DSM Chartered Accountants Business News 27th March 2020 – Self-employed income support grant scheme.
The Chancellor announced the new ‘self-employment income support scheme’ grant, at 5pm on Thursday 26th March 2020. Following this announcement HMRC published the detailed rules which can read in the below link to the HMRC website :-
The main points are :-
1) The grant will only be paid in early June 2020, will be part of your taxable income for tax year 2020/21 and will be calculated as 80% of an average of 3 years or less of the “trading profits” for tax years up to and including 2018/19. The 2019/20 tax year trading profits will not be included.
2) The ambiguous “trading profits” words used by the Chancellor do not appear on the self-employed pages of the Tax Return but, after further clarification this morning, we understand this to be the “Net Business Profits” figure in the Tax Return ; which is calculated after capital allowances, private use adjustments and any earlier years brought forward losses. This is very unlikely to equal the net profit figure in your annual Accounts.
3) Eligibility for the grant requires your self-employed business has lost trading profit due to coronavirus, which could be as little as a £1 loss according to the new rules.
4) Anyone commencing self-employment after 5th April 2019 is not eligible for the scheme.
5) The minimum of a 2018/19 Tax Return with self-employment pages must have been filed with HMRC and if not already filed must be filed by latest 23rd April 2020. If this relates to any of our clients or if you do not have an accountant and require help, then please urgently contact us as we can help you.
6) HMRC will automatically send you a new form to claim the grant and subsequently pay into your bank account. No date has yet been given as to when this form will be sent out.
If you have any further questions please phone 01254 823923 or email DSM on [email protected]