The Office for National
Statistics (ONS) estimates that just over 5 million
people (15% of the UK workforce) are self-employed. The
Government says the Self-Employment Income Support Scheme
(SEISS) will cover 95% of people who get the majority of
their earnings from self-employment. The Institute for Fiscal
Studies (IFS) estimates that just 62%
of all self-employed individuals will
be covered.
HMRC has issued
guidance on the Scheme that says:
- The scheme targets self-employed people or members of a
partnership who have lost trading/partnership trading profits
due to Coronavirus outbreak.
- This scheme will pay direct cash grants to self-employed
workers worth 80% of their profits, up to £2,500/month for
three months, and may be extended “if necessary”.
- You cannot apply for this scheme yet. HMRC will contact
individuals it ascertains as being eligible for the scheme.
They will then be invited to apply online. The Government has
asked that people not contact HMRC to enquire about this
support at this stage, as this will likely slow down the
overall process.
- The cash grant will be paid in a lump sum (worth up to
£7,500) for the three months.
- Eligibility is limited to those people:
- who are currently self-employed
- submitted a tax return for 2018/19
- make the majority of their income (over 50%) from
self-employment
- whose average earnings are less than £50,000 in the
years in which they traded in the period 2016-19
- The scheme will not apply to those who operate under a
company structure and take dividends. The IFS says there are
around 2 million of these owner-managed companies.
