Reed Smith Client Alerts

Having delivered the historic 80% salary underwrite for the employed, he has now delivered a similar 80% underwrite for the self-employed.

Incredible stuff really.

Authors: Gareth Amdor

group of coworkers going down stairs

So what’s the package this time?

First up, it’s only open to those with trading profits up to £50,000 and who also earn the majority of their income from self-employment.

That will cover 95% of the self-employed - so significant coverage.

The detail...?

  • A taxable grant to cover 80% of average monthly profits over the last three years - capped at £2,500 per month;
    • If you only have one year of trading they will accept that but not less.
  • It will be open for 3 months, though as with the employed scheme he may extend it;
  • The money will be available from the beginning of June;
  • You have to be self-employed now and have filed a 2019 tax return to that effect;
  • Where a person qualifies, HMRC will contact them and they will then be asked to file a form online to claim their grant; and
  • There will be a 4 week grace period for late filers of their January tax returns to file those returns and so qualify for the scheme.

The Chancellor also strongly suggested that once this pandemic is over, given the employed and self-employed have basically been bailed out “the same”, there would then likely be renewed focus on levelling the playing field between the amount of National Insurance Contributions paid in respect of the employed compared to the self-employed – the self-employed pay less.