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New Self-Employed Financial Support Announced By The Government

The Chancellor announced support for self-employed individuals yesterday evening (26th March) confirming what we already knew, self-employed people are a crucial part of the UK’s workforce. This covers 95% of people who receive the majority of their income from self-employment. The Chancellor states “this gives the self-employed the same level of support as those in work.”

What does it mean to you?

  • direct cash grant of 80% of their profits, up to £2,500 per month
  • latest announcement in an unprecedented package of government support to protect businesses and individuals
  • for at least 3 months

Eligibility

  • worth 80% of their average monthly trading profit over the last three years
  • the scheme will be 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
  • to qualify, more than half of their income in these periods must come from self-employment
  • to minimise fraud, only those who are already in self-employment and meet the above conditions will be eligible to apply
  • You are not eligible if you pay yourself with a salary and dividends, if you operate PAYE scheme you are covered through Coronavirus Job Retention Scheme

  How Can You Apply?

  • application will be through a simple* online form with the cash being paid directly in to your bank account.
  • HMRC will identify eligible taxpayers and contact them directly with guidance on how to apply
  • the word simple has been used by the Chancellor, not us!

When Will The Money Be Paid?

  • payments will start at the beginning of June
  • grants will be paid in a single lump sum instalment covering all 3 months

Everything Else

  • individuals should not contact HMRC now. HMRC will use existing information to check potential eligibility and invite applications once the scheme is operational.
  • there is alternative support to boost household incomes which will be accessible while the new scheme is being rolled out including:
    • £7 billion boost to Universal Credit
    • income tax and VAT deferrals
    • £1 billion more support for renters
    • access to three-month mortgage holidays
    • business continuity loans

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.



 

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