Coronavirus Support for the Self-Employed

Will you qualify for the Self-employment Income Support Scheme?

Take a look at HMRC’s guidance on how to work out your total income and trading profits. 

Who is eligible to get the grant?

Self-employed individuals are eligible for a taxable grant representing up to 80% of average profits if their 2018/19 trading profits were less than £50,000 and account for more than half of their taxable income. If 2018/19 profits don’t meet the requirements then individuals can still qualify by using the average of 2016/17, 2017/18 and 2018/19 trading profits.

Calculating trading profits

HMRC has confirmed that it will use the figures on personal tax returns for total trading income (turnover), then deduct any allowable business expenses and capital expenditure. This is the trading profit after all expenses including flat rate expenses, the trading allowance and capital allowance claims, but before taking off the personal allowance. If trading losses from previous years were used to reduce the trading profit, HMRC will ignore the loss relief claim. This means that an individual can still get the grant even if they didn’t pay tax on profits due to loss relief. However, if a trading loss was made during 2016/17, 2017/18 or 2018/19, then it will reduce the average trading profits and the grant.

How do you apply? 

HMRC will contact you if you are eligible and invite you to apply online. The maximum amount is £2,500 per month for three months, so to get the full amount you would need to have average profits of at least £37,500 per annum. The payments are expected to be made in June 2020.

Be aware of scams!

As HMRC will be contacting you, please be extra vigilant about ensuring you’re not being tricked by fraudulent emails. HMRC will never text, email or phone to ask for bank details, PIN or passwords. HMRC are very aware that scammers will be taking advantage of these ongoing circumstance and have shared the following advice: “If you receive an email, text or call claiming to be from us that asks you to click on a link or give information such as your name, credit card or bank details, it’s a scam.”

Do not:

  • Give out private information
  • Reply to text messages
  • Download attachments
  • Click Links

HMRC has put together a list of examples of Coronavirus (COVID-19) scams in different formats so you can be aware of what to watch out for:

If you do receive any communications you are unsure of please get in touch with us by calling 01243 782 423 and our team will be happy to help!