Chancellor announces support for self-employed
The Chancellor has announced the self-employed income support scheme.
Under the scheme:
- Self-employed people who have been adversely affected by the coronavirus crisis will be eligible. The scheme is limited to those with trading profits up to £50,000 per annum who make the majority of their income from self-employment. They can receive a taxable grant equal to 80% of their average profits over the past three years, subject to a cap £2,500 per month
- The grant will be available for up to three months and will be extended if necessary
- They will be able to continue to do business
- To avoid abuse, only those who are already self-employed and who have submitted a 2018/19 income tax return will be eligible. Anyone who did not submit their tax return by 31 January 2020 has four weeks from today to do so
- HMRC will contact those who are eligible and they should be able to access the grant from the start of June when it will be paid in one lump sum
In a further measure to help the self-employed, the chancellor also announced that income tax bills due for payment in July can be deferred until the end of January 2021.
In the meantime, self-employed people can apply for a business interruption loan and access universal credit.
However, the chancellor said he can no longer justify self-employed people paying less tax than the employed and so this is something that is likely to change in the future.
It seems that the scheme will not cover contractors operating through personal service companies but we await confirmation on that.
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