Chancellor gives financial support to the self-employed affected by coronavirus
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Update: June 2020 This service has now been extended for a further three months (June – August inclusive). See our insight Chancellor extends Self-Employment Income Support Scheme to August for further details. |
Under pressure to do something for the five million of self-employed individuals, the Chancellor announced today they will receive direct cash grants though a new scheme to help them during the coronavirus outbreak. Rishi Sunak has set out plans that will see the self-employed receive up to £2,500 a month in grants for at least three months potentially backdated to 1 March.
The new Self-Employed Income Support Scheme, will see those eligible receiving a cash grant worth 80% of their average monthly trading profit over the last three years. This covers 95% of people who receive the majority of their income from self-employment.
Plumbers, electricians, hairdressers and many other self-employed people who are eligible for the new scheme will be able to apply directly to HMRC for the taxable grant, using a simple online form, with the cash being paid directly into bank accounts. To minimise fraud, HMRC will identify eligible taxpayers and contact them directly with guidance on how to apply.The scheme will only be open to those with a trading profit of less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19. The Chancellor states that 95% of the self employed will be potentially eligible for the scheme. The scheme will only be open to those who can have filed a 2018-19 self-assessment tax return though late filers will also be let in if they file quickly.
This scheme has been designed at pace and there will be gaps and imperfections however, if it can be brought to fruition it can potentially help many individuals who find themselves unable to work. The first payments are estimated to be made ‘no later than June’ which will seem a long way off for those operating on tight personal cashflow.
What funding support could you be eligible for?
This flowchart is designed to point you in the right direction of what measures might be available for you based on what we know at present.
As more measures are introduced and more detail becomes available, this tool will be updated on a real time basis.
