UPDATE 15 APRIL 2020: HMRC have published more details about the grant and how average profits will be calculated. See
- Coronavirus: self employment grant and
- Coronavirus: calculating self employment grant
The Chancellor has finally announced measures to financially support self-employed individuals through the Coronavirus crisis.
Few details are available at the moment and we only really have the headlines so far:
What is available?
Self-employed individuals may be able to receive a cash grant of 80% of their profits up to £2,500 per month.
Whilst this is on a par with employees it will not be available until June when a single payment will be made to cover the three months March, April and May.
The chancellor has strongly hinted that the self-employed might have to pay this back in the future with tax hikes. I suspect the previously withdrawn suggestion of raising the class 4 NIC percentage will likely re-appear.
What profits are included?
The 80% of profits is to be based on average profits over three years.
The three years to be taken into account are those for the tax years 2016/17, 2017/18 and 2018/19 which is really bad news for anyone who only started trading recently, or has only just begun to show a profit.
At least half of your income must have come from self-employment in these years.
Your trading profit must be less than £50,000 in 2018/19 or on average over those three years.
How can I access the scheme?
HMRC are intending to identify eligible taxpayers and contacting them with guidance about how to apply.
A ‘simple online form’ is being planned for making applications.
More details will be available at some point I’m sure and I will update this happens.
In the meantime please do contact me with any questions.
