14 March 2020 | UK

Self-Employment Income Support Scheme

Aga Khan Economic Planning Board for the United Kingdom
Self-Employment Income Support Scheme
(Last Updated: 31 March 2020)

The government has announced support for self-employed workers/partnerships to be able to apply for a taxable grant worth 80% of their profits, up to a cap of £2,500 a month, for an initial three months to help them cope with the financial impact of COVID-19, for average annual trading profit of less than £50,000. Conditions apply.

To qualify for this grant, the following conditions must be met:

  • have submitted their Income Tax Self-Assessment tax return for the tax year 2018-19
  • traded in the tax year 2019-20
  • be trading when applying, or would be except for COVID-19
  • intend to continue to trade in the tax year 2020-21
  • have lost trading/partnership trading profits due to COVID-19

HMRC will invite you to apply and if you are eligible, you will be paid a lump-sum grant in early June.

Example of claim calculation

Assuming all conditions are met, self-employed workers would be able to calculate and claim as follows:

Example:

Tax Year     Trading Profit (as per tax returns)
2016-2017  £14,000.00
2017-2018  £15,000.00
2018-2019  £16,500.00
Total          £45,500.00

Average Trading Profit Per Year
£45,500.00 divided by 3 Years = £15,166.67

Average Trading Profit Per Month
£15,166.67 divided by 12 Months = £1,263.89
Entitlement
£1,263.89 x 80% = £1,011.11 per month (maximum entitlement is £2,500.00)

Total Grant Entitlement for 3 months’ = £1,011.11 x 3 Months = £3,033.33

If you would like more details on this income support scheme for self-employed please visit:

https://www.businesssupport.gov.uk/self-employment-income-support-scheme/
https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-...