Coronavirus - Help for the Self Employed

The scheme announced by the Government will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.

Who can apply

self-employed individuals or a members of a partnership who:

• have submitted your Self Assessment tax return for the tax year 2018-19

• traded in the tax year 2019-20

• are trading when you apply, or would be except for COVID-19

• intend to continue to trade in the tax year 2020-21

• have lost trading/partnership trading profits due to COVID-19

Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. This is determined by at least one of the following conditions being true:

• having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income

• having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period

If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

How much you will get

You’ll get a taxable grant which will be 80% of the average profits from the tax years:

2016 to 2017, 2017 to 2018 and 2018 to 2019

HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 3 (where applicable), and use this to calculate a monthly amount up to a maximum of £2,500 per month for 3 months.

The grant will be paid directly into your bank account, in one instalment.

You cannot apply for this scheme yet.

HMRC will contact you if you are eligible for the scheme and invite you to apply online.

Individuals do not need to contact HMRC

If someone texts, calls or emails claiming to be from HMRC it is a scam.

Once HMRC has received your claim and you are eligible for the grant, they will contact you to tell you how much you will get and the payment details.

If you claim tax credits you’ll need to include the grant in your claim as income.

Don’t forget

The government is also providing the following additional help for the self-employed:

• You can defer your Payment on Account due on 31 July 2020

• You can defer VAT payments due between now and 30 June 2020 – You must still submit your VAT return and are advised to cancel any Direct Debit for VAT

• Businesses that pay little or no business rates may be eligible for a grant

• You may be eligible for a loan under the Business Interruption Loan Scheme

If you’re a director of your own company and paid through PAYE you may be able to get support under the Job Retention Scheme.