Self-Employment Income Support Scheme
The Self-Employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) who have negatively financially affected by the COVID-19 outbreak.
This scheme will allow you to claim a taxable grant worth 80% of your trading profits up to a maximum of £2,500 per month for the next 3 months. This may be extended if needed.
How the scheme is designed
HMRC, the Treasury and the Chancellor have worked tirelessly to design and implement both the Job Retention and SEISS schemes. Both schemes aim to support employees and the self-employed who have been financially damaged by the Coronavirus outbreak. Both schemes also aim to provide fair, reliable and quick access to support for residents, while also avoiding potential fraud opportunities.
As such, the SEISS will be based on the most readily available and most reliable financial information HMRC has access to. For the Self-Employed this will be your annual tax returns. Unfortunately, even with the availability of this information, the SEISS can still not be ready to begin payments to residents until the beginning of June.
Can I apply?
You can apply if you’re a self-employed individual or a member of a partnership and you:
- 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. This is determined by at least one of the following conditions being true:
- having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits 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
If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.
What if I am not eligible?
I have received some correspondence from residents who have found themselves to be ineligible for SEISS. This is a difficult time for many and I am aware that missing out on this scheme is a significant disappoint.
The Government has however made further support available to help with financial pressures, with other support schemes and loans also available. The Government is also providing the following additional help for the self-employed:
- deferral of Self Assessment income tax payments due in July 2020 and VAT payments due from 20 March 2020 until 30 June 2020
- grants for businesses that pay little or no business rates
- increased amounts of Universal Credit
- Business Interruption Loan Scheme
If you’re a director of your own company and paid through PAYE you may be able to get support using the Job Retention Scheme. This does not include income earned through dividends and will only apply to the basic salary.