Millions of self-employed individuals across the UK can
apply for the scheme to receive grants at a maximum of £2500 per month
The coronavirus epidemic has been particularly tough for self-employed workers who rely on regular work to get income. UK Chancellor Rishi Sunak has recently announced that the UK’s self-employed can apply for grants worth 80% of their monthly profits to help them cope with the financial impacts of coronavirus in a multi-billion pound support package.
The UK Chancellor unveiled the new Self-Employed Income Support Scheme yesterday, set to provide direct cash grants to the self-employed worth 80% of their average monthly trading profit over the last three year, allowing them to receive grants of up to £2500 per month. Rishi Sunak told the self-employed: “You have not been forgotten.” The scheme would cover 95% of people who receive the majority of their income from self-employment. This comes as part the government’s latest announcement to protect businesses and individuals during the coronavirus outbreak, after facing widespread criticism for failing to provide support self-employed and freelance workers in its earlier package of economic measures.
Cleaners, plumbers, electricians, musicians, hairdressers and many other self-employed people who are eligible for the new scheme will be able to apply directly to HMRC for the taxable grant, using a simple online form and the cash will be sent directly into people’s bank accounts. The grant will be paid in a single lump sum but will not begin to arrive until the start of June at the earliest.
“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,” Chancellor Rishi Sunak said. The package for the self-employed I’ve outlined today is one of the most generous in the world that has been announced so far. It targets support to those who need help most, offering the self-employed the same level of support as those in work. Together with support packages for businesses and for workers, I am confident we now have the measures in place to ensure we can get through this emergency together.”
The scheme will be open to those with a trading profit of less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19. To qualify for the scheme more than half of their income in these periods must come from self-employment. Company owners who pay themselves a salary are not covered by the scheme, but instead will be covered by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.
However, the scheme does not cover those who have become self-employed very recently and would have to look at the benefits system for support.
This is an important step the government is taking to provide support to the self-employed and reflects the brutal economic impacts a shutdown will bring to Britain’s workforce. However, there will be an extra burden placed on banks to accommodate many individuals who will resort to loans and overdrafts to get by until the grant reaches their accounts in about 10 weeks.
