COVID-19 Financial Aid for the Self-employed Announced
Earlier tonight, we saw the Chancellor announce a much-anticipated financial aid package for the self-employed. The support package is designed to help those working for themselves who are affected by the COVID-19 crisis.
The main points of his statement include:
- Anyone who is self-employed who has seen a loss of income due to the coronavirus crisis may be eligible.
- The grant offers 80% of their average monthly profits, up to £2,500 per month, as part of the Coronavirus Self-employment Income Support Scheme.
- Those eligible must make the majority of their income from self-employment.
- The figure available for the self-employed to claim will be based on their average profit for the last three financial years, or fewer if they have traded for less.
- To be eligible for the scheme they must have filed a 2018/2019 tax return; any late filers will be given an additional 4 weeks to file their return.
- The scheme will be open to those who have an average trading profit of less than £50,000 per financial year.
- HMRC will use their own information to identify and invite those eligible to apply.
- The grant will begin being paid from the beginning of June.
- The chancellor did reference the inconsistency between employment status and tax paid. This could signal intentions to make changes to the way the self-employed are taxed in the future.
- Directors of their own Personal Service Company will not qualify for this scheme, however, may qualify for the Coronavirus Job Retention Scheme.
We will be providing more information on these updates as they are made by the Government. For more information on what support has been announced for directors of companies in the wake of the Coronavirus Crisis, please visit our article here.