What help are you entitled to?
Following government announcements over the past few weeks, we now have a little bit more clarity on what help will be available for all. We have summarised help for individuals below. Please check out our other blog post on help for Sole Traders/Companies with Premises & staff here.
For Self Employed
There will be a grant fund available for self employed individuals. The funds will not be available until at least June.We would strongly advise you to apply for Universal Credit, to bridge the gap between now and June. Universal Credit is available based on individual circumstances. It must be a joint claim if you live with your partner. More information can be found here: https://www.gov.uk/universal-credit
To qualify for the self employed grant, you must:
- have submitted your Income Tax Self Assessment tax return for the tax year 2018-19
- traded in the tax year 2019-20
- are trading when you apply, or would be, except for COVID-19
- intend to continue to trade in the tax year 2020-21
- have lost trading/partnership trading profits due to COVID-19
- Have trading profits below £50,000
- Self employed income must account for more than 50% of your overall income
How much you’ll get
You’ll get a taxable grant which will be 80% of the average profits from the tax years (where applicable):
- 2016 to 2017
- 2017 to 2018
- 2018 to 2019
To work out the average, HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 36 (where applicable), and use this to calculate a monthly amount.
It will be up to a maximum of £2,500 per month for 3 months.
Early advice from HMRC indicates this help will be available from June 2020.
Currently, the only help available for directors, is the CoronaVirus Job Retention scheme through your PAYE scheme.
HMRC will reimburse 80% of wages, provided you cannot work in the business, up to £2,500 per month.
You must have been on the PAYE scheme in February 2020
The portal for claiming this should be available towards the end of April.
For both Sole Traders & Directors
You are able to defer VAT payments due from 20th March 2020 – 30th June 2020. Simply cancel you Direct Debit (If you have one). You will automatically qualify for this. Any deferred VAT will need to be repaid by 31st March 2021.
Self Assessment tax due on 31st July 2020, can be deferred as well. This would need paying by 31st January 2021.
Also, the CoronaVirus Business Interuption Loan Scheme is available to Limited Companies, Sole Traders & Partnerships. More information can be found here: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/