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Last week the Chancellor unveiled the support that is going to be available for the self-employed. This should be available for an estimated 95% of the self-employed population and for those eligible the government will pay a taxable cash grant of up to 80% of their average monthly earnings. This will be based on the previous earnings of the past three years and capped at £2,500 per month. If your earnings do not cover the last three years then the Treasury will look at what is available and make a judgement on that.
To be eligible, self-employed people must:• Make more than 50% of their income from self-employment.• Have taxable profits of less than £50,000 in 2018-2019, or average taxable profits of less than £50,000 in 2016-2017, 2017-2018, 2018-2019 and have traded in the 2019-2020 tax year.• Be currently trading at the time of application, or would be but for COVID-19.• Already be self-employed and have filed a tax return on the basis for the 2018-2019 tax year.
There will be an online form to fill in (currently not available) and those eligible will be approached by HMRC to complete this. This is based on data they already hold on file.
It’s anticipated that the scheme will be accessible by June with eligible self-employed people receiving a taxable lump sum of three months backdated support directly from HMRC.
If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-2019, you must do this by 23rd April.
If you would like help preparing your 2018-19 tax return use our sister company 2020 Accountancy would be happy to help.