If you are self-employed or a member of a partnership adversely affected by coronavirus (COVID-19), you may be able to use the Self-Employment Income Support Scheme to claim a grant.
The scheme will allow you to claim a taxable grant of 80% of your average monthly trading profits over the 3 tax years 2016/17, 2017/18 2018/19, paid out in a single instalment covering 3 months and capped at £7,500. This is a temporary scheme but may be extended.
If you receive the grant you can continue to work, start a new trade or take on other employment including voluntary work, or duties as an armed forces reservist.
The grant will be subject to Income Tax and self-employed National Insurance.
Please find below information about how to access the HMRC system and the information you will need to have ready to make a claim when the system goes live today, Wednesday 13th May.
If you are eligible, HMRC will tell you the date you can make your claim from and if approved, you should be paid within 6 working days.
Who can claim
You can claim if you’re a self-employed individual or a member of a partnership and:
• you traded in the tax year 2018 to 2019 and submitted your Self-Assessment tax return on or before 23 April 2020 for that year
• you traded in the tax year 2019 to 2020
• you intend to continue to trade in the tax year 2020 to 2021
• you carry on a trade which has been adversely affected by coronavirus
Your business could be adversely affected by coronavirus if, for example:
– you’re unable to work because you:
• are shielding
• are self-isolating
• are on sick leave because of coronavirus
• have caring responsibilities because of coronavirus
– you’ve had to scale down or temporarily stop trading because:
• your supply chain has been interrupted
• you have fewer or no customers or clients
• your staff are unable to come into work
To work out your eligibility, HMRC will first look at your 2018 to 2019 Self-Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.
If you are not eligible based on your 2018 to 2019 Self-Assessment tax return, HMRC will then look at the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019.
You can use the online tool to find out if you are eligible to make a claim. Alternatively, we can use the online tool to check your eligibility on your behalf.
How to claim
The only way to claim is online using your Government Gateway user ID and password. If you do not already have a Gateway account you can create one when you check your eligibility online.
You will also need your:
1. Self Assessment Unique Taxpayer Reference (UTR) number – if we act for you we will have this in our records, otherwise, if you do not have this find out how to get your lost UTR number:
2. National Insurance number – if we act for you we will have this in our records, otherwise, if you do not have this find out how to get your lost National Insurance number:
3. Bank account number and sort code you want HMRC to pay the grant into (only provide bank account details where a BACS payment can be accepted).
You will have to confirm to HMRC that your business has been adversely affected by coronavirus.
If you claim the grant, HMRC will treat this as confirmation you are below the state aid limits.
HMRC will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate.
If you would like help with this please contact us.
After you have claimed
Once you have submitted your claim, you will be told straight away if your grant is approved. HMRC will then pay the grant into your bank account within 6 working days.
You must keep a copy of all records in line with normal self-employment record keeping requirements, including:
• the amount claimed
• the claim reference number for your records
• evidence that your business has been adversely affected by coronavirus
You will need to report the grant:
• on your Self-Assessment tax return
• as self-employed income for any Universal Credit claims
• as self-employed income and that you’re working 16 hours a week for any tax credits claims
If you would like further help or advice please contact us.