On Friday 21st March the Chancellor, Rishi Sunak, set out a package of measures to support public services, people and business through the disruption caused by the COVID-19 virus. Further measures were announced on 26th March to support the self-employed.
CORONAVIRUS JOB RETENTION SCHEME
HMRC will reimburse 80% of ‘furloughed’ workers wage costs, up to a cap of £2,500 per month.
Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis. All UK businesses are eligible. Employers will need to designate affected employees as furloughed workers, and notify your employees of this change.
Employers will also be required to submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (still awaiting information from HMRC)
SELF-EMPLOYMENT INCOME SUPPORT SCHEME
On 26 March the Chancellor announced a grant to be paid to the self-employed and members of a partnership who have lost income due to coronavirus. This scheme will allow you to claim a taxable grant worth 80% of your trading profits, up to a maximum of £2,500 per month, for the next 3 months. The 80% figure will be based on the average net profits for 2016/17 to 2018/19.
There is a further condition that your self-employed trading profits must also be less than £50,000 and more than half of your income must come from self-employment.
Only those who have submitted their 2018/19 tax return, traded in 2019/20 and intend to trade in 2020/21 are eligible. If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018/19, you must do this by 23 April 2020 to qualify.
HMRC will contact taxpayers who are eligible for the scheme and invite them to apply online. HMRC will pay the grant directly into the taxpayer’s bank account, in one instalment, in June 2020.
If you claim tax credits you will need to include the grant in your claim as income.
What was absent from the Chancellors statement was support for personal service companies (PSC) who are likely to fall between two stools. HMRC guidance however states “If you’re a director of your own company and paid through PAYE you may be able to get support using the Job Retention Scheme (JRS)” but how many PSC directors can justify that they are furloughed!
STATUTORY SICK PAY
Statutory sick pay (SSP) is normally payable from the fourth day of absence, however if you are self-isolating because of COVID-19 from 13 March, you can now claim SSP from day 1. This includes individuals who are caring for people self-isolating in the same household and are in quarantine.
The rate of SSP is currently £94.25 per week and it is paid by employers for up to 28 weeks.
From Friday 20 March onwards, those who have COVID-19 or are advised to self-isolate will be able to obtain an “isolation note” by visiting NHS 111 online and completing an online form.