COVID-19: Government announces Self-Employed Income Support Scheme

Rishi Sunak

Rishi Sunak

The support package provides the self-employed who have been adversely affected a taxable grant worth 80% of their average monthly profits over the last three years.

These will be backdated to March and the scheme will last three months at least.

"But he [The Speaker] can rest assured that we understand the situation that many self-employed people face at the moment as a result of what's happening and we are determined to find a way to support them".

Chancellor Rishi Sunak has announced a "self employed income support scheme" to protect self employed workers in the UK.

This is finance editor Claer Barrett's instant reaction to the Chancellor's self-employed support package during the coronavirus pandemic.

Self-employed people are a crucial part of the UK's workforce who've understandably been looking for reassurance and support during this national emergency.

Those with the lowest incomes are in line to receive more generous benefits payments, announced previously. "These determinations could also be taken into account to help identify the most vulnerable self-employed workers who need Government support".

To qualify, more than half of their income in these periods must come from self-employment. The scheme is only open to those with annual profits of less than £50,000.

"And to minimise fraud only those who are already in self-employment who have a tax return for 2019 will be able to apply", he said.

The income support scheme, which is being designed by HMRC from scratch, will cover the three months to May.

Workers will be able to access the grant no later than June, and it is expected that 95 percent of people who are majority self-employed will be able to benefit from the scheme.

Individuals should not contact HMRC now.

Self-employed workers are not paid through PAYE and they don't have the same obligations as a company director.

The scheme has been designed after extensive engagement with stakeholders including the TUC, the Federation of Small Businesses and IPSE - The Association of Independent Professionals and the Self-Employed.

"While we welcome the support package offered this afternoon by the Chancellor, we would be interested to hear Government's reasoning for excluding self-employed earning above £50,000 from the scheme", comments ContractorCalculator CEO Dave Chaplin.

The government's new help comes on top of a six-month delay for tax payments through the self-assessment system.

Latest News