Long-awaited news of the support available to the self employed during the coronavirus pandemic is available.

Cash grants will be paid, equating to 80% of profits, up to £2,500 per month for at least three months. The total involved will be paid via a single payment directly into each individual’s bank account.

The amount involved for each person will reflect their average monthly trading profit. At the moment, it is unclear how capital allowance claims will be treated in this calculation. This will be calculated using self assessment tax return information from the last three years – or less for newer self employed people.

Anyone who has not submitted the tax return due on 31 January this year now has four weeks to do so, enabling the last tax year’s figures to be considered within the calculation of the grant.

This support is in line with the support for employees, whereby the government will pay up to 80% of salaries for furloughed workers. It also applies to members of partnerships.

Chancellor Rishi Sunak is confident that the new support package will cover 95% of self employed individuals.

Those who pay themselves a salary and dividends through their own company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.

How do you claim this support?

No action is needed at the moment. HMRC will contact all those who are eligible to invite applications.

Payments are not expected until June, not least because those who have not yet submitted their self assessment tax return have been given four weeks to do so.

Full details for the support scheme for self employed individuals is here.

It’s good to talk…

Would you value a free 10-minute chat with Emily to discuss how COVID-19 is affecting your business, please book a time here.