On 26^th March 2020, the Government announced the highly anticipated measures to protect self-employed individuals via the new Statutory Self-Employed Income Support Scheme.

The Self-employed Income Support Scheme is equivalent to the Job Retention Scheme on offer to support employers with their employee’s income in terms of the level of grants.

With the scheme not being open until June, it will not help with immediate cash flow however, 3 months’ worth of grants will be received in one go.

For those who have recently registered as self-employed and have not submitted a tax return, they will not be eligible for the Self-Employed Income Support Scheme. In this instance, you will need to apply for Universal Credit and the Employment and Support Allowance (ESA) as alternatives. More information can be found in the links below*.

Statutory Self-employed Income Support Scheme:

• This entails a taxable grant worth 80% of your average monthly profits over the last 3 years, up to a maximum £2,500 per month
• The grant will be paid directly into self-employed individuals bank accounts
• HMRC will contact those who are eligible with an online form, details to follow
• It will be backdated to 1^st March 2020 and open for at least 3 months. The Government have confirmed they will extend the period if necessary
• It is only accessible to those with trading profits up to £50,000 but this is expected to benefit 95% of self-employed individuals
• It will only apply to those who make the majority of income from self-employment 
• Only those who have a tax return for the 2018/19 tax year can apply in a measure to minimise fraud
• Access to the grant is expected by the beginning of June when 3 months’ worth of grant will be received
• Anyone who missed the 31 January 2020 tax return filing deadline has 4 weeks (from 26^th March 2020) to submit their tax return
• Income tax payments due in July 2020 can be deferred to the end of January 2021
• If you are UK VAT registered business and have a VAT payment due between 20th March 2020 and 30th June 2020, you have the option to:
  • defer the payment until a later date
  • pay the VAT due as normal
• HMRC will not charge interest or penalties on any deferred amount.

*If you are not eligible for the Statutory Self-employed Income Support Scheme and you are unwell or are unable to work due the coronavirus and self-isolation, you will be able to apply for the employment and support allowance (ESA) and/or Universal Credit. The weekly payment for ESA is typically £73.10 or £57.90 for people under the age of 25.

The Government is also raising the payments for Universal Credit so that the self-employed receive the same amount as an employee on statutory sick pay (£94.25 a week).

The Citizens Advise website below provides further information and link access to the application processes.

Check if you can claim ESA                  Check if you can claim Universal Credit