Practical considerations for the self-employed

  • Posted

The Treasury has published a Direction to HMRC to give statutory footing to the government’s self-employed income support scheme.

Income Support Scheme (ISS)

Similar to the support which is being offered to those on furlough leave, the government will support the self-employed by providing an ‘income support scheme’ which will provide them with a taxable grant (now called a SEISS payment) of 80% of three months’ earnings typically averaged over the last three years. The SEISS is capped at £2,500 per month.

To figure out what the average ‘income’ will be, the self-employed should calculate what their average income has been over the last three years.

Who is eligible for the ISS?

The scheme is available to the self-employed who:

  • have trading profits (before tax) under £50,000 per year
  • make the majority of their income from self-employment
  • have submitted a tax return for either 2017/18, 2018/19 or 2019/20. The deadline for submitting a 2019 tax return was 31 January 2020 but the government has extended this to allow those who may be eligible to submit their tax return within the next four weeks from today 24 April 2020
    traded in the tax year 2019-20
  • remain trading when they apply (or would be but for the impact of COVID-19)
  • to have traded in 2018/19 and 2019/20.
  • to intend to continue trading in the tax year 2020-21
  • have lost trading/partnership trading profits due to COVID-19.

How do I apply for ISS?

HMRC will contact eligible self-employed people directly and will invite them to fill out an online form. Once that has been proceeded, HMRC will make a payment into their bank account.

When does it start and how long does the ISS last?

The ISS is not expected to be in place until after the end of June and it is expected to last at least three months.

Further information

For specific advice for your business, please get in touch with our specialist Employment Law team through this website or by calling 0330 404 0778.

For all of our COVID-19 (Coronavirus) advice, please visit https://www.ashtonslegal.co.uk/coronavirus/

Our partners at Ashtons HR Consulting are also on hand to assist you.


This information is correct at 10.00am on 6 May 2020.


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