In the early stages of lockdown, the government announced support for sole traders in the form of the Self-Employment Income Support Scheme, or SEISS.
Just a month after its announcement, 2 million claims were made, totalling £6.1 billion in government support. And now, with a second grant opening in August 2020, a number of sole traders are set to benefit from further financial assistance.
We’ve asked Mike Parkes from GoSimpleTax to explain the terms and help you claim.
How does SEISS work?
The scheme is available to all self-employed individuals that have been adversely affected by COVID-19. This is provided that they:
To determine whether or not you were affected by COVID-19, any of the following must apply:
The first grant ended on 13th July 2020, and claimants could receive either £7,500 or 80% of their average monthly profits over the 2016/17, 2017/18 and 2018/19 tax years (whichever is the lower amount). Applications for the second grant will open on 17th August 2020, but you must have confirmed by 14th July 2020 that you have been adversely affected by COVID-19.
Why is there a phase two?
While the government set a three-month cap on the support, it has since been agreed that COVID-19 is still impacting the earnings of some sole traders. As a result, it is necessary for them to receive another grant in order to stay afloat.
It will also help to support those who may not have initially been affected by lockdown (and so did not claim the first grant) but have subsequently suffered a loss of business.
What’s the difference?
The differences between phase one and two are limited, although the second grant will be worth 70% of your average monthly trading profits. It’ll still be paid out in a single instalment that covers three months’ worth of profits, but will be capped at £6,750 total – almost £1,000 less than the phase one grant.
Additionally, you can only claim the second grant if your business was adversely affected on or after 14th July.
Can I continue working and still claim?
Yes, you can continue to work as long as you intend to continue trading in 2020/21 in the self-employed role you’re claiming for. You can even take up other employment if necessary, provided that the SEISS payments still cover the majority of your income. HMRC will not penalise you for topping up your income with a little additional earnings to sustain your household.
Phase two will have a deadline of 19th October 2020. You can find out more about it on the GOV.UK site. If you are still losing out on income or opportunities to earn, we massively recommend you claim the second grant. This is unprecedented levels of government support and could make the difference between staying afloat or falling behind.
GoSimpleTax software submits directly to HMRC and is the solution for freelancers and the self-employed alike to log all their income and expenses. The software will provide you with hints and tips that could save you money on allowances and expenses you may have missed.
Trial the software today for free – add up to five income and expense transactions per month and see your tax liability in real time at no cost to you. Pay only when you are ready to submit or use other key features such as receipt uploading.
INsiders members receive a 15% discount – to get your discount code simply sign-up to try our software above and it will be emailed to you.
If you run your owns business you’re bound to have had days where you think – Why AM I Doing This?
It can be lonely.
Hard work with little satisfaction.
Disappointing. The list is pretty long!
But don’t forget it can also be a rewarding and a fantastic one.
So how do you deal with those “aaaaaaahhhhh!” days?
Never forget why you went into business, your vision, your passion – it’s all still there, reignite it by remembering everything this career choice gives you.
List the negatives, what’s your top bug bear? Is it email mountains, admin in-trays or social media overload? Outsourcing the jobs that don’t directly pay can free up your time & more importantly your mind and energy to concentrate on the success of your business.
Having no boss has so many advantages but if you did what would they say should be your top priority? A boss also is there to acknowledge your achievements, so if you don’t give yourself a pat on the back, who else will?
Remember to ask yourself lots of questions ALWAYS. Asking good questions leads to good answers – get noisy and always question what is the best course of action, what do you need to be doing? What’s – When’s and How’s.
Who can you rely on to motivate and inspire you? Who will support you and pick you up again – social networking, a coffee with a friend, networking, business meetings, mentoring, coaching – what will you rely on?
Knowing what motivates and inspires you will spur you on – so the next time you have a tough day – You Will be Ready for it!