HMRC guidance on self-employment income support scheme
The HMRC has published guidance on the self-employment income support scheme announced by the Chancellor last week.
The scheme, announced to curb the economic impacts of the coroanvirus pandemic, will allow the self-employed to claim a taxable grant worth 80 per cent of their trading profits up to a maximum of £2,500 per month for the next three months.
To apply, an individual must be self employed or a member of a partnership and have submitted an income tax self assessment tax return for the tax year 2018-19, traded in the tax year 2019-20 and have an intent to continue to trade in the tax year 2020-21.
"Your self-employed trading profits must also be less than £50,000 and more than half of your income come from self-employment," the HMRC said.
This is determined by at least one of the following conditions being true:
- having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of total taxable income; and
- having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of average taxable income in the same period
To work out the average, the HMRC will add together the total trading profit for the three tax years (where applicable) then divide by three (where applicable), and use this to calculate a monthly amount.
The HMRC confirmed that individuals should wait to be contacted.
"HMRC will contact you if you are eligible for the scheme and invite you to apply online," it said.
"Individuals do not need to contact HMRC now and doing so will only delay the urgent work being undertaken to introduce the scheme."
Further information is available here.