Government provides more detail on help for the self-employed
The Government has announced details of financial support for the self-employed through the Self-Employed Income Support Scheme (‘SEISS’) via a Direction from the Treasury to HMRC (in the same way as the Job Retention Scheme).
The SEISS applies to persons who (amongst other things):
- carry on a trade the business of which has been adversely affected by reason of circumstances arising as a result of coronavirus or coronavirus disease,
- have delivered a tax return for a relevant tax year on or before 23 April 2020,
- have carried on a trade in the tax years 2018-19 and 2019-20,
- intend to continue to carry on a trade in the tax year 2020-21, and
- are an individual.
Applicants also have to meet the ‘profits condition’. There are various criteria that can be satisfied to meet the ‘profits condition’ but, put broadly, the applicant needs to have an income (i.e. a profit before tax) of under £50,000 per annum.
The calculation of the amount of the grant (referred to as a SEISS payment) is even more complex but, in essence, it’s the lower of £7,500 or 80% of 3 months earnings. Interestingly, the applicant does not have to give credit for any income that they have received so, even though their lost income may be relatively small, they can still qualify for the maximum amount of the payment.
Click here to read the official Direction.
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All information in this update is accurate at the time of writing. It is meant for general information only and is not legal advice.