The Self-employed Income Support Scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month. This scheme is available for three months, but this may be extended.
Who Is The Scheme Designed For?
This scheme should be considered for those who are self-employed or a member of a partnership who have lost income due to COVID-19.
The most important thing to note is that you must have lost income due to the pandemic. The government have stated that ‘HMRC will, as usual, use a risk-based approach to compliance.’ This means that you will have to prove that your profits have been adversely affected. If not immediately as it will be evident in your next set of returns.
Will I Have To Pay Tax?
Yes. The grant will be subject to income tax and NI contributions, but it does not need to be repaid to HMRC.
Are You Eligible?
To meet the criteria for eligibility, you will have:
· Submitted your self-assessment tax return for the tax year 2018 to 2019
· Traded in the tax year 2019 to 2020
· Are trading when you apply, or would be except for coronavirus
· Intend to continue to trade in the tax year 2020 to 2021
· Have lost trading profits due to coronavirus
Do You Meet The Financial Criteria?
Your trading profits must be no more than £50,000. For those who might have a part-time PAYE income, to be eligible for this grant, more than half of your income must come from self-employed activities.
How Much Will I Get?
The taxable grant you receive will be based on your average trading profit over the following three tax years:
How To Make A Claim
You will not yet be able to make a claim for this support. The government have stated: HMRC will aim to contact you by mid May 2020 if you’re eligible for the scheme and invite you to claim using GOV.UK online services.
Need Further Support?
If you have questions about the support available or would like further advice, please contact us today.