Business Planning

Self-Employment Income Support Scheme Re-opened

The self-employment scheme has been re-opened by the UK Government. Sole traders are now able to claim up to £6,570 for their lost income since 14th July 2020. An earlier scheme offered £7.8 billion to 2.7 million people in the months of May and June 2020.

Chancellor Rishi Sunak said that this scheme will ensure “people’s livelihoods across the county will remain protected as we continue our economic recovery – helping them get back on their feet as we return to normal.”

HMRC will be contacting potential eligible individuals and advise them that they are able to claim for a second grant. They have until 19th October 2020 when the scheme closes.

The UK Government is under immense pressure to extend worker support packages due to the rising unemployment levels across the country. According to the Office for National Statistics (ONS), almost 750,000 jobs have been lost since lockdown commenced in March.

If applying for the Self-Employment Income Support Scheme (SEISS), you must prove that your business has been affected by the pandemic adversely. This could be if supply chains have been disrupted or individuals have had to self-isolate.

The grant will allow applicants to gain 70% of their average monthly profit. It covers three months and will be stopped at £6,570.

In order to qualify for the scheme, applicants need to earn at least half of their general income through their self-employment. Their trading profits each year can be no more than £50,000 too.

However, according to the Association of Independent Professionals and the Self-Employed (IPSE), only half of the five million people self-employed in the UK are eligible for the grant.

The chief economist at the Bank of England predicts that the UK economy will grow by around a fifth in the second half of 2020. This would be the fastest rate since the monitoring of quarterly GDP began.

The chief economist at the Bank of England (Andy Haldane) wrote in the Daily Mail that the economy has been rising by 1% each week over the past three months. According to Mr Haldane, the UK has also recovered half of its losses since the pandemic began.

The Bank of England has forecast a 20% increase in GDP in the second half of 2020, however, unemployment levels could be 7.5% and 2.5m could be out of work by the end of 2020.

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