Latest News: Self Employed Income Support Scheme
The Self Employed Income Support Scheme for individuals whose business has been adversely effected by CV-19 goes live on Wednesday 13 May and all eligible individuals will be invited to lodge their claim.
The scheme will allow you to claim a taxable grant of up to 80% of your trading profits up to a maximum of £2,500 per month for the 3 month period April to June.
- You can apply if you are a self-employed individual or member of a partnership and you:
- Have submitted your Self Assessment Return for 2018/19
- Traded during 2019/20
- Are still trading when you apply (or would be except for COVID-19)
- Intend to continue to trade during 2020/21
- Have lost trading/partnership profits due to COVID-19
- Your self employed profits must also be less than £50,000 and more than half your income comes from self employment.
Please note that we will not be able to make the claim for you.
Please therefore read the following carefully:
- HMRC will be contacting all self employed individuals via email (through their Government Gateway contact details), inviting them to claim the grant
- This will require all clients to have an operational Government Gateway Account with HMRC
- If you currently have an active Gateway Account please now logon and make sure all contact details are up to date
- If you do not currently have an active account, please register immediately using the following link:
- Choose ‘Sign in’ – the green button
- Scroll to the bottom of the page and click on ‘Continue to your account’
- If you already have an account, enter your Government Gateway user ID and Password and follow the instructions. Once logged in, check all details are up to date.
- If you do not have an account choose ‘Create sign in details’ and follow the instructions carefully. You will need to work through a series of security questions before finally obtaining an active account. Please note all answers to security questions carefully.
HMRC will contact you and invite you to make the necessary claim so please do not attempt to contact them. We do not yet know the format but understand that the claim will be simple and will require just your Self Assessment reference number (UTR), National Insurance number, and details of the bank account you wish the grant to be paid into. HMRC will advise you of the amount due based on the records they hold. We would be grateful if you could advise us how much they have calculated so that we can agree it to our records in due course.
If you receive texts, calls or emails claiming to be from HMRC, offering financial help or a tax refund and asking you to click on a link or to give personal information, it is a scam. The ONLY information you should provide should be through your secure Government Gateway Account.
Grants should be paid within 6 working days of the claim being made.
Temporary measures have been put in place to support public services, people and business through this period of disruption, these include:
- A Coronavirus Job Retention Scheme – placing staff on ‘furlough’ leave
- Deferring VAT and Income
- Tax payments
- A Statutory Sick Pay relief package for small and medium sized businesses (SMEs)
- A 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
- Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
- Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
- The Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
- A new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
- The HMRC Time To Pay Scheme.
100% guaranteed loans to small businesses
The Chancellor has announced further support measures in the form of 100% guaranteed loans to small businesses.
The scheme should be open from Monday 4 May and the intention is for the application to consist of a short and simple online form with successful applicants receiving funds within a few days.
- Loans of between £2,000 and £50,000 (but limited to a maximum of 25% of turnover)
- Loan terms will be up to 6 years
- No fees or interest to pay for the first 12 months
- No loan repayments will be due during the first 12 months
- ‘A low and standardised level of interest for the remaining term of the loan’
- 100% guarantee provided to the lender by the government
Click on the button link for more info:
Coronavirus Job Retention scheme
All UK employers who had a payroll and PAYE scheme in place on 28th February will receive support to help pay employees that would otherwise have been laid off during this crisis. They will remain employed and classed as a “furloughed worker”. As an employer you can claim a grant of up to 80% of their wage up to a cap of £2,500 per month. You could choose to fund the differences between this payment and the salary but you do not have to.
The government expects the service to claim these wages to be available by the end of April.
How it works:
- To be eligible for the scheme employees must have been employed before 1st March.
- The minimum period of furlough is 3 weeks.
- If an employee is sick or self-isolating they should get SSP, and can be furloughed after the period of SSP has ended.
- Employees who are shielding in line with public health guidance, such as pregnant employees, or those with serious underlying health conditions, can be placed on furlough.
- If an employee is working, but on reduced hours, or for reduced pay, they will not be eligible for this scheme and you will have to continue paying the employee through your payroll and pay their salary subject to the terms of the employment contract you agreed.
- If an employee has 2 jobs, they can be furloughed for each separately, the cap applies to each employer individually.
- Employees have the same right when furloughed as they did before.
- It’s likely that redundancy consultation processes could be carried our whilst staff are on furlough but normal protections and consultation processes apply. The principle is that if you need to reduce staffing levels, you will be able to make staff redundant after the furlough has ended.
- Employers can claim 80% of an employee's regular wages plus employer NI and the minimum automatic enrolment employers pension contributions.
- For full time and part time salaried employees, the employee’s actual salary before tax, as of 28th February should be used to calculate the 80%. Fees, commission and bonuses should not be included.
- For employees whose pay varies you can choose either of the following:
- the same month’s earning from the previous year
- average monthly earnings from the 2019-20 tax year
- Once you’ve worked out how much of an employee’s salary you can claim for, you must then work out the amount of Employer National Insurance Contributions and minimum automatic enrolment employer pension contributions you are entitled to claim.
- To make the claim you will need:
- your ePAYE reference number
- the number of employees being furloughed
- the claim period (start and end date)
- amount claimed (per the minimum length of furloughing of 3 weeks)
- your bank account number and sort code
- your contact name
- your phone number
- You will need to calculate the amount you are claiming and the funds will be reimbursed to you. HMRC will retain the right to retrospectively audit all aspects of your claim.
- Payments received by a business under the scheme are made to offset these deductible revenue costs. They must therefore be included as income in the business’s calculation of its taxable profits for Income Tax and Corporation Tax purposes, in accordance with normal principles.
Self-employment Income Support Scheme
This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months.
You are entitled to this scheme if you are self-employed or a member of a partnership and have lost income during this pandemic.
These following rules will also apply:
- have submitted your Income Tax Self Assessment tax return for the tax year 2018-19
- traded in the tax year 2019-20
- are trading when you apply, or would be except for COVID-19
- intend to continue to trade in the tax year 2020-21
- have lost trading/partnership trading profits due to COVID-19
Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment.
If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.
HMRC will use data on 2018-19 returns already submitted to identify those eligible. This means that you do not need to apply for this scheme, HMRC will be in contact with you to invite you to apply online. Please refrain from calling HMRC as you can understand they are very busy during this period and will only delay their workings. HMRC expect to start paying out by the beginning of June.
Business Interruption Loan Scheme (BILS)
BILS has been set-up to support businesses financially via banks and other institutions, loans will be interest free for 12 months and are designed to help businesses continue during COVID-19.
VAT and Income Tax payments
Businesses will not need to make a payment for VAT during the period of 20th March – 30th June. The company does not need to apply for this, it is automatic. If you wish to defer payment then you will have until the end of the tax year 2021 to make this payment, please note that no interest will be charged and the return will still need to be filed.
If you are self-employed, income tax payments that were due in July 2020 may deferred until January 2021.
Statutory Sick Pay relief package
Small and medium sized businesses and employers will be able to reclaim statutory sick pay for those with employees off due to coronavirus. There are rules to this:
- The refund will be for up to 2 weeks for only those that are off due to coronavirus
- Employers with fewer than 250 people
- Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP sick note.
If employees are caring for people in the same household and therefore have been advised to do a household quarantine then they are also entitled to SSP.
Business rates holiday & small business grant funding
If your business if based in the UK and is in the retail, hospitality and/or leisure sector then you will be eligible for a business rates holiday. You don’t need to apply for this it will be included in your April bill. Click here to estimate the business rate charge you will no longer have to pay.
Grants of £25,000 per property will be available for properties with rateable values of between
£15,001 and £51,000. Your local authority will contact you directly to arrange this.
Mortgages & rent
On Tuesday 17th March, banks agreed with the Chancellor that they will offer 'forbearance' (tolerance and help) on mortgages. This means they all should offer those struggling a three-month 'holiday', allowing customers a temporary break from having to make mortgage payments during this time. Please note this isn’t compulsory, you will need to check with your mortgage provider.
You will still be charged interest, but it’s added to the total cost and you get short time respite. You won’t have to pay it straight away it will be added on to the total cost of your mortgage and factored into repayments when you start making them.
If you can't pay your rent - the government has announced a ban on evictions - your landlord can’t start court action for at least 3 months. You should explain the situation to your landlord straight away - they might give you more time to pay.
Increase to working Tax Credits
Working Tax Credits payments will be increased by £1,045 to £3,040 per year from 6th April 2020 until 5th April 2021. The amount a claimant or household will benefit from will depend on their circumstances, including their level of household income. But the increase could mean up to an extra £20 each week. If you already claim these credits you won't need to do anything, these will automatically be paid to you from April.