Apply for Self Employed Income Support
At 5pm, on the 27th March 2020, the Chancellor announced the details of the Self Employed Income Support which is a package to aid self-employed individuals with funding through the COVID-19 isolation period. Up to 80% of profits (up to Â£2,500 a month) will be given as a grant to those who apply, and unlike the Universal Credit this is not a per-household grant and neither does it take the amount of a personâ€™s savings into account. For those who have self-employment work and a PAYE job, they will be eligible if more than 50% of their income is earned through their self-employment.
HMRC will work out who is eligible based on the submissions of 2018-19 Tax Returns. This does mean that self-employed individuals who started trading in 2019 will not be eligible for this grant and should look into Universal Credit or local council funding for their business. The profits are averaged over up to the last three years of submitted tax returns; due to this process HMRC employees will undertake, it is advised that you do not contact HMRC.
Applications online are currently unavailable. Using the process above, HMRC will then contact the eligible people and tell them how they can apply online through their system. If HMRC contact a self-employed person and ask directly for their bank details over the phone, or by email or text message, it is likely a scam and the contact should be ignored.
The income support will not be paid until June, and this payment will be made up of financial support for May, April and June in one lump sum. This is a taxable income source, and so the receipt and evidence should be retained for the relevant Tax Return. Understandably, a payment in June will not cover costs for the upcoming months. You can receive Universal Credit and the Income Support, and when claiming for Universal Credit you can request an advance payment. Loans will be available from banks, some with zero-interest for businesses, which can be used to cover bills. The individual can keep working through their self-employment while receiving this aid.
Mortgages are having a 3-month â€˜holidayâ€™; payments will not be required on mortgages during this time. In order for this to take effect, the mortgage lender must be contacted and informed that the individual requires the aid due to the Corona Virus. It is important to inform any billing companies, if requesting finance support, that it is a cause of the Corona Virus. Reporting that a job was lost is not enough as there are multiple reasons why someone can lose a PAYE job, so be sure to explain the virus has had an effect on your situation.
The mortgage holiday will not affect your credit rating, however do not cancel direct debits without informing the companies as it has been advised that uninformed cancellation will affect credit rating scores. Tags:
Corona Virus, self employment, HMRC updates