Millions of people across the UK can apply for a grant of up to £6,750 from today to help them through the coronavirus pandemic.
Applications for the second round of the Self-Employment Support Scheme open on Monday.
Chancellor Rishi Sunak said the move “means people’s livelihoods across the country will remain protected – helping them get back on their feet as we return to normal.”
But Shadow Chancellor Anneliese Dodds fears hundreds of thousands more self-employed workers, who’ll rely on the scheme to get them through the next three months, face hardship when autumn comes, reports The Mirror.
She said: “This second phase of the Self-Employed Income Support Scheme is too late for the quarter of a million people who left self-employment between April and June.
“The Chancellor now plans to cut off support for every self-employed worker in the country from October – no matter whether they’re back at work or back under local lockdown.
“Just like his one-size-fits-all wind down of the furlough scheme, he’s pulling the plug at the worst possible time.”
In the first round, eligible people got a taxable grant worth 80% of their average monthly profits over the last three financial years (2016/17 to 2018/19).
The grant – paid in a lump sum in June covering March, April and May – was capped at £2,500 a month, or £7,500 in total.
Applications for the second round open today. This time eligible people will get 70% of their average monthly profits, capped at £2,190 a month.
There are more than 5million self-employed Brits, but only 3.8miillion of them were potentially eligible due to strict criteria.
Government figures show 2.7 million people submitted claims during the first phase of the scheme, accessing £7.8billion in support.
The eligibility criteria remain the same as for the first grant. To claim, you have to fulfil all of these:
- You need to be self-employed or a member of a partnership
You need to have lost trading profits due to coronavirus (more on this below)
You need to have filed a tax return for 2018/19 (if you were late, you have four weeks from today)
You need to still be trading now, not just in 2018/19
You need to take more than half your total income from self-employment
You need to have trading profits under £50,000. That means a trading profit of less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19.
The Treasury has not set a figure on how much of a loss allows you to claim. In theory you could claim once you’ve lost £1.
However, tax officials will be able to check you did actually make a reasonable loss when you eventually file your 2020/21 tax return.
People are being asked to take a “responsible approach”. Officials declined to say what the penalties might be if you don’t.
HMRC says it will contact all potentially eligible customers, “including those who did not claim for the first grant”, to advise them they can claim for a second and final SEISS grant.
Anyone adversely affected by coronavirus since July 14 is eligible.
The money is supposed to land in bank accounts within six working days of making a claim.
Applications are open until October 17.
The government has made clear that today’s grant is the “final” one self-employed people will receive.
If you didn’t make a profit over the last three years (or the most recent year if you’re new) you can’t claim under this scheme.
If you pay yourself through dividends, you’re not eligible for this scheme.
This is because the tax system can’t distinguish people who pay themselves through dividends from those who claim dividends from shares.
However, if you paid yourself a salary through PAYE, you can claim a grant worth 80% of wages through the government’s separate scheme for employed people.