Self-employment Income Support Scheme
On Thursday 26 March the government announced their intention to provide further support for the self-employed in the form of a taxable cash grant.
The scheme allows individuals to claim a taxable grant worth 80% of their trading profits up to a maximum of £2,500 per month for the 3 months from March to May 2020. This may be extended if needed.
It will be paid in June 2020 to those that are eligible directly into their bank account.
It will be paid in June 2020 to those that are eligible sole traders and members of partnerships.direct into their bank account. The taxable cash grant will be in the form of a single lump sum to cover the three months from March to May 2020. The self-employed individuals will be eligible if their trading profits for 18/19 were less than £50,000 and more than 50% of their income stems from self-employment.
Alternatively, they will be eligible if their average trading profits for the tax years 16/17, 17/18 and 18/19 were less than £50,000 and more than 50% of their income came from self-employment. For those that started trading between 2016-19 HMRC will only use those years for which a Self-Assessment tax return has been filed.
The scheme will be open to those that have submitted an income tax self-assessment tax return for the year to 5 April 2019. HMRC’s guidance does state that the 18/19 tax return must be filed by 23 April 2020 in order to be eligible.
Additional eligibility criteria include the requirement that the individual must have lost trading profits due to Covid-19 Coronavirus and they must have traded in 2019/2020, intend to trade in 2020/2021 and are trading at the point of application or would have been except for Covid-19.
You are advised not to contact HMRC now. It is crucial to observe that HMRC will contact and invite those that are eligible to apply. Applications will need to be made online when the invitations have been issued by HMRC.