Claim a grant through the Self-employment Income Support Scheme.

  • Coronavirus: Statutory self-employment pay scheme

    Last Updated: 01 April 2020

     

    COVID-19 Statutory self-employment pay scheme.  The Chancellor announced the following new measures on 26 March 2020.

     

    Support for the self-employed during the coronavirus crisis:

     

    • A taxable grant of 80% of average monthly profits over the past three years.*
    • Capped at £2,500 per month.
    • Initially payable for 3 months.
    • Applies to self-employed individuals with trading profits up to £50,000 per year whose majority of income comes from being self-employed.

    *To work out the average HMRC will add together the total trading profit for the three tax years, or less, if you have been trading a shorter time and then divide by three or the number of months and use this to calculate a monthly amount.

     

    Note that:

     

    Qualifying conditions

     

    You:

     

    • Have submitted your Income Tax Self Assessment tax return for the tax year 2018-19 or you will submit your return by 23 April 2020.
    • Have 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.
    • You have lost trading/partnership trading profits due to COVID-19.
    • Your self-employed trading profits must also be less than £50,000.

    Additionally, more than half of your income comes from self-employment.

     

    One of the following conditions must be met:

     

    • Your trading profits/partnership trading profits in 2018-19 was less than £50,000. and these profits constitute more than half of your total taxable income
    • Your average trading profits in 2016-17, 2017-18, and 2018-19 are less than £50,000.

     

    In either case, the profits in 1. or 2. constitute more than half of your average taxable income in the same period.

     

    If you started trading between the years 2016 to 2019, HMRC will only use those years for which you filed a Self Assessment tax return.

     

    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.

     

    HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk-assess any late returns filed before the 23 April 2020 deadline in the usual way.

     

    • You must be registered as self-employed and have filed a 2019 tax return.
    • For those who missed the 31 January 2020 return deadline, there is now a four week period in which to file one.
    • The scheme is expected to commencing paying out in June 2020. The grant will be paid directly into your bank account, in one instalment.
    • HMRC will contact registered taxpayers, ask you to fill in a simple online form and the grant will be paid directly into your bank account.
    • The scheme may be extended if necessary.

    The comparable Employee Job Retention scheme for employees will apply to furloughed workers laid off during the crisis and has a cap of £2,500 per month.

     

    Additional support for small business

     

    • Employee job retention scheme: if you have other employees.
    • Grant funding: If you have a business premises.
    • Small business rate relief: If you have a business premises.
    • VAT payment deferral.
    • Emergency bank loans.

     

    See our COVID-19: Financial support Tracker

     

     

     

Coronavirus: Statutory self-employment pay scheme

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