From 17 August self-employed workers can apply for the second, and final, stage of the UK government’s self-employment income support scheme.

The eligibility criteria are the same as for the first scheme, which opened on 13 May and closed to applications on 13 July.

It provided a taxable grant worth up to 80% of average profits over the last three years, up to a maximum of £2,500 per month for three months (£7,500 in total).

The main difference this time is that government has reduced the top grant rate from 80% to 70% of profits, or a maximum of £2,190 per month for three months (£6,570).

The second grant can be claimed at any stage up to 19 October 2020. It is to be paid direct into bank accounts within six working days of making a claim.

To be eligible, trading profits must be no more than £50,000 (either in 2018/19, or an average over the last three years), and make up at least 50% of your total income.

Adversely affected

However, when making the online claim, it is also necessary to confirm that your business has been adversely affected by coronavirus on or after 14 July 2020.

The same requirement existed in the first grant, and with marts closed and output prices down, there was a clear case for farmers to make a claim.

There is more advice available from HMRC this time around on what being “adversely affected” by coronavirus would actually constitute.

“This typically means that your business has experienced lower income and/or higher costs because of coronavirus (COVID-19) at any time since 14 July. As the person who knows your business best, we expect you to make an honest assessment” states HMRC guidance.

There is no minimum threshold over which income or costs need to have changed, but a claimant should keep a record of evidence (such as accounts showing a reduction in turnover or increase in expenditure).

Guidance published on Monday gives some examples of a business negatively impacted by coronavirus. The examples mainly relate to a self-employed builder and a shop-keeper.

In the first example, the builder is eligible for both grants where they are unable to find work because building sites are closed. In a second example, a builder was able to work as normal since February, but caught coronavirus in August. They are not eligible for the first grant, but are eligible for the second.

The shop keeper has reopened their business in June, but has had to buy personal protective equipment, and social distancing rules mean customer numbers are down. They are eligible for both grant payments.

UFU

In a statement released on Monday, the UFU said that the re-opening of the scheme was positive news for members.

“We encourage members to make use of this Government support if it is relevant to them”, said UFU President Victor Chestnutt.

Read more

Self-employed support scheme opens

COVID-19 money to land in September