FAQs for the self employed
- First Published: 27th March
Last Updated: See below
As we get answers to questions (or have new advice), we’ll add them here and send out a WhatsApp broadcast, so we can help as many people as possible. Follow this link to join the broadcast list: http://www.loveaccountancy.co.uk/how-to-get-added-to-our-whatsapp-broadcasts/
In progress FAQs:
We’re currently working on these questions (answers will be posted below and updated by WhatsApp):
*New* Self Employed Government Support (announced 26th March 2020):
*NEW* See this support page for application details: SEIS
HMRC will contact you and ask you to complete a form.
Once accepted, you’ll be made a payment directly into your bank account – early June is the Gov advice
Other funding or support may be needed in the mean time (Universal Credits, Business Interruption Loan, Tax Payment Deferral, Mortgage/Rent holidays)
- 80% of your average profits from self employment (3 year tax return average – 2016/17 2017/18 2018/19)
- You’ll receive the payment in one lump payout
- Initial grant covers 3 months to 31 May 2020
- Grant up to £2,500 per month
- If not got 3 years tax return, grant will be calculated on the years you have submitted
- Grant back dated to 1 March 2020
- This is a taxable grant, but is non-repayable
- You can still work and claim (clarity on the work you can do is not published – whether this is just answering phone and emails, or physically doing and invoicing for work)
- Individuals and partnerships
- You have submitted a Personal Income Tax Return for 2018/19
- You traded in the tax year 2019/20
- You are still trading when you apply, or would be expect for COVID-19
- You intend to continue to trade in the tax year 2020/21
- Have lost trading/partnership trading profits due to COVID-19
- Average profits must be less than £50,000
- If you started trading after 5th April 2019 you cannot claim (to protect against fraudulent claims)
- If average profits are over £50,000
- Directors (dividends don’t count) – who now have to claim their salary through the Job Retention Scheme grant
Apply for universal credits if your not eligible for this grant
FAQs moved from main FAQ page:
Freelancers (director only company) and Self Employed:
Self Employment summary
– 80% of profits up to £2500/month cap
– Profits on 3yrs average, nothing if this is over £50k
– Must have submitted a self employment tax return for 2018/19
– Payment by June (sounds like it will be backdated)
– Cashflow in the meanwhile should be plugged by business interruption loans, tax deferral, and Universal credit – also looking at loan repayment holidays, rent or mortgage holidays
– Apparently you can still keep working? TBC
Watch Martin Lewis on ITV at 20:30 26th March
Update: Dividends don’t count. Directors to claim through PAYE, if they can’t work.
Partnerships covered under self employed support.
Hearing that some people are struggling to get accepted for universal credits due to having savings over £16,000. Hopefully this issue will be addressed tonight for self employed people. If you’ve tried to make a claim under universal credits, please let us know what your experience has been.
Here we’re looking at the grant of £10,000 promised by the Government for business that pay little or no business rates. Link
If you work from home, then our current answer and belief is that you can’t get this grant as you don’t have a premises registered for business use. Done this way so you don’t have to change the use of your home and loose Capital Gains Tax relief when the property is sold.
You are eligible if:
- your business is based in England
- you are a small business and already receive SBBR and/or RRR
- you are a business that occupies [business] property
I think this should read business property, as inserted above.
Updates: You need to be registered for business rates to get this grant (the business equivalent to council tax)
There’s currently very little released about this. So we’ll update as we find the right info.
The current advice is that you can apply for universal credits. You can do that here: https://www.gov.uk/apply-universal-credit
- The minimum income floor for universal credits (or working tax credits) is suspended
- The result being that anyone can apply for universal credits or working tax credits
- You’ll be eligible for the Statutory Sick Pay rate of £94.25 per week
We think you might be able to apply for this even if you do trade through a Limited Company, but we’ll update on this when we have the answer.
Updates: See announcements for 27th March 2020 for government support to the self employed