support their income if they have no other support.
100% State Backed Bounce Back Loans of up to £ 50,000 are available as of Monday May 4th. They’re interest-free and payment-free the first year – so pay them back then and it’s not a cost, and at a very low 2.5 percent annual interest rate thereafter.
Martin said: “We have now officially CONFIRMED that the lending rules do not prevent you from using these loans to support your income (although there may be tax / regulatory issues depending on your business structure) . Of course, this is far from ideal – these are loans, not grants – but it is an option.
Here are Martin Lewis’ latest “needs to know”
Competition and Markets Authority says companies must offer cash refunds for cancellations
You can now report companies that don’t. The Competition and Markets Authority (CMA) says it has been inundated with complaints from consumers who are being rejected for reimbursement after coronavirus cancellations.
It indicates that whatever the contract, you are generally reimbursed in full if:
No goods or services were provided
The company cannot provide the service due to the lockdown
You cannot use the service due to the lockdown
The CMA is investigating all sectors, but will start with:
The CMA plans to talk to the companies first and then consider enforcement action if they still don’t comply. You can report companies directly for review.
You can see how to report companies and watch Martin interview a CMA boss where they explain exactly what your rights are here.
Self-Employed Income Support Payments Are Coming Faster
The Self-Employed Income Support Program will pay 80% of the profits, up to £ 2,500 per month, to eligible people.
Martin said: “HMRC contact will begin this week via letter, SMS and email with the opening of applications on Wednesday May 13th.
“Payments to reach accounts six business days after request, so first payments would be May 21.”
“Payment is currently scheduled to cover the months of March, April and May – three months of payment.”
If you want to know your application appointment date now, you don’t need to, but HMRC has an online eligibility tool for the program.
If you go there, you will then be randomly assigned a date of May 13-18.
ISA Lifetime Withdrawal Penalty (LISA) has been removed for one year
The financial reporter advises that “all first-time homebuyers between the ages of 18 and 39 should consider saving at a top LISA because the state adds an unbeatable 25% to your first qualifying home – so put the maximum of £ 4000 per year into and get £ 1000 per year added for free. “
Just be aware that if you are withdrawing the money for any reason other than buying a qualifying home or once you are 60 and over, you will actually have to pay a penalty of 6.25%.
To help people access funds during the coronavirus, this has now been removed until April 5, 2021 and backdated to March 6, 2020 (i.e. if you’ve since done so, you get back the money). ‘money).
Martin explains how the penalty works: “LISA’s standard withdrawal fee is 25%. So put in £ 1,000, you get the 25% bonus = £ 1,250. Take it out and 25% has been taken = £ 937.50, a loss of 6.25%.
“Now the withdrawal fee is only 20%. So put in £ 1,000 and you have £ 1,250. Withdraw it and 20% is withdrawn = the £ 1000 you put in.
“Those who already have a Help to Buy ISA, the predecessor of LISA, have never paid a penalty anyway, so there is no change in that. “
Student loan repayments decline as threshold increases
“While nothing has structurally changed, how all student loans (after 1998) work means you pay less if your income goes down and this was just boosted by the annual threshold increase in April,” wrote Martin.
Plan 1: (All Scottish starters 1998-2012)
- You are now starting to repay annual income over £ 19,390 (down from £ 18,935)
College graduates repay 9 percent of income above these thresholds, so the increase means that if your salary hasn’t increased, you pay less.
If you have been placed on leave or your salary has been reduced, the deduction will automatically adjust accordingly.
Insurance payment holidays
Car, home, travel, boiler, life, private medical and more are all available upon request.
The city’s regulator, the Financial Conduct Authority (FCA), has announced proposals, which are expected to be in place by Wednesday, May 13, which means people can get the following:
Payment holidays of 1 to 3 months on request. This is for those who pay monthly insurance and are struggling with the coronavirus. Since most monthly insurance payments are in fact loans, interest continues to accrue, so only do this if it is really necessary.
Waiver of Cancellation Fees for These End Policies
Re-evaluate policies upon request to ensure they are appropriate. For example, if your car’s mileage has dropped significantly – and they shouldn’t charge a fee if you change
Remove “unnecessary” extras on request. For example, if you want to drop off your “key cover” because you are not driving, this should be allowed for free.
Deadlines for payment holidays
If your finances are getting worse and you are wondering if you want to take a payment holiday, don’t panic. Here are the latest application deadlines for key schemes:
Until June 20 at least: Mortgage payment holidays
Through July 9: Credit and store cards, personal loans, and catalog debt
Until July 27: Auto finance (PCP, leasing, HP), pawn shop, buy it now and pay late and lease with option to buy, payday loans (interest and payment freeze)
Until August 13 (to be confirmed by FCA): Insurance – car, home, loan repayment
Until October 20: Individual voluntary provisions
You can also request an overdraft of up to £ 500 at 0% from your bank or mortgage company.
Unblocking the Universal Credit System – if you haven’t applied, now is the time
The universal credit system had peaked at 48,000 applications in a single day, or 10 times the normal demand.
Figures from a week ago show apps are down to 32,000, which should mean things run smoother and faster.
If you are having difficulty due to your lower income, it is worth checking – you may be eligible for universal credit even if you get other aids, such as self-employed leave or income assistance. These will simply be counted as income when they determine how much you could get.
The Martin Lewis Money Show coronavirus live special is on STV at 8 p.m. Thursday. You can sign up for the MoneySavingExpert.com newsletter here.
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