Yesterday, you’re likely to have seen that the government announced their eagerly-awaited income support package for the self-employed.
Up until this point, there had been little talk about how the self-employed were to be helped out other than through some helpful if not a little underwhelming tax-deferrals. These policies paled into insignificance when compared with the unprecedented, highly-commendable promise the government gave to the ‘employed’ workers last week, whereby 80% of wages up to a maximum of £2,500 per month are to be guaranteed.
The government has understandably had its hands full recently, however a lot of self-employed workers, many having seen their income completely disappear, were left wondering ‘what about me’?
While some will argue that it isn’t perfect, namely the recently self-employed, Rishi Sunak’s announcement yesterday will therefore come as a huge, huge relief for a significant portion of the five million Brits who do work for themselves. For many, it will mean no longer having to apply for support via the already-stretched Universal Credit system.
The key policies that make up the ‘Self-Employment Income Support Scheme’ (or, SEISS), are as follows:
- The scheme will grant to self-employed individuals and partnerships, worth 80% of their profits up to a maximum of £2,500 per month
- HMRC will use the average profits from tax returns filed in the 2016/17, 2017/18 and 2018/19 tax years;
- The scheme will be open to those where the majority of their income comes from self-employment and who have profits of less than £50,000 per annum;
- The scheme will be open for an initial three months, with people being able to make the first claims from the beginning of June.
To be eligible for the scheme, you must meet all the following criteria:
- Be self-employed or a member of a partnership;
- Have lost trading / partnership-trading profits due to COVID-19;
- File a tax-return for the 2018/19 tax year as self-employed or a member of a trading partnership (those who have not already will be given an additional four weeks to do so);
- Have traded in 2019/20, currently still trading (or would be except for COVID-19), and intend to continue trading in the 2020/21 tax year;
- Have trading profits of less than £50,000 with more than half of your total income coming from self-employment.
If you’re self-employed and meet the above criteria, you don’t need to worry about contacting anyone or applying for the grant. HMRC is working hard to roll this scheme out and will contact you directly if their systems identify you as eligible. You will have to wait until the beginning of June at the very least though, with the government confirming this is when they expect the first grant payments to reach those in need, however this is expected to be three months worth of income support in one go.
We’ll be keeping you posted with all the relevant government policy announcements as and when they happen, so be sure to keep an eye on our socials for further updates. For the official updates though, here’s the link: https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme
And finally, as ever, if you’re thinking now would be a great time to talk to someone about getting your finances in order, look no further. We’ve got the technology and processes in place to ensure our Advisers are able to continue accepting new enquiries, so get in touch today to arrange your no-obligation initial meeting.
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