Self-Employed Income Support Scheme

Friston Wicks, Chartered Accountant and Chartered Tax Adviser
Self-Employed Income Support Scheme
Self-Employed Income Support Scheme
7th October 2020 Debbie

So far there have been 2 grants paid out under this scheme and a further 2 expected.

Eligibility for the first 2 included requirements that:

  1. you are self-employed and submitted a 2018-29 tax return;
  2. trading at the date of application, or would be except for COVID019;
  3. intended to continue to trade in 2020-21; and
  4. have lost profits due to COVID-19
  5. In addition – your annual profits must be < £50k – based on your profits for the year ended 5 April 2019 or the average of the 3 years ended 5 April 2019; and your profits, calculated above, are > 50% your taxable income.
For the first grant you had to confirm that you were affected on/before 13 July 2020 and claim 80% of average profits for the 3 years ended 5 April 2019 for 3 months to a maximum of £2,500 per mth.
For the second grant you had to confirm that you were affected on/after 14 July 2020 and claim 70% of average profits for the 3 years ended 5 April 2019 for 3 months to a maximum of £2,190 per mth.
Eligibility for the 3rd and probably the 4th grants, are calculated on a similar basis but you need to declare:
  • You are actively trading and intend to continue to trade, but facing reduced demand due to COVID-19, in the qualifying period;
  • The qualifying periods are November 2020 – January 2021 for the 3rd grant and February 2021 to April 2021 for the 4th; and
  • The 3rd grant being 20% of average profits, calculated on a similar basis as above, capped at £625 per mth and the 4th grant % is yet to be decided.

Note to claim a grant you do not need to have claimed previous grants.

So, the requirements for the 3rd and potentially the 4th grants mean that there is a requirement to be actively trading so businesses that have had to close during the pandemic will not be able to claim if they have not re started during the qualifying period.

It is understood that this policy decision is designed to ensure that only viable businesses are supported and to align the scheme with the Job Support Scheme.

More will be posted when I have heard further.

Whilst there has been no comment on comparing actual profits for 2020-21 to earlier years to question eligibility, it would be advisable keep notes of the basis on which you consider you have lost trade due to COVID-19, in the relevant period, so that it can support any claim should questions be asked later.

So far there has been no quantification of “being affected by COVID-19”.

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