Self-employed: financial help if you’ve lost business income

If you are self-employed or a member of a partnership and have lost income due to Coronavirus you can apply for Self-employment Income Support – a grant which you don’t need to pay back –provided your business meets certain conditions. Whether or not you’re eligible, there is also other financial support available.

Need to know

To qualify for Self-employment Income Support you must:

  • have submitted a Self-Assessment tax return for the tax year 2018/19 and traded in the tax year 2019/20 and intend to trade in 2020/21

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  • be trading when you apply, or would be except for Coronavirus
  • have lost trading/partnership profits due to Coronavirus
  • have earned more than half of your average taxable income from self-employment in the period or periods above.

And:

  • have had average annual trading or partnership profits of less than £50,000 across the two or three tax years up to and including 2018/19

or

  • if you haven’t been trading that long, average profits of less than £50,000 in tax year 2018/19.

How much will you get?

  • You’ll get a taxable lump sum grant of 40% of your average monthly profits, up to £3,750, will cover the period from November 2020 to January 2021.
  • A second grant will run from February to April 2021 although the amount you get might differ.

From when?

  • The grant for June to August must be claimed on or before 19 October 2020.
  • Details on when you’ll be able to apply for further grants will be announced soon.

How do I get it?

  • HM Revenue & Customs (HMRC) aims to contact all people who are self-employed or in partnerships and meet the above criteria by mid-May explaining how to make an online application if your income has been affected.
  • Important: you will access this scheme only through GOV.UK. If someone texts, calls or emails claiming to be from HMRC, saying you can claim financial help or are owed a tax refund do not offer any details or click on any links. It will be a scam.

Useful to know

  • Self-employment Income Support is a taxable grant, so you will have to declare it on your next Self-Assessment tax return and might have to pay income tax and National Insurance on it.
  • You may be able to claim Universal Credit while waiting for Self-employment Income Support to be paid, however this will depend on household income and savings. For example, if you and your partner/spouse have savings over £16,000 you won’t be eligible. Your partner/spouse’s income will also be taken into account. Bear in mind as well that the grant will need to be declared as income. This could significantly reduce or remove the next Universal Credit payment you are entitled to.
  • If you’re self-employed, but took time off during 2018/19 to care for new children, or a newly adopted child, can still claim through the scheme. You will be assessed on either your 2017/18 tax return or your 2016/17 and 2017/18 tax return.

Action to take

  • If cashflow is an immediate problem, check out Universal Credit and other benefits that you may qualify for while waiting for Self-employment Income Support.
Find out more about the income support scheme and the benefits you might claim if you’re self employed.

Not eligible

Other help

There is other help available if you’re having trouble with housing costs, bills, loans and credit cards.

Find out what’s available to help you with your housing costs.
Learn what assistance there is to help you with household bills.
Discover what help you can get with loans, credit cards and other borrowing.

More support if you’re self-employed

  • If you’re registered for VAT and deferred its payments, this can be spread over 11 smaller interest-free payments during the 2021/22 tax year. Read about VAT deferral on GOV.UK.
  • Self Assessment tax return payments deferred from July 2020 and due in January 2021 can be deferred until January 2022.
  • If you are in the retail, hospitality or leisure sector you qualify for a business rates holiday for the 2020/21 tax year. This will be applied automatically.
  • If your business premises have a rateable value below £51,000 you may qualify for cash grants of between £10,000 and £25,000. Read about business grants for small businesses on GOV.UK.
  • Small businesses can access loans of between £2,000 and £50,000 through the Bounce Back Loan Scheme. These are interest free for 12 months and no repayments will be due during this time.
  • If you need to access finance, you may be able to get support through the government’s Coronavirus Business Interruption Loan Scheme. Learn about the Coronavirus Business Interruption Loan Scheme on GOV.UK.
  • If you have personal or business debts, contact the free advice service in your area: Business Debtline (England and Wales) or Business Debtline (Scotland) or Advice NI Business Debt Serviceopens in new window (Northern Ireland).

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