Eat Work Art Guide for self-employed workers during Covid-19
Support was recently announced for self-employed workers alongside more stringent measures to keep the public safe. We wanted to share our latest guide to help clarify key terms and how this might affect you, your business and working remotely.
FREELANCERS & SELF-EMPLOYED
The encouraging new scheme means that self-employed workers can apply for a grant worth 80% of their average monthly profits to help them cope with the financial impact of coronavirus. The scheme is offering up to £2,500 per month in grants for at least 3 months.
In order to apply your self-employed trading profits must be less than £50,000 and more than half of your income from self-employment. This is determined if at least one of the below applies to you:
- Have your trading profits in 2018-19 equaled less than £50,000 and do these profits constitute more than half of your taxable income?
- Does your average trading profit in 2016-17, 2017-18, and 2018-19 total less than £50,000 and constitute more than half of your average taxable income in the same period?
This covers 95% of people who receive the majority of their income from self-employment.
Workers who have not yet submitted Income Tax Self-Assessment tax returns for the tax year 2018-19 must do this by 23 April 2020.
The scheme will be available for at least three months and those who have access to the grants are still allowed to continue to do business. Chancellor, Rishi Sunak outlined that it would be unlikely that people would be able to access the scheme until June, and that in the meantime, self-employed people would have to access the business interruption loans and welfare system.
The new scheme will be able to apply directly to HMRC for the taxable grant, using a simple online form, with the cash being paid directly into people’s bank account. To minimise fraud, only those who are already in self-employment and meet the above conditions will be eligible to apply. HMRC will identify eligible taxpayers and contact them directly with guidance on how to apply.
Individuals should not contact HMRC now. HMRC will use existing information to check potential eligibility and invite applications once the scheme is operational.
Please see the Government website for up-to-date information.