26 March: Support for self-employed people

 

Having been under pressure for the past week, Chancellor Rishi Sunak has announced measures to support self-employed people whose earnings have been affected by the coronavirus outbreak.

Self-employed income support scheme (SEISS)

  • Those who are already self-employed and facing financial difficulties are asked to apply.
  • The scheme will cover up to 80% of average profits over the past three years, up to £2,500 per month, for at least three months.
  • Those with trading profits of more than £50,000 are not eligible.
  • Eligibility is determined with reference to earnings in 2018/19 as reported on tax returns filed this year.
  • What next? Application will be to HMRC via an online platform, yet to launch. The grants probably won’t be available until June 2020, backdated to 1 March. In the meantime, self-employed people who can’t work are expected to claim universal credit, access to which was broadened in the Spring Budget.

A frequently asked question has been “What about the directors of single-person limited companies?” The guidance says: “If you’re a director of your own company and paid through PAYE you may be able to get support using the Job Retention Scheme.” That suggests anyone drawing the majority of money from their business in the form of dividends will miss out on support.

Author Name: 
Siobhan