COVID-19 SELF-EMPLOYEMENT ADVICE

Check if you can claim a grant through the Self-Employment Income Support Scheme

 

If you're self-employed or a member of a partnership and have been adversely affected by coronavirus (COVID-19) find out if you can use this scheme to claim a grant.

 

The scheme will allow you to claim a taxable grant of 80% of your average monthly trading profits, paid out in a single instalment covering 3 months, and capped at £7,500 altogether. This is a temporary scheme, but it may be extended.

If you receive the grant you can continue to work, start a new trade or take on other employment including voluntary work, or duties as an armed forces reservist.

The grant will be subject to Income Tax and self-employed National Insurance.

There is other support available if you’re not eligible for the grant.

HMRC will work out if you’re eligible and how much grant you may get. But you can follow these steps to help you understand how we will do this and what you can do now.

  1. Find out who can claim.

  2. Check online if you’re eligible and when you’ll be able to claim.

  3. Find out how HMRC calculates your grant.

  4. Find out how you’ll make a claim when the online service becomes available.

  5. Find out when you’ll get the money paid into your bank and how to record the grant.

Who can claim

You can claim if you’re a self-employed individual or a member of a partnership and:

  • you traded in the tax year 2018 to 2019 and submitted your Self Assessment tax return on or before 23 April 2020 for that year

  • you traded in the tax year 2019 to 2020

  • you intend to continue to trade in the tax year 2020 to 2021

  • you carry on a trade which has been adversely affected by coronavirus

Your business could be adversely affected by coronavirus if, for example:

  • you’re unable to work because you:

    • are shielding

    • are self-isolating

    • are on sick leave because of coronavirus

    • have caring responsibilities because of coronavirus

  • you’ve had to scale down or temporarily stop trading because:

    • your supply chain has been interrupted

    • you have fewer or no customers or clients

    • your staff are unable to come in to work

You should not claim the grant if you’re above the state aid limits or operating a trade through a trust.

To work out your eligibility HMRC will first look at your 2018 to 2019 Self Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.

If you’re not eligible based on the 2018 to 2019 Self Assessment tax return, HMRC will then look at the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019.

Find out how HMRC will work out your eligibility including if we have to use other years.

Grants under the Self-Employment Income Support Scheme are not counted as ‘access to public funds’, and you can claim the grant on all categories of work visa.

Your tax agent or adviser cannot make the claim for you. You must make the claim yourself. If you use an agent you should contact them if you need any help or support.

How different circumstances affect the scheme

Check if your circumstances affect your eligibility, for the following:

  • if your return is late, amended or under enquiry

  • if you’re a member of a partnership

  • if you’re on or took parental leave

  • if you have loans covered by the loan charge

  • if you claim averaging relief

  • if you’re non-resident or chose the remittance basis

  • if you’re above the state aid limits

Check if you’re eligible to claim

You can use our online tool to find out if you’re eligible to make a claim. We can also use the online tool on your behalf.

You’ll need your:

  • Self Assessment Unique Taxpayer Reference (UTR) number - if you do not have this we can help you get your lost UTR number

  • National Insurance number - if you do not have this we can help you get your lost National Insurance number

Online services may be slow during busy times. 

If you’re eligible

HMRC will tell you the date you’ll be able to make a claim from and ask you to add your contact details. HMRC will use these to remind you when the online service will be available.

If you’re not eligible

If HMRC told you that you’re not eligible to make a claim, you can ask HMRC to review this after you’ve used the online tool. If you want to do this at a later time, you’ll be able to use the online tool more than once.

How much you’ll get

You’ll get a taxable grant based on your average trading profit over the 3 tax years:

  • 2016 to 2017

  • 2017 to 2018

  • 2018 to 2019

HMRC will work out your average trading profit by adding together your total trading profits or losses for the 3 tax years, then they will divide by 3.

The grant will be 80% of your average monthly trading profits, paid out in a single instalment covering 3 months, and capped at £7,500 altogether. The online service will tell you how HMRC worked the grant out.

The grant amount we work out for you will be paid directly into your bank account, in one instalment.

How to claim

The online service will be available from 13 May 2020. If you’re eligible, HMRC will tell you the date you can make your claim from. If your claim is approved you’ll receive your payment within 6 working days.

If you’re unable to claim online an alternative way to claim will be available. We will update this page with more information soon.

You do not need to contact HMRC now, as this will only delay the urgent work being undertaken to introduce the scheme.

When you make your claim

You’ll only need your:

  • Self Assessment UTR 

  • National Insurance number

  • Government Gateway user ID and password

  • bank account number and sort code you want us to pay the grant into (only provide bank account details where a Bacs payment can be accepted)

You’ll have to confirm to HMRC that your business has been adversely affected by coronavirus.

If you claim the grant HMRC will treat this as confirmation you’re below the state aid limits.

HMRC will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate.

After you’ve claimed

Once you’ve submitted your claim, you will be told straight away if your grant is approved. HMRC will pay the grant into your bank account within 6 working days.

You must keep a copy of all records in line with normal self-employment record keeping requirements, including:

  • the amount claimed

  • the claim reference number for your records

  • evidence that your business has been adversely affected by coronavirus

You will need to report the grant:

  • on your Self Assessment tax return

  • as self-employed income for any Universal Credit claims

  • as self-employed income and that you’re working 16 hours a week for any tax credits claims

Account for it Ltd

Natalie Yates MICB
Tel: 07738421164
Email: account_for_it@yahoo.co.uk​
Registered address: 22 Cranham Grove, Bransholme, Hull, East Yorkshire, HU7 4QB, UK

 

 

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