CORONAVIRUS SELF-EMPLOYMENT INCOME SUPPORT SCHEME
The Chancellor, Rishi Sunak, announced the Coronavirus Self-Employment Income Support Scheme on 26 March, 2020. The scheme will provide direct cash grants of 80% of average monthly self-employed profits over the last three years, up to a maximum of £2,500 per month.
The scheme is 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. In addition, more than half of overall income in these periods must have come from self-employed income. Therefore if you are both employed and self-employed then be aware of this restriction.
The Government believes that this covers 95% of people who receive the majority of their income from self-employment.
The grant will be payable for at least 3 months from March to May, but won’t be paid into bank accounts until early June at the earliest. The payment will be taxable and should be included on your tax return.
Those eligible will be able to apply directly to HMRC using a simple online form, although this will not be available for some time and in the meantime, you are urged not to contact HMRC. They will get in touch with eligible taxpayers using existing information to invite applications once the scheme is operational.
Those who pay themselves a salary and dividends through their own limited company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.
Whilst this scheme appears to be good news for most sole traders, and partners in partnerships, there appears to be little support available for contractors and owners of small limited companies.
If you believe that you may be eligible for the Coronavirus Self-Employment Income Support Scheme and require our assistance with making an application then please contact us by email on email@example.com