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What help for the self-employed will there be, and who can I talk to about it?

On the evening of Friday 20 March, the Chancellor of the Exchequer Rishi Sunak announced the first set of additional measures to help smaller businesses and the self-employed affected by COVID-19. The UK government has told us there will be more help as the situation intensifies. Within draft emergency legislation now being published, the government is taking new legal powers to enable it to offer whatever further financial support is necessary to back business.

FSB is pressing for further help for the self-employed and for those outside of the leisure, hospitality and retail sectors. As the virus accelerates we want to look at larger, more radical measures such as 3-6 month holidays on National Insurance Contributions, VAT, PAYE; changes to insolvency; and the suspension of paying rent, tax and utilities for the same time.

What is the self-employment Income Support Scheme and how do I apply?

This scheme will support self-employed individuals (including members of partnerships) who have lost income due to coronavirus (COVID-19). The scheme will allow those eligible to claim a taxable grant worth 80% of you trading profits up to a maximum value of £2,500 each morth for the next three months. This scheme will be reviewed and extended if required.

Who is eligible?

You must be a self-employed individual or a member of a partnership and meet the following criteria:

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

In addition to this, your trading profits must be less than £50,000 and more than half your income must come from self-employment. This is defined as:

having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period

This scheme uses information from your Income Tax Self-Assessment tax return, if you have not submitted one for the tax year 2018-19 you must do this by 23 April 2020. If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.

How much will I get?

The grant will be calculated by using a figures 80% of your average profits from the tax years covering 2016-2019. This means that the three years will be added together and divided by three, your grant will be 80% of this figure with a maximum value of £2,500 a month. This will be paid directly into your bank account.

How to I claim this?

You need to take no action. HMRC will contact you if you are eligible for this scheme and invite you to apply. Please be award that only HMRC are providing this scheme, if you receive a text, calls or email claiming to be from HMRC, informing you that you can claim financial help or are owed a tax refund asking you to click on a link or to give information such as your name, credit card or bank details, it is a scam.

In Wales

The Welsh Government has announced a new fund for the self-employed and businesses to help deal with the impact of the Coronavirus. FSB has encouraged the Welsh Government to use this money to help those that have not been covered by the recent announcement of the Self-employment Income Scheme, and for the money to be available before the HMRC’s June go live date. Find out more here: