Just starting out?

Register your limited company for FREE and open a Tide account today.

Get started

Self-employed: Coronavirus aid from the Government

Woman practising yoga in a home studio

Information last updated: 18:00, 26 March 2020

Chancellor Rishi Sunak has announced the Government’s plans to support self-employed people in financial difficulty due to the coronavirus crisis.

What is the Self Employed Income Support Scheme?
For how many months will you get a Self Employed Income Support grant?
Are you eligible for the Self Employed Income Support Scheme?
What do you need to do?
How can you tell if the message from HMRC is genuine?
When will you get the money?
If you’re struggling right now, what Government aid is available?
Can you still work if you get money from this Scheme?
Is this aid the same as the aid for employed workers?
Why has this taken so long?

What is the Self Employed Income Support Scheme?

The Government will pay self-employed people who have been adversely affected by the coronavirus a taxable grant worth 80% of their average monthly profits for the last 3 years, up to £2,500 a month.

For how many months will you get a Self Employed Income Support grant?

Eligible self-employed people will get a grant initially to cover three months.

Sumak stated that the Government would extend the Scheme if necessary.

Are you eligible for the Self Employed Income Support Scheme?

You’re eligible if you hit all these criteria:

  • you pay income tax in the UK
  • your trading profits each year for the last 3 years were no more than £50,000
  • the majority of your income is from self-employment
  • you are already registered as ‘self-employed’ and you submitted a tax return for the tax year 2018 to 2019

If you only started working as self-employed between 2016 and 2019, HMRC will work out your payments based on the years for which you filed a Self-Assessment tax return.

If you’re self-employed but haven’t yet filed a tax return – that is, you started your business after 1 April 2019 – you’re not eligible for this Scheme.

Sumak stated that this Scheme would help 95% of self-employed people in the UK. The Government want to make sure that this Scheme does not pay a grant to the extra 5% of self-employed people who are super-wealthy, for example top celebrities, sports professionals etc who do not need ‘aid’.

What do you need to do?

You don’t need to do anything yet.

If you’re eligible, HMRC will contact you directly. You’ll be asked to fill in a form and then they’ll pay the grant directly into your bank account. You’ll get one instalment, to cover three months.

If you missed the 31 January deadline to submit your Self Assessment tax return for the tax year 2018 to 2019, then good news: you have until 23 April 2020 to submit your late tax return and still be eligible for this Scheme.

How can you tell if the message from HMRC is genuine?

If someone emails, calls or messages you claiming they’re from HMRC and asks you to click a link or to give details (name, account number, credit card number etc), it’s a scam.

The genuine message you get from HMRC will ask you to go to the Gov.uk website.

You should always check carefully to make sure a message or call claiming to be from HMRC is genuine.

When will you get the money?

Sumak stated that eligible people will “be able to access this Scheme by no later than the beginning of June”. From this, it isn’t yet clear when HMRC will make the first payments under this Scheme.

When we have more information, we’ll update this page.

If you’re struggling right now, what other Government aid is available?

The Government has acknowledged that many self-employed people need help now. Other aid schemes open to self-employed people include:

  • Coronavirus Business Interruption Loan Scheme
    The Scheme provides finance for small businesses which have or will have their cash flow disrupted by lost or late income due to the coronavirus outbreak.
  • Deferred Self-Assessment tax payments
    Payments you were due to make by July 2020 can be deferred until the end of January 2021. You don’t need to apply and there’s no fee or interest for deferring.
  • Universal Credit
    To help during the coronavirus crisis, the Government have changed the eligibility criteria for Universal Credit so that “self-employed people can access this aid in full”.
  • Coronavirus Grants
    You might be eligible for a grant if you have a property on which you pay business rates.
  • Job Retention Scheme
    If you’re the director of your own company and you pay yourself through PAYE, you might be able to use this Scheme.

Can you still work if you get money from this Scheme?

Yes. The money you’ll get from this Scheme depends on your income from the last three years, not any income you’re making now. So you can continue to work, take on new work, take payments and so on.

Is this aid the same as the aid for employed workers?

The Chancellor claims that this Scheme is the same as the money being provided to allow employers to ‘furlough’ their workers under the Job Retention Scheme: that is, 80% of monthly income. He state this is above what many other government are paying, making it one of the most generous in the world.

Why has this taken so long?

Because as well as deciding what to offer, it wasn’t straightforward to set out who is eligible.

Addressing MPs on 25 March, Boris Johnson acknowledged it had been difficult to decide how to organise a scheme to support people who pay tax through Self-Assessment rather than the PAYE (Pay As You Earn) scheme for employees.

Johnson stated that the Government wanted to do “whatever we can to support the self-employed, just as we are putting our arms around every single employed person in this country”.

Have your say

How is the coronavirus affecting you and your small business? We’re keen to hear from you – get in touch with us on LinkedInFacebook or Twitter.

Coronavirus mailing group
Be among the first to know how to access Government aid and help from Tide.
For updates direct to your inbox, join our mailing group.

Photo by Carl Barcelo on Unsplash

Suzanne Worthington

Senior Writer

Tide Team

Join our community of entrepreneurs, freelancers and small business owners

Tide is here to help small business owners and sole traders save time and money. Take a look at our Business Current Account and get time back to focus on your business.

Get started with a modern business account

Open an account in as little as 5 minutes:

Open an account

Download on the App Store Get it on Google Play

Join our Coronavirus aid mailing group

Be among the first to know how to access Government aid and help from Tide:

By subscribing you agree to receive email communications from Tide. You can unsubscribe anytime using the link in the footer of any of our emails. See our privacy policy.