The Government has now announced financial support measures for the self-employed to combat loss of income due to the Coronavirus pandemic.
Here's What We Know:
- It is based on your taxable profits in the three years to 5th April 2019
- It is available if your profit is less than £50,000 per year
- You will receive 80% of your average monthly earnings over that period up to £2,500
- Payment to be made initially for the three months, March to May i.e. 3/12th of your average annual earnings
- It will be paid in June 2020
- It comes in the form of a grant by which they mean in effect it is a gift to you, it is not repayable but it will form part of your taxable income
Your self-assessment tax payment due on 31st July 2020 is optional. You can roll it into the payment on 31st Januart 2021, but you will need to pay it eventually, so it is important that if you defer it you continue to budget for this payment
The self-employed grant will be released in June 2020, between now and then the government advice is:
- Take a three month mortgage holiday
- Get a government sponsored loan from your bank
Who It Does Not Cover
- Those whose taxable profits are higher than £50,000 on average over the three years to 5th April 2019. There is no taper, it is an all or nothing rule.
- Those who earn through a limited company – you may be able to furlough your salary if you do no work
- If you started your trade after 5th April 2019
- You have lost no income due to the virus
What if I don’t have 3 years trading?
If you do not have three years to 5th April 2019, your income will be averaged over the period you actually traded.
We are here to help
We apprecaite these are very difficult times and are happy to help with any advice. Stay safe!
The DRN Team