The New ‘Self Employed Income Support Scheme’ What do we know?
The Chancellor Rishi Sunak has announced a new package of measures to protect the incomes of the self-employed during the COVID-19 pandemic.
The initiative, known as the ‘Self Employed Income Support Scheme’, will pay self-employed people a taxable grant worth 80% of their average monthly income, capped at £2,500 per month.
Here are the key points as we understand them at this time:
- Income will be calculated by taking the average of income over the last three years.
- Self-employed people can claim these grants and continue to do business – this is not the same as furlough leave for the employed.
- The scheme is only open to anyone with trading profits of up to £50k, if you are self-employed and earn any more than that, you will not qualify.
- The scheme is only open to those who make the majority of income from self-employment – you cannot claim if you do a ‘second job’ which is self-employed.
- The scheme is only available to those who have submitted a tax return for 2019 in order to minimise fraud. Those who did not submit their tax return by the due date of 31 January 2020, have an extension to submit their return within the next 4 weeks.
- HMRC will contact eligible self-employed people directly and pay the grant straight into their bank account after inviting them to fill out an online form. There are no steps for you to take!
- The self-employed income support scheme will be open to people across the UK for at least 3 months. However, the scheme is unlikely to be up and running before the end of June, so it will not help with immediate cash flow issues.
We are awaiting further information and will update you as soon as further news is released.
Please note, all advice and opinion offered in this article are subject to change in line with the latest government advice.