United Kingdom – Support for the Self-Employed in Connection with COVID-19

The consequences of the crisis caused by the COVID-19 pandemic are affecting the state of the entire global economy and, as a result, are also being felt by individual business owners, including those running a business as self-employed in the UK. To limit the effects of this situation, government support schemes have been created, aimed both at Ltd companies in the UK and at self-employed people.

What does support for the self-employed look like?

Self-employed people whose business has suffered as a result of the coronavirus can count on financial support under the SEISS (Self-Employment Income Support Scheme). This is a scheme supporting self-employment income which provides a financial grant, and its main purpose is to help business owners keep their businesses going.

The second round of grants is currently being awarded, and the amount granted is calculated on the basis of the self-employed person’s profits. It amounts to 70% of average monthly trading profits, paid out in a single instalment covering 3 months (the maximum amount available is £6,570). This is a change from the first round, in which the funds awarded amounted to 80% of average monthly profits (applications for the first grant closed on 13 July 2020).

Government help for business owners - who can receive it?

Government support under the SEISS scheme is available to self-employed people who meet the following conditions:

• their business suffered as a result of the coronavirus pandemic on or after 14 July,

• they traded in the 2018/19 tax year and submitted their tax return for that period no later than 23 April 2020,

• they traded in the 2019/2020 tax year,

• they intend to continue trading in the 2020/21 tax year.

The grant application is verified by HMRC on the basis of the tax return for the 2018/19 tax year (eligibility conditions: trading income not exceeding £50,000, and trading income must be at least equal to non-trading income). If the return for the 2018/19 tax year does not meet the scheme’s eligibility conditions, the returns for the years 2016/17, 2017/18 and 2018/19 are verified instead.

Is it still possible to receive support under SEISS?

Applications are currently being accepted for the second round of grants, covering business owners who suffered losses in connection with COVID-19 on or after 14 July. Applications can be submitted until 19 October 2020, so it is still possible to apply to the SEISS scheme and receive financial support for your business.

If you run your own business in the United Kingdom and have doubts about whether you qualify for government support or how to obtain it, the specialists at our accounting office in London will be able to point you towards the available options. We encourage you to contact us if you have any further questions!