What did Rishi mean I get 80%?
The government has at last announced a package of support for self-employed individuals and clarified more about how to access the coronavirus job retention scheme.
Let’s start with the Coronavirus Job Retention Scheme:
In terms of the clarified advice on the Coronavirus Job Retention Scheme, we have learnt:
You can claim for any employees who have been PAYE on your payroll including part-time or full-time employees, flexible or zero hours employees, employees on agency contracts who are now NOT working
If the employee is currently on Statutory Sick Pay, e.g. because they are self-isolating, they are not eligible for the scheme until they have come off Statutory Sick Pay
You will get a grant for the wages you will pay out to Furloughed employees
The “up to £2500 per month” is actually “up to £2500 per month + associated Employer NI contributions, and minimum enrolment employer pension contributions on that wage”
The scheme is not yet live, but when it is we will be in contact for how you can make a claim.
Further details can be found here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
A quick summary of the grant being made available for self-employed individuals:
Self-employed individuals will be eligible of a taxable grant up to £2500 per month for at least 3 months, which will be equal to 80% of their profits. And the self-employed can carry on working to access this grant. So far so good. But with all these things there are caveats, namely:
If you are a director of a limited business, or operate through a personal services company then this scheme does not apply to you
You need to have a trading profit of less than £50, 000 in 2018-19 or an average trading profit of less than £50,000 from 2016/17, 2017/18 and 2018/19.
More than half your income in these periods must come from self-employment. If you started trading between 2016 – 2019, HMRC will only use the years that you filed a self-assessment tax return
You need to have submitted your personal tax return for 2018/19 (and if you haven’t you must do so by April 23rd 2020)
You have been trading in 2019/2020
You need to have lost money due to COVID-19