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Extended support for the self-employed

Extended support for the self-employed

With a second England wide lockdown announced by the Prime Minister, Boris Johnson (PM), on 31/10/2020, the long road to economic recovery is about to hit another bump. Following this news, we quickly learnt that the Furlough Scheme was to be extended for a further month to cover this new lockdown period. With employees unable to work, again being able to claim 80% of their wages, those who were self-employed were left in a state of limbo: unclear as to what, if any, support was on the horizon. (https://www.gov.uk/government/news/furlough-scheme-extended-and-further-economic-support-announced)

Self-Employed Income Support Scheme

The Self-Employed Income Support Scheme (SEISS) had already seen an extension. With the third grant being open to applications from 14/12/2020, those who were eligible were set to receive 40 percent of their average earnings to cover a 3-month period. This saw a dramatic drop from the 80 percent and 70 percent averages offered for the first and second grants, respectively.

With the reintroduction of the 80 percent cap for the employed, it again appeared that perhaps the nations self-employed were to be forgotten, with no additional support forthcoming and no plans in place to supplement their income.

Adjustments to SEISS

The announcement made on 02/11/2020, by the Chancellor, Rishi Sunak, will have brought a degree of relief to those that feared the worst. Recognising the disparity between the employed and the self-employed schemes, Sunak stated, "And what we have done typically, during these crises, is adjust the value of the grants, as we have adjusted the value of support to those who are employed." Sunak went on to say, "The 40 percent will go up to reflect at least one of those months of support will be at a higher level." (https://www.independent.co.uk/news/business/self-employed-lockdown-support-sunak-b1530482.html)

With lockdown coming into force on 05/11/2020 and being in effect until at least 02/12/2020, there are still uncertain times ahead for many. This additional support will come as welcome news to those who are self-employed but with fears of how long the second lockdown may go on for, or what any new tiered system may look like, the future, as yet, is less than bright.

Perhaps the ongoing changes with SEISS, eligibility to Universal Credit, and continuing peaks and troughs in income will cause some confusion when it comes to your next sole trader accounts and personal tax returns. Should that be the case, our team of experts are on hand to guide you through.

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