Self-Employed and Freelance workers in the UK make uparound 5 million of the UK workforce, which in itself totals around the 28million people.
Inrecent weeks the self-employed in Britain have been patiently awaiting announcements, worried about how they will survive in these unprecedented times and seeking information on any self employment support allowance to be released for them.
On 26th March 2020 The Chancellorannounced therelease of new packages via the HMRCself-employment press releasewith measures to assist theself-employed and freelancers in the UK who are non-PAYE employees.
It is suggested that these packages will stand to assist around 95% of the 5 million self-employed and freelance workers in the UK.
So what is the Package?
The package is called the Self-Employed Income Support Scheme
People who are self-employed are eligible to receive up to£2,500 per month in grants for at least 3 months
Eligible candidates can receive a cash Grant worth 80% ofthe average monthly trading profit (not revenue) over the past 3 years. Theseamounts will be taxable.
If individuals do not have three years of accounts on recordat the HMRC then two and even one years accounts will be accepted in thesecases
Those individuals who have not yet submitted their accountsin January 2020 we will have an extension of a further months until the 30th ofApril 2020. This extension will be late penalty free allowing them to make thesubmission within this time.
Any individual who has not yet filed accounts or traded fora minimum of one year will unfortunately not be eligible for this scheme
Who qualifies forthis self-employed scheme?
The scheme above will be open to individuals with a tradingprofit of less than £50,000 in 2018-19 or or individuals with an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19.
To qualify more than half of an individual's income in theseperiods must come directly from Self-Employment.
Only those individuals who are already registered andtrading as Self-Employed and who meet the above conditions will be eligible toapply, this is in place to minimise fraud or false applications.
This scheme does also apply to individuals who are Membersof Partnerships
The income support scheme designed by HMRC from scratch willcover three months to May 2020.
Grants will be paid in a single lump sum in instalmentscovering all three months and this will start to be paid from the beginning ofJune 2020.
It is important to note that those who pay themselves asalary and dividends through their own company are not covered by the schemebut will be covered for their salary by the Corona Virus Job Retention Scheme,if they are operating PAYE schemes. However, this is not yet operational.
GOV.UK hasfurther details aboutwho is eligible for the schemeand how itwill work.
How do you access thescheme?
All self-employed individuals who are eligible for the newscheme will be able to apply directly to HMRC for the taxable Grant shortly.This will be done using a simple online form and the cash granted will be paiddirectly into the eligible candidates bank account.
If you are submitting late returns for your self assessment with HMRC, you need to do so now. Ifyou already submitted your return then you do not need to take any action.
Due to the scheme being administered by HMRC they will bethe ones to contact each individual and direct them to the relevant online formthat will need to be completed and submitted electronically. So it is importantto note that individuals DO NOT need to contact HMRC at this time.
HMRC will be using existing information on their records tocheck potential eligibility and to invite applications once the scheme isoperational and ready to go.
What if I have nomoney and June is too long to wait for the payment?
It is understood that for many people waiting until June fora payment will be too long a period to go without money. Understandably, noteveryone will have enough to tide them over until then.
In such cases the Chancellor has suggested that suchSelf-Employed individuals will still be able to access alternative availablegovernment support, including revised and more generous Universal Credit andsomething called the Coronavirus Business Interruption Loan Scheme (CBILS).
It is important to note that fees and interest on theseloans will be paid by the government for the first 12 months making themcompletely interest free for customers.
Applying for Universal Credit online has been simplified andcan be done by clicking here
Although standard Universal Credit payments would usuallybegin 5 weeks after application approval, individuals are now eligible toobtain an immediate cash advance, as soon as the initial application has beenaccepted.
What else has been released and how do you accessit?
Deferral of Self Assessment Income Tax paymentsdue in July 2020 and VAT payments due from 20 March 2020 until 30 June 2020
Increased amounts ofUniversal Credit
Directors of their own company paid through PAYE, may be able to get support using theJob Retention Scheme.
Need more Informationand Support?
HMRC Contact Number: 0300 200 3300
Further details and additional information about theself-employed scheme are to be shared by HMRC in due course. Please continue tocheck our blog and newsletters for daily updates buy book marking us on yourbrowser for quick and easy access:
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