With the Coronavirus Self-Employment Income Support Scheme due to open next week, the self employed have started to receive emails, text messages, and in some cases phone calls, to invite them to apply for a grant through the scheme.
We know that many marketplace sellers are self employed, and the Coronavirus Self-Employment Income Support Scheme is intended to assist those who have LOST money due to the Coronavirus pandemic. This isn’t intended to be a Brucie Bonus free money scheme, so you should only apply if your income has suffered due to the pandemic – not just because your business wasn’t very profitable in the first case.
The Coronavirus Self-Employment Income Support Scheme grant will be based on your last three year’s tax returns (or fewer years if you are only recently registered as self employed). There will be a taxable grant of 80% of your average monthly trading profits, capped at a maximum of £7,500 for the three months of March, April and May. If you successfully apply the cash should be in your account within about 6 days of approval.
If you wish to take advantage of the Coronavirus Self-Employment Income Support Scheme, you should initially use the Government checker to see if you qualify. You will need your Self Assessment Unique Taxpayer Reference and your National Insurance number. To complete your claim you will also need your Government Gateway user ID and password and bank account details.
Qualification for Coronavirus Self-Employment Income Support Scheme
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 trading average trading profits are less than £50,000 per year
- You must have submitted your tax returns
What does ‘adversely affected by coronavirus’ mean?
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 in to work
Who should NOT be claiming under the Coronavirus Self-Employment Income Support Scheme
If you have not lost money because your business continued trading (or could have), then you should not be claiming under the Coronavirus Self-Employment Income Support Scheme. It is also not intended to support failing businesses that would have failed regardless of the pandemic.
While the government and HMRC haven’t revealed the exact compliance steps they may be taking, they may take a dim view if you apply for funds and it transpires your business wasn’t adversely affected by the coronavirus. For those who submitted their tax returns late, HMRC have already said that they will be carrying out additional fraud checks so expect your affairs to be closely examined if that is you.
An HMRC Spokesperson confirmed to Tamebay that they already have the powers they need to tackle any fraudulent claims:
“We are building checks into the self-employment support scheme to prevent fraud. Only those already known to HMRC through tax return data as self-employed will be able to apply.
We already have a wide range of statutory and common law powers to tackle fraud and criminality, which will be used.”
– HMRC Spokesperson
When can I claim the Coronavirus Self-Employment Income Support Scheme grant?
If you complete the online tool to find out if you’re eligible to make a claim, you will be given a date randomly assigned between the 13th and 18th of May 2020 to complete your claim. If you are successful, funds will be paid into your bank account six days later.
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