Use this scheme if you’re self-employed or a member of a partnership in the UK and have lost income due to coronavirus.
The online service you’ll use to claim is not available yet. HMRC will aim to contact you by mid May 2020, and will make payments by early June 2020.
This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 a month. It will be available for 3 months, but may be extended.
The grant will be subject to Income Tax and National Insurance contributions but does not need to be repaid.
You can make a claim for Universal Credit while you wait for the grant, but any grant received will be treated as part of your self-employment income and may affect the amount of Universal Credit you get. Any Universal Credit claims for earlier periods will not be affected.
If you receive the grant you can continue to work or take on other employment including voluntary work.
If you have other employment as a director or employee which is paid through PAYE your employer may be able to get support using the Job Retention Scheme.
Who can claim
You can claim if you’re a self-employed individual or a member of a partnership and you:
- have submitted your Self Assessment tax return for the tax year 2018 to 2019
- traded in the tax year 2019 to 2020
- are trading when you apply, or would be except for coronavirus
- intend to continue to trade in the tax year 2020 to 2021
- have lost trading profits due to coronavirus
You will need to confirm to HMRC that your business has been adversely affected by coronavirus. HMRC will as usual use a risk based approach to compliance.
Your trading profits must also be no more than £50,000 and more than half of your total income for either:
- the tax year 2018 to 2019
- the average of the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019
If you have not submitted Self Assessment tax returns for all 3 years find out how HMRC will work out your eligibility
If you have not submitted your Self Assessment tax return for the tax year 2018 to 2019, you must do this by 23 April 2020 or you will not be able to claim.
HMRC will use data on the 2018 to 2019 tax returns already submitted to identify those eligible and will review any late returns filed before the 23 April 2020 deadline in the usual way.
If you amend a submitted return after 26 March 2020 any changes will not be taken into account when working out your eligibility or amount of the grant.
If you have loans covered by the loan charge
If you’re self-employed and have received payment for work or services in the form of a loan or other form of credit covered by the loan charge, you may be able to claim the grant, however your eligibility and average trading profits will be based on either:
- the average of the tax years 2016 to 2017 and 2017 to 2018
- the tax year 2017 to 2018 if you were not self-employed in the tax year 2016 to 2017
You do not have to file your 2018 to 2019 Self Assessment tax return by 23 April 2020. You should file by the 30 September 2020.
If you’re a farmer claiming farmers’ averaging relief
If you’re a self-employed farmer claiming farmers’ averaging relief HMRC will use the amount of profit before the impact of the averaging claims to work out:
- if you can claim the grant
- how much grant you will receive
Find out how HMRC works out your total income and trading profits for the Self-employment Income Support Scheme here.
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
To work out the average trading profit we will add together your total trading profits or losses for the 3 tax years then divide by 3.
If you have not submitted Self Assessment tax returns for all 3 years
HMRC will work out your average trading profit based on continuous periods of self-employment, which will be either:
- the tax years 2017 to 2018 and 2018 to 2019
- the tax year 2018 to 2019 only, even if you were self-employed in the tax year 2016 to 2017
The grant will be 80% of your average trading profit, divided by 12 which will give a monthly amount. HMRC will pay this or up to a maximum of £2,500 a month, whichever is lower.
HMRC will pay the grant directly into your bank account, in one instalment.
How to claim
You cannot make a claim yet.
HMRC will aim to contact you by mid May 2020 if you’re eligible for the scheme and invite you to claim using the GOV.UK online service. If you’re unable to claim online an alternative way to claim will be available.
This page will also be updated with the steps you can take to make it easier to claim using the GOV.UK online service.
You do not need to contact HMRC, as this will only delay the urgent work being undertaken to introduce the scheme.
You will only be able to claim using the GOV.UK online service. If you receive texts, calls or emails claiming to be from HMRC, offering financial help or a tax refund and asking you to click on a link or to give personal information, it is a scam.
After you’ve claimed
Once HMRC has received your claim and your grant is approved, they will contact you to tell you how much you’ll get and the payment details.
Other help you can get
The government is also providing the following additional help for the self-employed:
- deferral of Self Assessment Income Tax and VAT payments
- grants for businesses that pay little or no business rates
- Business Interruption Loan Scheme
Image: Andrea Piacquadio