Self-Employment Income Support Scheme
On 26 March 2020 Chancellor Rishi Sunak announced that self-employed workers will be able to apply for taxable grants worth up to 80% of their average monthly profits to combat the loss of income due to COVID-19. These grants will be capped at £2,500 per month and will be paid direct into bank accounts in June at the earliest.
Who will be eligible?
To be able to apply for the new Self-Employment Income Support Scheme, the following must apply:
Your average annual trading profit must be less than £50,000.
Those whose average annual trading profit is £50,000 or more won't be able to get any support from this scheme.
You must earn more than half of your total income from self-employment.
This must have been the case for either your 2018/19 tax return or the average of your 2016/17 and 2018/19 tax returns (or both).
You must have filed a tax return for 2018/19.
This means you must have been self-employed prior to 6 April 2019.
If you're a company director and pay yourself a salary or dividends you won't be covered by this scheme, but you could get support through the Coronavirus Job Retention Scheme for employees if you operate pay-as-you-earn schemes.
How to apply to the scheme?
Those eligible will be contacted by HMRC directly once the scheme is operational. At that point you'll be asked to fill in an online form, and the grant will then be paid directly into your bank account.
We appreciate that June is a long way away so in addition to this you could try applying for a business interruption loan, if eligible. Or additionally it may be worth using money you have set aside for tax to cover immediate expenses, given that the July self-assessment tax payment can be deferred until January 2021.