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The Government has announced that it will tell self employed people earlier than expected if they will qualify for its income protection scheme.
The Government has announced that it will start letting self employed people know from this week whether they are eligible for the new Self-Employment Income Support Scheme.
The scheme, which will start paying out in June, will allow self employed people or members of a business partnership to claim a taxable grant worth 80% of their average trading profits up to a maximum of £7,500, equivalent to three months’ profits.
The scheme is open to self employed people whose income has been affected by the coronavirus and who have submitted your tax return for the tax year 2018-19. It runs parallel to the furlough scheme for employees and aims to ensure self employed people stay afloat in the current crisis. Eligibility can be checked here.
Andy Chamberlain, Director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed), said: “It is excellent news that the government will tell people early if they are eligible for the Self-Employment Income Support Scheme (SEISS). This is unexpected and welcome given just how complex it is to implement a new initiative on this scale. We hope the government will also bring forward the payment date, to get money into these struggling self-employed businesses as soon as possible.”
He added that IPSE would like to see other measures introduced for limited company contractors, the newly self-employed and those who have earned just over £50,000 p/a.
Also, today, the Government opened its Bounce Back Loan scheme for applications. Under the scheme for SMEs, which will be delivered through a network of accredited lenders, businesses can borrow between £2,000 and £50,000. The government will guarantee 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. The loan terms will be up to six years and the government says it will work with lenders to agree a low rate of interest for the remaining period of the loan.
Banks have, however, expressed concerns that the scheme may put them in breach of rules from the Prudential Regulation Authority, the Financial Conduct Authority and the Consumer Credit Act if loans are defaulted because proper checks have not been done.
The Government has also created a toolkit for its small business grants. A new discretionary fund has also been announced, which will help small businesses with ongoing fixed property related costs.
And it has announced that tax credits will continue to be paid even if people are working fewer hours or furloughed due to COVID-19.