By Tim Le Couilliard
The Chancellor Rishi Sunak has unveiled the long-awaited support package for the 5 million self-employed. Announcing what he described as a coherent, coordinated and comprehensive plan, Sunak said that it one of the most generous in the world.
The government has announced a new ‘self-employed income support scheme’. In line with the support that it has offered to employed people, the government will pay the self-employed a taxable grant of up to 80% of their average monthly profits from the last three years, of up to £2,500 a month. Open to the whole of the UK, this scheme is to be initially open for three months, with the promise of an extension if necessary. The grant can still be claimed while the self-employed continue to do business.
Sunak stated that this plan has been intended to be both “deliverable and fair”, initially supporting those with trading profits of up to £50,000 and for whom the majority of their income comes from self-employed means. To minimise fraud, only those who are currently in self-employment, and with a tax return for 2019, will be covered. Sunak stated that 95% of self-employed people will benefit from the scheme.
The scheme, in its entirety, will be ready by the beginning of June. In the meantime, self-employed people can apply for the business interruption loans that have already been announced, and can now apply for Universal Credit. Self-assessment income tax returns that were due in July have also been deferred to January 2021, whilst anyone who missed the filing deadline in January will have a further four weeks from today to submit their tax returns.
The Chancellor did, however, allude that with these changes comes a future price, and that it is hard to “justify the inconsistent contributions of employment situations”. He suggested that in the post-coronavirus UK, everyone will have to pay in equally in order to receive an equal amount of state support.
Elsewhere today the new powers of the police have been unveiled with starting fines of £60 and the power to arrest those breaking the lockdown. The Home Office has said that officers “will always apply their common sense and discretion” in the first instance but then fines will be doubled for each subsequence offence. Those who do not pay could face magistrate courts where they could be issued with “unlimited fines”. Expect increased checkpoints and patrols in the coming days, weeks and months (but hopefully not years!).