Assistance for the self employed
The Chancellor finally announced the much anticipated support for the self employed last night.
This is relevant to people trading as sole traders and partnerships. If you trade through a limited company, it is sadly not relevant to you!
The scheme will allow the self employed to claim 80% of their last 3 years’ average earnings to a cap of £2,500. However, if your average earnings have exceeded £50,000 there will be no assistance.
The 3 year average will be based on the 2018/19, 2017/18 and 2016/17 tax returns. You must have traded in the 2019/20 year and intend to carry on trading in 2020/21. It would appear that if you started to trade in the 2019/20 year there will be no support. If you have traded for less than 3 years the average will be adjusted accordingly.
To be eligible for support, you must earn the majority of your income from self employment, this means 50% of your income must come from your self employed source.
HMRC can identify from their systems who this scheme is relevant to. They will contact individuals and ask them to submit an online application, they have indicated this will be by June at the latest.
If you need assistance with this scheme, our partners are always available to help or find our contact details here.