Covid-19

New Government Measures for Self-employed

27/03/2020

Please find below a clarification of the new Coronavirus measures for the self-employed.  The Chancellor announced these measures yesterday.  There are certain points which were not clear so I will be clarifying for myself later.

I shall be contacting you all within the next few days to inform you how you stand with these measures.  Please bear with me. I will get to you.

Conditions

Self-employed people – Sole traders and Partnerships will be given a taxable grant of 80% of their trading profits or £2,500.00 per month whichever is lower.  This is payable for a maximum of 3 months and is not expected to be paid until June.  It expected a lump sum will be paid.

To Qualify:

• 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

Self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. This is determined by at least one of the following conditions being met:

• 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

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 and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way

You cannot apply for this scheme yet.

HMRC will contact you if you are eligible for the scheme and invite you to apply online.

Access to this scheme is only through GOV.UK. 

Once HMRC has received your claim and you are eligible for the grant, they will contact you to tell you how much you will get and the payment details.

If you claim tax credits you’ll need to include the grant in your claim as income.

Unfortunately, those who started trading during this current tax year 2019/20 will not be eligible.  

I hope the above helps. 

I shall be in contact soon.

Best Regards

David Turner – Complete Accounting Services