COVID-19 Advice For Self Employed

Self Employed Coronavirus Pandemic Advice

Self employed individuals of all types are finding themselves in a situation that they haven’t prepared for, and who can blame them – even the biggest businesses out there (and Governments!!) hadn’t planned for this eventuality either. But here we are, so what do you do now as a self employed person?

When we’re talking to the self employed we understand we’re talking to quite a varied audience, actually. So we first need to narrow down our general advice and announcements to the type of self employed that you are. Most of you will fit into one of the following categories: gig workers, sole trader, freelancer, contractor, business owner/manager. there will, of course, be others, like professional landlords for example- if you’re a landlord please head over to our landlord coronavirus advice page. For anyone else please feel free to contact us for specific tailored advice.

After a bit of prodding the government has announced measures to assist the self employed who can’t work at this time due to the pandemic. However at this time it depends on the type of self employed you as as to what support is available – and sadly there isn’t great news for everyone. But the updates on support are on-going and there are always measures you can take to keep your small business going at a time like this – you may just have to be willing to diversify.

Self Employed Income Support Scheme

A step-by-step guide to applying for the SEISS.

Small to Medium Business Grants

Read all of the information on the latest grants offered to businesses negatively effected by the coronavirus pandemic.

Small to Medium Business Loans

Detailing the government backed loans available to small to medium businesses in the UK

Coronavirus Job Retention Scheme

A step-by-step guide to furloughing employees and claiming CJRS grants from the government

Latest Updates

29/05/2020 – Self Employed Income Support Scheme extended until August

12/05/2020 – Furlough scheme extended until the end of October

04/05/2020 – Self Employed individuals can check if they are able to access a support grant and apply online, details here.

14/04/2020 The government has extended the deadline for the 2018-2019 tax return until 23rd April to allow those who are late filing to do so and access the Income Support Scheme.

14/04/2020 – 45% of self employed will struggle to manage essential bills and payments.

09/04/2020 – Contractors inside IR35 denied furlough may have legal recourse.

FAQs For Gig Workers & Zero Hour Contracts

Will I be furloughed like my colleagues?

Your employer may choose to furlough you, even if you’re a ‘gig worker’ or are currently working under a zero hour contract. Any employee who is on PAYE and has been hired before 28th Feb 2o20 is eligible. Even employees on variable hours can be furloughed. The amount you’ll receive will be 80% of your average salary. Check with your employer who will be able to calculate this for you.

Should I apply for Universal Credit?

If you are not furloughed but your work is being impacted by the affects of the coronavirus pandemic you may apply for Universal Credit. The amount you could receive depends on your specific circumstances, you can check your eligibility here: Citizens Advice Bureau

I've only been a gig worker for a few months, what support is available to me?

As long as you’ve been engaged by your employer since before 28th Feb 2020 you can be furloughed by your employer. You may also be able to apply for Universal Credit.

FAQs for Freelancers & Contractors

I usually pay high dividends and low salary - what support is available to me?

The government have only offered furlough support to employees or to self employed who pay 20%+ tax, those who pay less tax via dividends have been excluded from support. This has left many self employed and business owners in a difficult position, with other loans and grants unsuitable.

However, the relatively new ‘Bounce-back Loan’ may be suitable for your self employed business, these loans are 100% government-backed and are very easy to apply for. Remember, though, this is a loan – while it is interest free for 12 months you will need to have a plan to pay it back. Find out more on this blog.

Can I apply for grants or loans as a PSC?

Yes, your PSC company may apply for the following loans:

It is unlikely that any of the grants will be applicable to your business.

FAQs For Sole Traders

How do I furlough myself? And who will handle essential business admin if I'm furloughed?

As a self employed sole trader you can, effectively, furlough yourself and receive an 80% trading profit grant (up to maximum of £2500 per month) from the government between March and May. These grants are being issued throughout May and June, find out how to apply here.

Unlike the employee scheme, here you CAN keep working. And you do not need to prove coronavirus impact. However, HMRC says it only expects people to use the SEISS if they’ve been negatively impacted, and is introducing checks to prevent fraud.

My trading profits are over £50,000pa - what now?

If your trading profits are over £50,000, then unfortunately you will not qualify for the Self Employed Income Support Scheme. This may seem unfair, especially if your trading profits are high because you live and operate in an expensive area, like London. We acknowledge that not every self employed individual who has trading profits over £50,000 is wealthy, and this is an upsetting area of oversight by the government.

You may wish to consider the Bounce-back Loan as a temporary stop-gap option.

I don't have a 2018-19 Self Assessment because I'm relatively newly self employed - what can I do?

We understand that the government have chosen to exclude those who are newly self employed because they want to base the support grant amount off an individual’s average annual income. This is unfair and has left many who have been self employed for under one year with no support. The Bouce-back Loans may be an appropriate stop-gap, but this is not ideal because it is still a loan and will need to be repaid.

This is also an issue for those who have significantly increased their self employed income in the last 12 months, who may receive significantly less than 80% of their recent income.

FAQs for Owner Managers

Are any of the government grants open to my business?

Your business may be eligible for one or both of the following grants:

  • £10,000 grant
  • £25,000 grant

Your business will be notified by your local council if you are eligible for these grants.

You can find out more here.

How do I furlough myself?

To furlough yourself you can follow the same process as if you were furloughing an employee. Follow the steps on this blog.

I usually take dividends and a small salary - what can I do if I can't manage on 80% of my usual salary?

Many self employed individuals who pay minimum salary and maximum dividends will struggle to survive on 80% of their monthly salary, as this will likely amount to less than £1000 per month.

The only other avenue you could consider is to apply for a Bounce-back Loan to help you manage as a stop-gap until you can continue working as usual.

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Contacting Us

We’re here for you. We are of course experiencing unprecedented levels of contact from our valued clients, but we are working hard to get in touch with everyone as quickly as possible. While we’re operating a skeleton staff in our Manchester and Stockport offices, all other staff are working from home and we are still fully operational. So please contact us via the usual phone numbers and email addresses, or you can complete this contact form.

Call Stockport: 0161 477 6789
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