NFU Scotland | /financial-support-for-the-selfemployed.aspx

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Support for the Self-Employed


What support is available for self-employed people?

There are two support packages in place:

  1. The Newly Self-Employed Hardship Fund,
  2. Self-Employed Income Scheme.


What is the Newly Self-Employed Hardship Fund?

A Scottish Government scheme, the Newly Self-Employed Hardship Fund is a one-off grant of £2,000 for eligible applicants.

  • Applicants need to apply via their local authority and can only apply to the fund once,
  • You will need to provide documentary evidence of your status and eligibility for the grant to demonstrate:
    • You had an active business prior to COVID-19, 
    • You are currently experiencing hardship, 
    • You are a resident in the local authority area that you are applying to.

More information is available here:
https://findbusinesssupport.gov.scot/service/coronavirus/newly-self-employed-hardship-fund


I am self-employed and my business has been impacted by COVID-19 – what help is available?

On 26 March the Chancellor of the Exchequer announced a support package for self-employed individuals whose businesses have been adversely impacted by COVID-19.

The key features of the package are a taxable grant of 80 percent of average monthly profits for self-employed individuals up to a maximum of £2,500. Initially, it will be available for three months, but it may be extended.  

The scheme will be open to all self-employed individuals who have at least one year of tax returns. If you are eligible to receive a grant, it will be subject to Income Tax and National Insurance contributions but does not need to be repaid. If you receive the grant, you can continue to work or take on other employment including voluntary work.

For more information, please refer to NFU Scotland’s Business Guide Update: https://www.nfus.org.uk/nfuscontent/business-guides/17559/coronavirus-income-support-scheme-for-self-employed-workers

Please note that HMRC are taking a stringent approach to ensuring all applicants are compliant. To be successful in receiving a grant, you will need to clearly demonstrate that your business has been adversely affected by coronavirus and fully comply with the requirements of the Self-employment Income Support Scheme.  


When can I apply for the Self-Employed Income Scheme?

The online service is now available. HMRC will work out if you are eligible for the scheme and how much grant you may get.

If you are eligible, HMRC will tell you the date you can make your claim from and that if your claim is approved, you’ll receive your payment within 6 working days.

Check the current guidance here for more information: https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme#check


Who can claim for the Self-Employed Income Support Scheme?

HMRC will contact you if you are eligible and invite you to apply to the Scheme. 

However, you can also check if you are eligible for the scheme via an new tool, available here: https://www.tax.service.gov.uk/self-employment-support/enter-unique-taxpayer-reference. Your tax agent or adviser can also check on your behalf.

The Scheme is available if you are a self-employed individual or a member of a partnership and you:

  • have submitted your Self-Assessment tax return for the tax year 2018 to 2019,
  • traded in the tax year 2019 to 2020,
  • are trading when you apply, or would be except for coronavirus,
  • intend to continue to trade in the tax year 2020 to 2021,
  • have lost trading profits due to coronavirus.

Please note that your trading profits must be nor more than £50,000 and more than half your total income for either:

  • The tax year 2018 to 2019,
  • The average of the tax 2016 to 2017, 2017 to 2018 and 2018 to 2019.


I haven’t submitted a Self-Assessment tax return, what should I do?

If you haven’t submitted your Self-Assessment Tax return for the tax year 2018 to 2019 you must do this by 23 April 2020 or you will not be able to claim.

HMRC will review any late returns in the usual way.

If you haven’t submitted a Self-Assessment Tax Return for all three tax years (2016 to 2017, 2017 to 2018 and 2018 to 2019), HMRC will work out your average trading profit based on continuous peroids of self-employment, which will be either:

  • The tax years 2017 to 2018 and 2018 to 2019,
  • The tax years 2018 to 2019 only, even if you were self-employed in the tax year 2016 to 2017.

The grant will be 80% of your average trading profit, divided by 12 which will give a monthly amount. We will pay this or up to a maximum of £2,500 a month, whichever is lower.

HMRC plan to pay the grant directly into your bank account, in one instalment.

What other support may I be eligible for?

You can make a claim for Universal Credit while you wait for the grant. You will need to record the grant as part of your self-employed income, which may influence the amount of Universal Credit you can receive.

If you are employed as a director or employee paid through PAYE, you may be eligible for support via the Coronavirus Job Retention Scheme.

What other kind of help can I get?

The following help for the self-employed is also available:

  • Deferral of Self-Assessment Income Tax and VAT payments,
  • Grants for businesses that pay little or no business rates, or the
  • Business Interruption Loan Scheme.

Find more information about the financial support for businesses here:
https://www.gov.uk/government/collections/financial-support-for-businesses-during-coronavirus-covid-19#support-for-businesses-that-pay-little-or-no-business-rates

You can use the UK Government business support finder to find what support is available to you and your business here: https://www.gov.uk/business-coronavirus-support-finder

Please also check the information available within the financial support for businesses section of the FAQ here: https://www.nfus.org.uk/coronavirus/coronavirusqa/support-for-businesses-managing-covid19.aspx

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