Business Support
Self-employed or member of a partnership
Information last updated: 7 April 2020
The following schemes are relevant:
- business grants of £10k for those small enough to receive rates relief (SBGF); £10k per property for retail businesses with rateable values under £15k or £25k for rateable values under £51k – all administered by the local authority (RHLG);
- Self-employed income support scheme (SEISS): self-employed or partners who have lost income because of Covid-19 and meet the criteria will be automatically contacted about the scheme by HMRC: the scheme is available to individuals with trading profit less than £50k per year and provides 80% of profits averages across tax returns for the last three years up to £2500 per month for 3 months;
- deferment of taxes due (VAT) for 3 months but not payable until Jan 2021. Any refund claims will be paid as usual;
- HMRC will look favourably on time to pay agreements to manage tax liabilities
- business loans for companies with turnover below £45m (CBILS), can borrow up to £5M with 80% guaranteed by the government and interest free for the first 12 months;
- self-assessment income tax: advance payment due in July 2021 deferred to January 2021
- Universal credit: where individuals are facing severe hardship, they may be covered by Universal Credit, and they may be able to receive a loan against future payments to shorten the lead time;
- mortgage providers have been encouraged to look favourably on requests for mortgage holidays and landlords have been given protection to ensure renters will not be evicted;
Commentary
Business Grants:
These will be taxable at the year end, just like any other income.
The scheme directed specifically at the self-employed covered a significant gap that may affect a number of audiologists. For many self-employed, SEISS will provide essential support to cover the drastic drop in income, but the delay before support becomes available towards the end of June will be a concern to many, even though it will be back-dated.
The eligibility gap on profits will exclude those with higher earnings. Any who have become self-employed recently and not yet been able to declare trading profits on their tax returns will also be penalised. The deadline for submitting tax returns has been extended by a month, and anyone who has yet to complete should do so urgently.
The scheme will be administered by HMRC who will automatically call those who are eligible, once the scheme is running.
The CBILS scheme is also available to support self-employed with the same caveats identified for directors of small limited businesses, though many self-employed may deem the barriers for them to be more difficult. This scheme is more likely to offer benefits to members of partnership schemes, especially those with several partners.
