Self-employment income support scheme: HMRC provides more information in updated guidance

HMRC has updated its guidance on the self-employment income support scheme.  

The updated guidance indicates that

• HMRC aims to contact those eligible by mid-May and still aims for payments to be made early June
• While waiting for the grant, it is possible to apply for Universal Credit  
• The grant will be subject to income tax and national insurance contributions but does not need to be repaid
• Anyone receiving the grant can continue to work or take on other employment including voluntary work
• Anyone claiming will need to confirm to HMRC that their business has been adversely affected by coronavirus. HMRC will use a risk-based approach to compliance
• To be eligible, trading profits must be no more than £50,000 and must be more than half of the person’s total income for either:
  • the tax year 2018 to 2019 or
  • the average of the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019
• The grant will be based on average trading profit over the 2016-2017, 2017-2018 and 2018-2019 tax years
• Where the person has not submitted self- assessment tax returns for all 3 years, HMRC will work out their average trading profit based on continuous periods of self-employment, which will be either:
  • the tax years 2017 to 2018 and 2018 to 2019 or
  • the tax year 2018 to 2019 only, even if they were self-employed in the tax year 2016 to 2017
• The grant will be 80% of average trading profit, divided by 12. This give a monthly amount. HMRC will pay this, subject to a maximum of £2,500 per month.

The updated guidance can be viewed here.