Home News Business News More Covid support for self employed


More Covid support for self employed

As tighter lockdown restrictions come into force, the government has said it will increase its financial support to the self employed over the coming months and ensure people get paid faster than previously planned

To reflect the recent changes to the furlough scheme, the third instalment of the UK-wide self employment income support scheme (SEISS) will be made more generous – with self employed individuals receiving 80% of their average trading profits for November.

In addition, the claims window is being brought forward from 14 December to 30 November.

In addition, more businesses will be able to access additional support as deadlines for applications for government-backed loan schemes and the Future Fund have been further extended until 31 January 2021.

Chancellor Rishi Sunak said: ‘The rapidly changing health picture has meant we have had to act in order to protect people’s lives and I know this is incredibly worrying time for the self employed.

‘That is why we have increased the generosity of the third grant, ensuring those who cannot trade or are facing decreased demand are able to get through the months ahead.’

As SEISS grants are calculated over three months, the uplift for November to 80%, along with the 40% level of trading profits for December and January, increases the total level of the third grant to 55% of trading profits.

The maximum grant will increase to £5,160.

Sunak said the revised scheme provides broadly equivalent support to the self employed as is offered to employees through the government contribution in the coronavirus job retention scheme (CJRS) in November and then the job support scheme (JSS) in the two subsequent months.

To be eligible for the grant extension self employed individuals, including members of partnerships, must have been previously eligible for the SEISS first and second grant (although they do not have to have claimed the previous grants).

They must declare that they intend to continue to trade but have either been actively trading but impacted by reduced demand due to coronavirus or were previously trading but are temporarily unable to do so due to coronavirus.

The Treasury said the increased measures amount to  £4.5bn of support for the self employed between November and January.

Derek Cribb, CEO of IPSE (the Association of Independent Professionals and the Self-Employed), said: ‘The increase in SEISS is welcome and will provide vital support for many of the UK’s struggling self employed.

‘It is important to note, though, that this enhanced 80% rate only covers November, mirroring the extended furlough scheme. It is vital that if the furlough scheme is extended, SEISS should be adjusted accordingly.’

Cribb was also critical of the government’s failure to address gaps in SEISS, as recommended by the Treasury select committee, which exclude directors of limited companies who are paid a mixture of PAYE and dividends.

‘After so many calls to resolve the problems, it now looks as if the government is wilfully ignoring a third of the self employed,’ he said.

Further reading:

Self-Employment Income Support Scheme Grant Extension

How can we help you?

Brearley & Co Accountants are pleased to offer a free, no obligation, initial consultation with one of our experts who will be happy to discuss your business needs and how we can help you.