News article

Coronavirus: Support and advice for the self-employed

30 July 2020

Overview of the support and help available to self-employed individuals during the COVID-19 disruption

The COVID-19 pandemic has disrupted business activity and created uncertainty for those who are self-employed. The following measures have been designed to provide help and support to them during these challenging times.

Self-Employed Income Support Scheme

Support available: The Self-Employment Income Support Scheme (SEISS) is made up of two grants to self-employed individuals whose businesses have been adversely affected by coronavirus. The first grant closed on 13 July 2020. The second and final grant will be worth up to 70% of your trading profits, with the maximum amount payable for this grant £6,570.

If you’re eligible for the second and final grant, and your business has been adversely affected on or after 14 July 2020, you’ll be able to make a claim from 17 August 2020.

Eligibility: You can claim if you're a self-employed individual or a member of a partnership and all of the following apply:

  • you traded in the tax year 2018 to 2019 and submitted your Self Assessment tax return on or before 23 April 2020 for that year
  • you traded in the tax year 2019 to 2020
  • you intend to continue to trade in the tax year 2020 to 2021
  • you carry on a trade which has been adversely affected by coronavirus

To be eligible, your trading profits must be less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19. Check if you can claim a grant through the Self-Employment Income Support Scheme.

How to access: You must apply online.

Claim a grant through the Self-Employment Income Support Scheme.

VAT payment deferral

Support available: Business payments for Valued Added Tax (VAT) were deferred for three months for payments that would otherwise have arisen during the period from 20 March to 30 June 2020. The VAT payment deferral period ended on 30 June 2020. Taxpayers will be given until the end of the tax year 2020/21 to pay any VAT liabilities that have accumulated during this deferral period.

Eligibility: All UK VAT registered businesses are eligible, including all legal entities as well as self-employed sole traders that are UK VAT registered.

How to access: This is an automatic offer with no applications required. You do not need to tell HMRC that you are deferring your VAT payment

See Coronavirus: Deferred VAT payments.

Self-Assessment payment deferral

Support available: If you're self-employed, the Self-Assessment payment on account that is ordinarily due to be paid to HMRC by 31 July 2020, may now be deferred until January 2021.

Eligibility: If you are due to make a Self-Assessment payment on account on 31 July 2020 then you are eligible for the deferment.

How to access: Deferred Self-Assessment payment is an automatic offer. You do not need to apply. No penalties or interest for late payment will be charged in the deferral period. The deferment is optional - anyone able to pay their second self-assessment payment on 31 July 2020, should still do so.

See Coronavirus: Deferred Self-Assessment payments.

Help with your tax

You can call the HMRC's coronavirus (COVID-19) helpline if you have difficulties paying your taxes on Tel: 0800 024 1222, during the following hours (excluding bank holidays):

  • Monday to Friday 8.00 am to 8.00 pm
  • Saturday 8.00am to 4.00pm

HMRC will discuss your specific circumstances to explore:

  • agreeing an instalment arrangement
  • suspending debt collection proceeding
  • cancelling penalties and interest where you have administrative difficulties contacting or paying HMRC immediately

See Support for businesses paying tax.

Business rates relief

Support available: Emergency rates package for businesses includes:

  • Delay in rate bills - to avoid placing financial pressure on ratepayers affected by COVID-19, rate bills will not be issued until July 2020.
  • Rates holiday for business ratepayers, excluding public sector and utilities - no rates will be charged for April, May June and July 2020. This amount does not need to be paid back.
  • Rates relief for specific sectors - the sectors hardest hit by the coronavirus pandemic will pay no rates for the full financial year up until 31 March 2021.

See COVID-19: Emergency rates package for businesses and Rates support for businesses.

Additional relief: Businesses can also avail of the Small Business Rate Relief and the Hardship Rate Relief scheme for non-domestic ratepayers affected by exceptional circumstances.

Grants: Eligible ratepayers were also able to apply for the £10,000 Small Business Support Grant, the £25,000 Retail, Hospitality, Tourism and Leisure Grant and the £10,000/£25,000 Small Business Grant for rental properties. Applications for these schemes have closed on 20 May 2020.

Coronavirus Business Interruption Loan Scheme (CBILS) for SMEs

Support available: Small and medium-sized businesses can access loans and other kinds of finance up to £5 million. The government guarantees 80 per cent of the finance to the lender and pays interest and any fees for the first 12 months.

Eligibility: You can apply for a loan if your business is based in the UK and has an annual turnover of up to £45 million. You will need to show that your business would be viable were it not for the pandemic and has been adversely impacted by the coronavirus.

How to access: Over 50 lenders are participating in the scheme, including all the main retail banks. You should approach a suitable lender yourself via the lender's website.

Apply for the Coronavirus Business Interruption Loan Scheme - for small and medium-sized businesses.

Bounce Back Loans Scheme (BBLS)

Support available: Small and medium-sized businesses, including self-employed individuals, can borrow between £2,000 and £50,000. The government guarantees 100 per cent of the loan and there won’t be any fees or interest to pay for the first 12 months. Loan terms will be up to 6 years. No repayments will be due during the first 12 months.

Eligibility: You can apply for a loan if your business is based in the UK and has been negatively affected by the coronavirus disruption.

How to access: You must find and approach a BBLS accredited lender, ideally via its website.

Apply for the Bounce Back Loan scheme.

Help to claim benefits

If you're getting less work or no work because of coronavirus, you can also:

Help to manage your cashflow

If you're experiencing financial difficulties, talk to your existing finance provider to see what they can do to help you manage existing debt.

If you have an existing loan or asset purchase (for example a lease or HP agreement), you could ask for a repayment holiday. You may also need a new or increased overdraft facility, or to secure additional finance. Talk to your customers, especially large customers, and ask if they can pay your invoices more quickly.

Find more information on organisations who can provide advice on managing debt.

Depending on the nature of your work and sector, it is likely that the business activities will be disrupted. If you're able to work during COVID-19 pandemic, or if it is feasible for you to resume some business activity as the lockdown measures ease, it’s important that you do this safely. See Workplace safety guidelines and social distancing.

First published 19 March 2020