The Chancellor has revealed the long-awaited support package for self-employed workers that have seen their income hit by the coronavirus pandemic.
The scheme, similar to that the one available to employees, provides a grant worth 80% of profits up to a cap of £2,500 per month. This scheme is targeted directly at sole traders and partners of trading partnership with earnings averaging less than £50,000 over the previous three years.
Payments of up to £7,500 are planned to be made by HM Revenue & Customs in June. We are still unsure at how the self-employed will be assessed, as the scheme is only available to those who have had their income impacted by COVID-19.
It is important to note that currently, this scheme is not available for owners of limited companies who pay themselves a salary and/or dividends. They may, however, be covered for their salary via the Coronavirus Job Retention Scheme if they are operating a PAYE scheme.
The Self-Employment Income Support Scheme – Key Details:
- Support for self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19.
- The scheme will provide a grant to self-employed individuals or partnerships, worth 80% of their profits up to a cap of £2,500.
- HMRC will use the average profits from tax returns in 2016-17, 2017-18 and 2018-19 in order to calculate the size of the grant.
- Profits must be less than £50,000 to be eligible.
- The scheme will be open for an initial three months.
- First claims are available to be made at the beginning of June.
Extension to file your 2018-19 Tax Return:
The scheme being available from June has been set in place to allow late filers the ability to get up to date with their tax returns. This must be done in order to be available for the scheme, this is something our experienced team of accountants can help you with so that you do not miss the deadline. Click here to get in contact with us.
How to access the scheme:
HMRC will contact all eligible self-employed workers, you should not contact them.