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Saturday, Feb 22, 2025

What self-employment income support is available?

What self-employment income support is available?

Chancellor Rishi Sunak today outlined his Winter Economy Plan to help protect jobs and mitigate the damage to the economy caused by the coronavirus outbreak.

This includes the new furlough scheme replacement, which will see the Government and employers pay two-thirds of employee’s salaries.

The measures have been put in place to help save jobs as Britain prepares for a possible second national lockdown.

But what measures has the Chancellor put in place to support self-employed workers?

What support is available for self-employed workers?


Rishi Sunak announced today that he is extending the self-employed grant scheme, a move that will help thousands of small businesses.

The new self-employed grant will cover 20% of average monthly profits, up to a total of £1,875, spanning November to January next year.


New plans have been put in place to protect small businesses


An additional second grant will also be available for self-employed workers to cover February 2021 to the end of April.

The Government hasn’t yet confirmed how much this second grant will cover, but have said it ‘may be adjusted to respond to changing circumstances.’

The new batch of self-employment grants are nowhere near as generous as the previous two.

In the first round of grants, eligible people got a taxable grant worth 80% of their average monthly profits over the last three financial years.

The grant – paid in a lump sum in June covering March, April and May – was capped at £2,500 a month, or £7,500 in total.

In the second round in August, eligible people got 70% of their average monthly profits, capped at £2,190 a month.

Only those eligible for the current SEISS scheme can qualify for the self-employment grants.

So, you must have filed a tax return for 2018/19, must earn more than 50% of your total income from self-employment and your average trading profit must be no more than £50,000 per year.

Additionally, you need to have been adversely affected by coronavirus to claim. For example, your company must have suffered from reduction in trade, staff illness or extra PPE costs.


Rishi Sunak announced that he is extending the self-employed grant scheme


What other measures did Rishi Sunak announce?


The Chancellor also announced:

*  The hospitality and tourism industry’s VAT cut will be extended until March next year

*  The coronavirus emergency loans for businesses will be extended until the end of the year – and loans can be repaid over ten years

*  Businesses who are struggling to pay back their loans can make interest-only payments

*  Firms can spread their VAT bill over 11 smaller payments to make it easier for them to cough up the cash owed – and no interest

*  People making self-assessment claims can extend their tax bills for another year

Small businesses are also eligible to apply for the Job Support scheme, which will replace furlough.

The scheme is available to employees who work and are paid for at least one-third of their normal hours.

The Government, together with employers, will then cover the final two-thirds of pay.

Speaking at the House of Commons, Mr Sunak said: ‘The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve.’

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