Self Employed Via A Limited Company May Not Gain From New Self Employed Scheme

27th March 2020

Those who pay themselves a salary and dividends through their own company will not be covered by the Self-Employment Income Support scheme.

They may be covered by the Coronavirus Job Retention Scheme if they are operating PAYE schemes to pay themselves salary that is taxable and dividend.

Applicants will have to wait until the start of June before getting paid and they can only be backdated until March 1.

Any loss of earnings due to coronavirus made before then won't be covered.

The grants are taxable, which you will also need to take into account.

What other help is there for the self-employed?

A range of measures has already been set out to help the self employed. These include:

Claiming Universal Credit and benefits

Those who work for themselves have already been told that they may be able to claim Universal Credit if their business has temporarily closed.

Last week, as part of the jobs retention scheme, Mr Sunak upped the Universal Credit standard allowance - the amount you're paid each month - by £1,000 a year.

The rise will come into force from April 6 on top of a planned increased linked to inflation.

The current Universal Credit standard allowance ranges between £251.77 and £498.89 depending on your age and circumstances.

You may be able to claim Universal Credit if:

you're on a low income or out of work

you're 18 or over (there are some exceptions if you’re 16 to 17)

you’re under state pension age (or your partner is)

you and your partner have £16,000 or less in savings between you

you live in the UK

In addition, Mr Sunak is suspending the self-employed Universal Credit minimum income floor for everyone affected by coronavirus.

The Universal Credit minimum income floor applies to those who've been self-employed for more than a year.

It's used to work out how much Universal Credit you get on top of your earnings, and is based on what you're expected to earn rather than your actual wages in reality.

This will be suspended as of April 6.

Self-employed workers may also be able to claim contributory Employment and Support Allowance (ESA).

You need to have two to three years worth of National Insurance contributions to be eligible.

Deferred income tax and VAT payments

Workers also now have longer to pay their income tax, under new help revealed by ministers.

The government has pushed back payments due in July 2020 under self-assessment to January 2021.

VAT payments have also been delayed from now until June 30.

Loan, mortgage and credit card holiday

Some people will be entitled to loan, mortgage and credit card payment holidays, as well as having interest or fees on debts frozen.