Updated 5th May 2020
If you are self-employed or a member of a partnership and have been adversely affected by coronavirus, find out if you can use this scheme to claim a grant.
The scheme will allow you to claim a taxable grant of 80% of your average monthly trading profits, paid out in a single instalment covering 3 months, capped at £7,500 in total. This is a temporary scheme, but may be extended.
If you receive the grant you can continue to work, start a new trade or take on other employment including voluntary work.
The grant will be subject to Income Tax and self-employed National Insurance.
HMRC will work out if you are eligible for the scheme and how much grant you may get. You can follow these steps to help you understand how HMRC will do this and what you can do now.
Who can claim
You can claim if you are a self-employed individual or a member of a partnership and:
- you traded in the 2018/19 tax year and submitted your Self Assessment tax return on or before 23 April 2020 for that year
- you traded in the 2019/20 tax year
- you intend to continue to trade in the 2020/21 tax year
- you carry on a trade which has been adversely affected by coronavirus
Your business could be adversely affected by coronavirus if, for example:
- you are unable to work as you:
- are shielding
- are self-isolating
- are on sick leave because of coronavirus
- have caring responsibilities because of coronavirus
- you have had to scale down or temporarily cease trading as:
- your supply chain has been interrupted
- you have fewer or no customers or clients
- your staff are unable to come in to work
You should not claim the grant if you are above the state aid limits or operating a trade through a trust.
To work out your eligibility HMRC will initially look at your 2018/19 Self Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income (pensions, rental income etc.)
If you are not eligible based on your 2018/19 Self Assessment tax return, HMRC will then look at the tax years 2016/17, 2017/18 and 2018/19. Grants under the Self-Employment Income Support Scheme are not counted as ‘access to public funds’, and you can claim the grant on all categories of work visa.
Find out how HMRC will work out your eligibility.
Grants under the Self-Employment Income Support Scheme are not counted as ‘access to public funds’, and you can claim the grant on all categories of work visa.
Your tax agent cannot make the claim for you. You must make the claim yourself. If you use an agent you should contact them if you need any help or support.
How different circumstances affect the scheme
Check if your circumstances affect your eligibility, for the following:
if your return is late, amended or under enquiry
- if you are a member of a partnership
- if you are on or took parental leave
- if you have loans covered by the loan charge
- if you claim averaging relief
- if you are non-resident or chose the remittance basis
- if you are above the state aid limits
Check if you are eligible to claim
You can use HMRC’s online tool to find out if you’re eligible to make a claim. Your tax agent can also use the online tool on your behalf.
You’ll need your:
- Self Assessment 10 digit Unique Taxpayer Reference (UTR) number
- National Insurance number
Please be aware that HMRC online services may be slow during busy times.
If you are eligible
HMRC will tell you the date you’ll be able to make a claim from and ask you to add your contact details via the government gateway. HMRC will use your contact details to remind you when the online service will be available.
If you are not eligible
If HMRC has told you that you are not eligible to make a claim, you can ask HMRC to review this.
How much you’ll get
You’ll get a taxable grant based on your average trading profit over the 3 tax years:
HMRC will work out your average trading profit by adding together your total trading profits or losses for the 3 tax years, then divide by 3.
The grant will be 80% of your average monthly trading profits, paid out in a single instalment covering 3 months, capped at £7,500 altogether. The online service will tell you how HMRC calculated the grant.
Find out how HMRC will work out your average trading profits including if you have not traded for all 3 years.
How to claim
The online service will be available from 13 May 2020. If you’re eligible, HMRC will tell you the date you can make your claim from. If your claim is approved you’ll receive your payment within 6 working days.
If you’re unable to claim online an alternative way to claim will be available. HMRC will provide further details shortly.
You do not need to contact HMRC now, as this will only delay the urgent work being undertaken to introduce the scheme.
If you receive texts, calls or emails claiming to be from HMRC, offering financial help or a tax refund and asking you to click on a link or to give personal information, it is a scam. You should email it to email@example.com and then delete it.
When you make your claim
You will need your:
- Self Assessment UTR number
- National Insurance number
- Government Gateway user ID and password – if you do not have a user ID, you can create one when you check your eligibility online
- bank account number and sort code you want HMRC to pay the grant into (only provide bank account details where a Bacs payment can be accepted)
You’ll have to confirm to HMRC that your business has been adversely affected by coronavirus.
If you claim the grant HMRC will treat this as confirmation you’re below the state aid limits.
HMRC will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate.
After you’ve claimed
Once you’ve submitted your claim, you will be told straight away if your grant is approved. We will pay the grant into your bank account within 6 working days.
You must keep a record of:
- the amount claimed
- the claim reference number
- evidence that your business has been adversely affected by coronavirus
You will need to report the grant:
- on your Self Assessment tax return
- as self-employed income for any Universal Credit claims
- as self-employed income and that you’re working 16 hours a week for any tax credits claims
Other help you can get
Get other financial support
You can make a claim for Universal Credit while you wait for the grant. The grant may affect the amount of Universal Credit you get, but will not affect claims for earlier periods.
The Government is also providing the following help for the self-employed:
- deferral of Self Assessment Income Tax and VAT payments
- grants for businesses that pay little or no business rates
- Business Interruption Loan Scheme
- Bounce Back Loan
If you have concerns or questions, please contact us on 01932 830664 or a member of the WardWilliams Creative team. As further details are announced, we will keep you informed.