COVID-19 Self-employment support /financial Grant

Self-employed workers will be able to apply for taxable grants worth up to 80% of their average monthly profits to combat loss of income due to the coronavirus pandemic, the Chancellor announced on Wednesday 25 March 20.

The Chancellor confirmed that self-employed people across the UK will be able to get an amount equivalent to 80% of their income, based on their average monthly profits – again, up to a maximum of £2,500 a month.

Grants will start to be paid at the beginning of June, as a taxable lump sum covering March, April and May. The scheme is set initially to cover these three months but the Chancellor has said it may be extended.

Here are the requirements you should meet to apply

  • 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

Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment. (e.g. if your income is made up of different sources, your self-employment income should be more than a half your total income)

Your income is going to be determined by one of the following criteria

  • having trading profits in 2018-19 of less than £50,000 and filled. These profits should constitute more than half of your total taxable income
  • having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period

To work out the average HMRC will add together the total trading profit for the 3 tax years (2016-17, 2017-18, and 2018-19). (where applicable) then divide by 3 (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.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way.

How to apply

You cannot apply for this scheme yet.

HMRC will contact you if you are eligible for the scheme and invite you to apply online.

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