Latest COVID-19 support for self employed!
It was announced by the Rishi Sunak the Government will be launching a new grant scheme to support self-employed workers.
All self-employed workers will be eligible for a taxable grant worth 80% of their average monthly profits over the last three years; up to £2,500 a month. This is in line to the offer to employers furloughing staff.
This will cover 95% of those who make the majority of their income from self-employment and will be available for three months – although the Chancellor will look to extend it if necessary.
Who can apply?
You can apply if you’re a self-employed individual or a member of a partnership and you:
Have submitted your Income Tax Self-Assessment tax return for the tax year 2018-19
Traded in the tax year 2019-20
Are trading when you apply, or would be except for COVID-19
Intend to continue to trade in the tax year 2020-21
Have lost trading/partnership trading profits due to COVID-19
Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. This is determined by at least one of the following conditions being true:
Having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
Having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period
If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.
How do you access it?
Individuals should not contact HMRC now. HMRC will use existing information to check potential eligibility and invite applications once the scheme is operational. HMRC will then pay the grant directly to eligible claimants’ bank account. HMRC is urgently working to deliver the scheme; grants are expected to start to be paid out by beginning of June 2020. For eligible individuals who have not submitted their returns for 2018-19, they will have 4 weeks’ notice from the date of the announcement to file their returns and therefore become eligible for this scheme.
HMRC are publishing guidance on the scheme here. This guidance will continue to be updated.
In summary, the options on offer to self-employment individuals are:
A taxable grant worth up to 80% of their monthly profits over the last years.
Business Interruption Loans
Deferring self-assessment papers
Universal Credit can be accessed in full
Self-employed individuals who live in the social rented sector can receive welfare support.
For information on all the options follow this link
We will keep you informed as updates happen. Be safe!