BUDGET: Support for the self-employed

The Chancellor has announced more support for the self-employed in today’s Budget.

With nearly a fifth of self-employed people missing out on previous grants because they had only recently started working for themselves and so could not prove their income status on their tax return, today’s announcement will come as welcome news.

Two further payment grants have been announced for those struggling to work because of coronavirus as part of the Self Employed Income Support Scheme (SEISS).

The fourth grant covers the three-month period from the start of February until the end of April. As with previous SEISS grants, it is worth up to 80% of trading profits, averaged over three months, up to £7,500 in total. The fifth grant covers early May to late July, but the amount available depends on loss of income.

Workers whose turnover has fallen by at least 30% can still apply for a grant for up to 80% of profits, up to a value of £7,500 in total. Those whose income has fallen by less than that can apply for up to 30% of trading profits, again averaged over three months.

Claims can be made for the fourth grant from the beginning of April and claims for the fifth grant will open in July.

Who is eligible?

Those who completed tax returns for the 2019-2020 financial year will qualify for these new payments, provided they filed their return by midnight on 2 March 2021. They previously lost out if they had not been trading in 2018-2019. More than half of a claimant’s income needs to come from self-employment.

The schemes have been open to those with a trading profit of less than £50,000 in 2018-19, or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19.

Now newer tax records are available, the Treasury has said those who were self-employed in 2019-2020 will qualify. The government’s help comes on top of extended delays for tax payments through the self-assessment system. Payment plans can be set up, giving people more time to pay their full tax bill up to January 2022.

Those with the lowest income are in line to receive more generous benefits payments compared with before the crisis.

Source: BBC News

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