Originally written by Stephanie Spicer on Small Business
The government has re-opened the Self Employment Income Support Scheme (SEISS) allowing claimants to apply for a government grant of up to £6,750. The scheme was established to help those self employed workers whose income was impacted by the coronavirus pandemic.
To date over 2.7 million people have benefitted from the scheme, receiving £7.8bn. For the first grant, self-employed individuals in Scotland have made 155,000 claims totalling £449m; in Wales 108,000 claims for £289m have been made and in Northern Ireland 76,000 claims for £216m have been submitted. In England, 2.2 million claims were made totalling £6.4bn.
The second stage of the scheme means that those eligible will now be able to receive a second and final grant worth 70% of their average monthly trading profits, with the money set to land in their bank accounts within six working days of making a claim. Individuals must earn at least half of their income from self- employment and annual trading profits must not exceed £50,000.
“It means that people’s livelihoods across the country will remain protected as we continue our economic recovery – helping them get back on their feet as we return to normal.”
HMRC will contact all potentially eligible customers to advise them that they can claim for a second and final SEISS grant.
The eligibility criteria remains the same as for the first grant, with people needing to have had trading profits of no more than £50,000, making up at least half of their total income.
The SEISS is part of a package of support for self-employed people, including Bounce Back loans, income tax deferrals, rental support, increased levels of Universal Credit, mortgage holidays and the various business support schemes the government has introduced to
Eligible customers will be informed that they will be able to make their claim for the second and final grant at any time from a specified date, until the scheme closes on 19 October 2020.
The Association of Independent Professionals and the Self-Employed recently reported that a significant drop in self-employed workers is “almost certainly” because of gaps in self-employed support during the coronavirus crisis compared to the more comprehensive employee support. It also reported that self-employed quarterly incomes have dropped by 25% after a record fall in the amount of work they are able to secure.
Derek Cribb, chief executive officer of the Association of Independent Professionals and the Self-Employed (IPSE), said: “In the second quarter of 2020, there was a disproportionate and disturbing slump in the number of self-employed in the UK – far more than among employees. This is almost certainly because of the serious gaps in the government support for the self-employed, including directors of limited companies and also the newly self-employed, who are at the most fragile stage of their careers.
“Going into a recession, we would normally expect a jump not a slump in the number of self-employed, as businesses look to the flexible expertise they offer. However, with government policy driving down the number of self-employed, there is a real fear the UK workforce will become brittle and rigid just when it needs to be at its most agile.”
In the Financial Times Mr Cribb was quoted as saying that this meant only half the five million self-employed workers in the UK were eligible.
“With the risk of a second wave looming, the government must be ready to not only reopen SEISS, but also extend it to the desperately struggling, forgotten self-employed,” he said, “Historically, self-employed people have been essential for kick-starting the economy in recessions, but they cannot do this if they are driven out of business before they can play their part.”
Mr Cribb was reported to have highlighted “glaring gaps” in SEISS eligibility because limited company directors, those only recently going self-employed and freelancers paid through Pay As You Earn are not covered by the scheme.