The Chancellor has today announced that self-employed people losing work over coronavirus will be handed emergency government grants worth 80% of their average income up to £2,500 a month.
The payments will be based on a self-employed person’s profits over the last one to three years and will be open to anyone with trading profits of up to £50,000.
It comes as ministers were under increasing pressure to offer the self-employed a package of support as has been provided for employees.
Rishi Sunak said he recognised people who work for themselves were “deeply anxious” as the spread of the virus shutdown businesses and said “you have not been forgotten, we will not leave you behind”.
Sunak said: “This scheme will be open to people across the UK for at least three months.
“And I will extend it for longer if necessary. You will be able to claim these grants and continue to do business.”
Sunak said the government can’t protect each job or every business, so the scheme will be only available to those who make the majority of their income from self-employment, so only the “genuinely self-employed” benefit.
“To minimise fraud, only those who are already in self-employment who have a tax return for 2019 will be able to apply,” he said.
“Ninety five percent of people who are majority self-employed will benefit from this scheme.
“HMRC are working on this urgently and expect people to be able to access this scheme no later from the beginning of June.”
Those eligible will be contacted by HMRC and the money will be paid into their bank accounts in one lump sum.
Anyone who missed January’s filing deadline will have four weeks to submit their tax return, but anyone who has been self-employed for less than a year and does not have 12 months’ worth of accounts to submit will be unable to access the scheme
The chancellor said the reason for this was because it would be too administratively complicated and too open to fraud to extend it to them.
While the announcement may provide some relief for self-employed, the scheme won’t actually be available till June.
More information can be obtained by logging on to www.businessupport.gov.uk