Self-Employed Support during COVID-19 pandemic

Self-Employed Support during COVID-19 pandemic

11 Dec 2020

What Self-employed support was available in March 2020, and how can it be access?  This was the question everyone is still asking right now.  I will do my best to answer it for everybody.

 

This level of self-employed support is unprecedented and we are still waiting for confirmation on some of the details.With that in mind, please remember not all countries are able or willing to provide financial support at this time.

"I don't have any money now! - if you don't have any money for food and can't pay your rent. Please apply for Universal Credit now or a Business Interruption Loan.

Universal Credit for Self-employed Support - This is the safety net we have in this country to keep people hopefully from starving and a roof over their head.  It is also being used now as Statutory Sick Pay for people who are Self-Employed.  What's Available:  You will get between £250 and £500 a month plus a child element, depending on your circumstances.  Crucially, you should get help with your rent and free prescriptions.  It is worth applying for it you are eligible, as £1,000 and is at least some of your rent paid will make a difference in 3 months time and usually you can't backdate it.

Eligibility:  Your current earnings are less than £315 a month and you have less than £15,000 in savings.

If you are on other benefits like Tax Credits, I wouldn't recommend changing as the offices are really busy right now.

 

Self-Employed Support Scheme.  This is designed to give the same support as the recently announced scheme for employees who are negatively affected by COVID 19.  There are still kinks to work out and we are all in slightly difference situations.  Hopefully 95% of us will get some help - ideally 80% of our income.

Whats Available:  80% of your income for March, April and May.  Your income is based on what you declare to HMRC on your tax returns.  Yes, all those clever ways to reduce tax might bite us in the bum here, but the chances are you will get something.

How do they work it out?  They will sue your last 3 years tax returns (or 1 or 2 if you have less) and take an average.  For example, if your business has been growing and you declared to the tax office your net profit as:

2018/19 tax year = £20,000

2017/18 tax year = £15,000

2016/17 tax year = £10,000

Add up the total, which is £45,000 and divide by 3 to get the average, which is £15,000.  Divide this by 12, to give you a monthly amount, which is £1,250 a month.  Multiply by 80% to give you your monthly payment = £1,000.  Or multiply by 80 and divide by 100 to give you 80% = £1,000 a month.

The Government have promised 3 months to cover March, April and May, which will be paid in June.  Which is in this example will be £3,000.00.

Eligibility:

 

  1.   1.Be Self-Employed
  2. Have submitted at least one tax return (if you are late, please do it now)
  3. 50% of your total income must come from being self-employed.
  4. Income in this case is the same as net profit declared on your tax return.  This is, your money after you have paid your business costs - not sales or turnover. 
  5. Maximum payment is £2,500 and only if you earn less than £50,000 a year.
  6. Currently for 3 months (March, April, May)
  7. You don't have to close your business like Furlough for Employees and you can still work.
  8. the scheme is aimed at those negatively affected by COVID 19.

Apply: You cannot apply now.  HMRC will invite you to apply in due course.  This will be announced when this happens.