Self-Employed Income Support Scheme
Chancellor Rishi Sunak announced the heavily anticipated ‘Self-Employed Income Support Scheme’ to those affected by the impact of COVID-19. The scheme itself largely echoes the support provided to employees on the 20 March 2020. We’ve detailed the key points below.
The new grant is available to self-employed individuals or members of a partnership that meet the following criteria:
- Have submitted an Income Tax Self Assessment tax return for the tax year 18/19 and traded in tax year 19/20
- Would be trading currently, if it wasn’t for the COVID-19 pandemic
- Intend to continue trading in 20/21 tax year
- Have lost trading/partnership profits due to the COVID-19 pandemic
- Majority of earnings (over half of your income) must come from self-employment
- Having trading profits of up to £50,000, averaged over the last 3 years (less than 3 years if they don’t have that history)
If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020 to allow HMRC to assess your eligibility.
You will not be eligible if you have only recently become self-employed, i.e. commenced after 6 April.
What you’ll be entitled to if you meet the above criteria:
- You will receive a taxable grant of 80% of the average profits from the tax years applicable
- Up to a maximum of £2,500 per month, the same limit as furlough workers through the Coronavirus Job Retention Scheme
- This will run for the next three months and may be extended, if needed
- It will also be backdated to the 1 March 2020
- Grants will be paid in one lump sum covering all three months, will start to be paid by HMRC at the beginning of June.
How eligible individuals apply:
- You cannot apply for this scheme yet. HMRC will contact you if you are eligible and invite you to apply online.
- You do not need to contact them before they do so as they are urgently working to get things up and running.
For more information, or for support, please get in touch with your usual Taxpert. You can find our up to date contact details on Our People page.