Self-Employed and Freelance workers in the UK make up
around 5 million of the UK workforce, which in itself totals around the 28
million people.
In recent 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 Chancellor
announced the release of new packages via the HMRC self-employment press release with measures to assist the
self-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% of
the average monthly trading profit (not revenue) over the past 3 years. These
amounts will be taxable.
If individuals do not have three years of accounts on record
at the HMRC then two and even one years accounts will be accepted in these
cases
Those individuals who have not yet submitted their accounts
in January 2020 we will have an extension of a further months until the 30th of
April 2020. This extension will be late penalty free allowing them to make the
submission within this time.
Any individual who has not yet filed accounts or traded for
a minimum of one year will unfortunately not be eligible for this scheme
Who qualifies for
this self-employed scheme?
The scheme above will be open to individuals with a trading
profit 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 these
periods must come directly from Self-Employment.
Only those individuals who are already registered and
trading as Self-Employed and who meet the above conditions will be eligible to
apply, this is in place to minimise fraud or false applications.
This scheme does also apply to individuals who are Members
of Partnerships
The income support scheme designed by HMRC from scratch will
cover three months to May 2020.
Grants will be paid in a single lump sum in instalments
covering all three months and this will start to be paid from the beginning of
June 2020.
It is important to note that those who pay themselves a
salary and dividends through their own company are not covered by the scheme
but 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 has
further details about who is eligible for the scheme and how it
will work.
How do you access the
scheme?
All self-employed individuals who are eligible for the new
scheme 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 paid
directly into the eligible candidates bank account.
If you are submitting late returns for your self assessment with HMRC, you need to do so now. If
you already submitted your return then you do not need to take any action.
Due to the scheme being administered by HMRC they will be
the ones to contact each individual and direct them to the relevant online form
that will need to be completed and submitted electronically. So it is important
to note that individuals DO NOT need to contact HMRC at this time.
HMRC will be using existing information on their records to
check potential eligibility and to invite applications once the scheme is
operational and ready to go.
What if I have no
money and June is too long to wait for the payment?
It is understood that for many people waiting until June for
a payment will be too long a period to go without money. Understandably, not
everyone will have enough to tide them over until then.
In such cases the Chancellor has suggested that such
Self-Employed individuals will still be able to access alternative available
government support, including revised and more generous Universal Credit and
something called the Coronavirus Business Interruption Loan Scheme (CBILS).
It is important to note that fees and interest on these
loans will be paid by the government for the first 12 months making them
completely interest free for customers.
Applying for Universal Credit online has been simplified and
can be done by clicking here
Although standard Universal Credit payments would usually
begin 5 weeks after application approval, individuals are now eligible to
obtain an immediate cash advance, as soon as the initial application has been
accepted.
What else has been released and how do you access
it?
Deferral of Self Assessment Income Tax payments due
in July 2020 and VAT payments due from 20 March 2020 until 30 June 2020
Increased amounts of Universal Credit
Directors of their own company
paid through PAYE, may be able to get support using the Job Retention Scheme.
HMRC Contact Number: 0300 200 3300
Further details and additional information about the
self-employed scheme are to be shared by HMRC in due course. Please continue to
check our blog and newsletters for daily updates buy book marking us on your
browser for quick and easy access:
COVID-19 Self-Employment Income Support Scheme in the UK
Reviewed by Crystal Emmanuel
on
15:21
Rating:
Reviewed by Crystal Emmanuel
on
15:21
Rating:
No comments: