How to claim for the Self-Employment Income Support Scheme
It has come to our attention that you will need a Personal Tax Account to be able to access the Self-Employment Income Support Scheme.
Please find here instructions on how to set up a Personal Tax Account, if you don’t already have one. If you do, you will have a 12 digit Gateway code and your password.
If you do require any assistance, then please don’t hesitate to contact the office on 020 8529 2600.
You can download these instructions as a PDF file
Check if you can claim a grant through the Self-Employment Income Support Scheme (PDF)
Checking to see if you are eligible for the Self Employment Income Support Scheme
You will need:
- Self-Assessment Unique Taxpayer Reference (UTR) (this information will be on your computation report or documents that you have received from HMRC
- Your National Insurance number.( you can get this information from your Personal Tax Account or computation report.)
- Your Government Gateway User ID
Please note that online service may be slow during busy times, so just keep trying.
If you are eligible
HMRC will tell you the date you will be able to make a claim from and ask you to add your contact details. They will use these to remind you when the online service will be available.
If you are not eligible
If HMRC have told you that you’re not eligible to make a claim, you can ask HMRC to review this after you’ve used the online tool. If you want to do this at a later time, you’ll be able to use the online tool more than once
Enter your 10-digit UTR/Tax reference number (this information will be on your computation report or documents that you have received from HMRC), now click on the green continue button.
Enter your National insurance number (you can get this information from your Personal Tax Account or computation report.) and then press continue
If you are eligible you will see this screen, which will show the date that you will be able to claim from.
Unfortunately, if you are not eligible, you will see this screen, but may have other support available.
If you were eligible, then press continue (green button)
This is now the screen, that you need to enter your Government Gateway user ID and password. (You should have set up this from our guide, that has been previously sent to you.) Click on the blue writing (sign in and add your contact details.)
You now need to sign in with your 12-digit ID and your password, then press sign in (green button)
You will now see the screen regarding security preferences, press continue (green button)
You should have now received a code to the mobile number you entered when you set up your Personal Tax account and Government Gateway ID. Please bear in mind that you only have 15 minutes to enter code
If you do not receive a code, then check that the last four digits match your mobile number, if you have received the code, then enter the code in the Access Code box and press continue (green button)
Now type in your email address and UK mobile number, make sure that you type these details carefully, as these will be the details that HMRC use to contact you, to tell you when you can make your claim and they will use these details to update the HMRC contact record that they hold for you, Once you have entered your details, press continue (green button)
You will now have one more chance to check that you have entered the correct contact details, if correct, press submit (green button)
The screen will now confirm that the contact details have been submitted and confirm that you will be able to claim from a certain time and date.
To date the HMRC have not confirmed if they will contact you by telephone or by email.
The only guidance that has been given is below: –
You will only need your:
- Self-Assessment UTR – if you do not have this find out how to get your lost UTR
- National Insurance number – if you do not have this find out how to get your lost National Insurance number
- Government Gateway user ID and password – if you do not have a user ID, you can create one when you check your eligibility online
- bank account number and sort code, you want us to pay the grant into (only provide bank account details where a Bacs payment can be accepted)
You will have to confirm to HMRC that your business has been adversely affected by coronavirus.
If you claim the grant HMRC will treat this as confirmation you are below the state aid limits.
HMRC will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate.
Just to also make you aware that guidance for when after you have claimed is:
Once you have submitted your claim, you will be told straight away if your grant is approved. We will pay the grant into your bank account within 6 working days.
You must keep a copy of all records in line with normal self-employment
record keeping requirements, including:
- the amount claimed
- the claim reference number for your records
- evidence that your business has been adversely affected by
You will need to report the grant:
- on your Self-Assessment tax return
- as self-employed income for any Universal Credit claims
- s self-employed income and that you are working 16 hours a week for any tax credits claims
If you wish to read the full guidance from HMRC in relation to the Self employment income support scheme, then please click the link below: www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme
Government ‘bounce back’ loans
On 27 April, the Chancellor announced a new loan scheme which is aimed at supporting micro-businesses.
A micro business is usually defined as a very small business that can be a company or a sole trader. In general, it must have any 2 of the following: a turnover of £632,000 or less. £316,000 or less on its balance sheet. 10 employees or less.
The potential problem is that legislation allows the definition to be set by government depending on what their needs are. This new legislation however is there to pick up the forgotten small ltd company owners who receive their income through dividends and were missed in the self-employed grant legislation. We of course need it to be about small private hire and chauffeur companies who have been devasted by the fallout of the pandemic and have been missed, to give them the same chance as self-employed businesses to have the ability to ‘bounce back’.
This scheme will provide loans of between £2,000 and £50,000 for up to six years. The government will pay any interest on these loans for the first 12 months. No repayments will be due for the first 12 months. The scheme will also provide lenders with a 100% government backed guarantee, unlike the government business interruption loans known as CBILS at 80%
The following businesses are eligible to participate in this scheme…
- Businesses based in the UK
- Those businesses that have been negatively impacted by coronavirus
- Were not classed ‘undertaking in difficulty’ on 31 December 2019
You also can’t apply if you’re already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS).
How Can You Get One?
You’ll be able to apply online using a short and simple two-page self-certification. form. Because the loan is entirely Government-backed, lenders will hopefully have the confidence to offer finance without the lengthy and complex red tape associated with CBILS and other loan schemes.
Firms applying for the new loans will only have to prove that they were viable in the past before the corona crisis, not that they will remain viable after the crisis.
The good news is that you will be able to access the cash within days.
There remains some concern that banks will still wish to assess the latest financials through a ‘cash available to service debt’ calculation. Where there isn’t sufficient cash to service the debt, there are fears that the loan may still not be granted despite the Government guarantee. Further clarification is expected from the government soon.
The scheme has been designed especially for small firms, including sole traders, that require ‘vital cash injections’ to help them operate during these challenging times. It will launch for applications from 9am on Monday 4 May and the loans will be provided through a network of accredited lenders.
The Government said that loans will be ‘advanced as quickly as possible’ and that they will agree a ‘low standardised level of interest for the remaining period of the loan’.
Rishi Sunak said the scheme will help bolster the existing package of support available to the smallest businesses affected by the coronavirus pandemic.
Words from The Government
The Chancellor of the Exchequer, Rishi Sunak, said:
‘Our smallest businesses are the backbone of our economy and play a vital role in their communities. This new rapid loan scheme will help ensure they get the finance they need quickly to help survive this crisis.
This is in addition to business grants, tax deferrals, and the job retention scheme, which are already helping to support hundreds of thousands of small businesses.’
Business Secretary Alok Sharma said:
‘Our small businesses are vital in ensuring our communities thrive and will be crucial in creating jobs and securing economic growth as we recover.’
Important information relating to the Self-Employed Income Support Scheme
Let’s just hope that it won’t have any hidden problems with the new loan scheme. The news just in on the Self-Employed Grant Is.
- Accountants at the moment, will not be able to make the claim on behalf of their clients. You will have to sign up to the government gateway in order to access the claim.
- This will make the process a bit complicated and scary for many people Please then get your government gateway access as soon as possible or ask your accountant to help you get it. if you think you are likely to be able to claim.
- WE are not supposed to file the claim under your credentials either Thankfully we are still awaiting further detailed on registering and many of our professional associations are lobbying hard to allow us to actually give you guys hands on help to do this.
Lots to think about and help to get for all driver sand small private hire businesses, you can go to our website for more help on Eazitax.co.uk/blog/coronavirus.
Take a look at our other Coronavirus articles and advice
The Eazitax emergency blog
Let’s start with the fact that as we go to press the COVID-19 virus is just really taking hold in the UK and a lockdown is underway. So, we can’t avoid talking about it because from a business perspective, over and above the human tragedy, the main thing I have been dealing with is the current effect that it has on our clients.
Firstly, I would say that hopefully every well run business should have contingency plans in place. Sorry to those who know me and who have heard it before, but personally and commercially always have three months money set aside. Please don’t hate me for saying it now, but older airport transfer companies should have learnt from the 2010 eruptions of Eyjafjallajökull in Iceland which threw ash out and decimated the controlled airspace of Europe, resulting in the largest air-traffic shut-down since World War II. However, I like many people sometimes get it wrong, and hey, it was 10 years ago!
So, let’s look at what should be keeping us awake at night now, and some practical help, I hope.
Firstly, the budget has addressed the issue in part. The initial focus was on the short-term measures needed to deal with the challenges the UK faces as a result of the pandemic. These amounted to a monetary injection offering direct help, which seems to grow with every press conference, with more available if required, but for both businesses and individuals.
For the coming year, statutory sick pay will be available to more people and so will some other social security benefits. Business rates will be reduced or even eliminated for some smaller businesses – at least in the short term.
Small firms will be able to access ‘business interruption’ loans, up to £5million with the first 6 months being interest free. and there will be an improved ‘Time to Pay’ arrangements to help taxpayers affected by COVID-19. Although we still need further details remember this when dealing with HMRC a promise of ‘understanding’ has come from the top. Other immediate support initiatives for smaller businesses include greater access to bank lending, this is worth talking to your bank straightaway and quoting our chancellor now.
The budget was very different, as a result of hurried inclusion of the COVID-19 position. Rishi Sunak did focus on stability and security very early on, together with detailed measures which are very specific to the current situation.
Worst Case Scenario
So now let’s look at preparation for the worst.
Always share your burden. If you have asset finance, contact them as soon as possible and negotiate, and when I say negotiate it is important when dealing with all large corporations, financial institutions and government departments to be the thorn in their side and not let them be the thorn in yours.
There is a story from the old country (Hackney) which tells of a man who was keeping his wife awake by sitting on their bed late at night moaning and wailing. His wife says to him what is the matter, that keeps you awake late into the night? He tells his wife that he owes their neighbour £200 and that he hasn’t got it to give. His wife says to him, that’s an easy one to fix. She opens the window and calls to the neighbour waking him up. She calls to him and tells him that her husband hasn’t got the £200 for him and closes the window. She turns to her husband and says, right now you go to sleep and ley him lay awake worrying. This joke is not a joke though, this is how we should deal with creditors, love and respect them but share the burden!!
the only good thing about a national crisis is that you are not alone, and the economy needs to survive.
There is plenty of advice available for company owners in stressful situations like this, but they usually engender difficult decisions. Th earlier you address it statistically the greater chance of saving the business as a going concern.
You need to plan for reconstruction and recovery. All businesses no matter what size need to make difficult decisions. Most companies in the past that have been saved from insolvency have involved early procedures put in place. Suitably restructured and with a cashflow, means sometimes negotiated debt payments and possibly, unfortunately with a reduced workforce.
Make sure that you are up to speed with government guidance including the COVID-19: guidance for employers and businesses factsheet.
This Budget paper advises what needs to be done if Coronavirus is suspected among any members of staff and details the financial measures that are being made available including:
- Refund for businesses and employers required to access Statutory Sick Pay
- A 100% Business Rates retail discount for one year
- Funding support for those small businesses that pay little or no Business Rates because of Small Business Rate Relief
- The Coronavirus Business Interruption Loan Scheme
- Mortgage payments will be frozen for 3 months to those in difficulty
- A total of £330 billion for businesses needing cash, no news on sole traders yet
- The Chancellor will report on his meeting with the transport minister today
- The business rates are being suspended
- A statutory sick pay relief package for SMEs
- Small business grant funding of £10,000 for all business in receipt of Small Business Rates Relief (SBRR) and Rural Rates Relief
- The Coronavirus Business Interruption Loan Scheme to support long-term viable businesses who may need to respond to cash-flow pressures by seeking additional finance
- The HMRC Time To Pay Scheme
I wish everyone well during these difficult times and please can I make this call to look after your mental good health as well as your financial one in these troubling times.
Coronavirus help for the self-employed
HMRC have just set up a help line specifically for the self-employed who will be struggling now. The coronavirus helpline: 0300 456 3565. They will give you advice on your tax and any benefits you can claim for.
Cases of mortgage repayment holidays are being taken on a case-by-case basis, and the length of any suspension can vary between banks.
Other support for individuals facing financial difficulties owing to the virus includes:
Refunds on credit card cash advance fees
The option of applying for a temporarily increased credit card borrowing limit
Asking for an increased cash withdrawal limit of up to £500
The measures are like those already in place for people facing financial difficulties.
UK Finance, which represents the major banks, said that all banks would consider increasing overdrafts or allowing repayment relief for loan or mortgage repayments for those affected by the virus.
“We would encourage customers who think they may be affected to contact their provider as soon as possible to discuss the support available to them.”
Offering to let personal customers put off paying the mortgage for three months is inherently un-commercial – the sort of thing that would seriously damage your credit record if you did it without agreement. Similarly offering to convert capital repayment loans into interest-only loans for up to a year will cost the banks money.
Because they are expensive, the measures raise practical questions – above all, how will the banks establish that customers are truly affected by the virus rather than other factors? A doctor’s letter? They haven’t answered that question yet.
Sick pay and Benefits
If you’re not eligible for Statutory Sick Pay, because you’re self-employed, you might be able to claim new style Employment and Support Allowance (ESA) if you’re ill, or elements of Universal Credit if you need help with costs like children or housing.
You will no longer have to go to the Jobcentre Plus to claim Universal Credit if you’re advised to self-isolate.
Don’t delay making a claim for benefits, even if you think you might have been affected by coronavirus.
However, if you are already getting any of these benefits being replaced by Universal Credit:
- Housing Benefit
- Tax Credits
- Income Support
- Employment and Support Allowance
and need to make a claim for Universal Credit because of coronavirus, check with the Citizens Advice Help to Claim service as soon as possible to find out how they might be affected and to get advice about your situation.
If you think you’ve got coronavirus
If you have any of the symptoms of coronavirus, such as a cough, high temperature or shortness of breath, it is important you follow the NHS guidelines to protect yourself and prevent the spread of the virus.
If you’ve got coronavirus
If you have coronavirus you are entitled to your workplace’s usual sick leave and pay entitlements.
You would usually have to supply a sick note or fit note from a doctor to do this. But you will now be able to get a sick note by calling the NHS 111 phone line.
If you’ve been told to self-isolate
If you have been to an affected area, been in close contact with someone who has coronavirus, or are waiting for coronavirus test results, you must self-isolate yourself for 14 days.
If you have a persistent cough, fever or flu-like symptoms you should self-isolate for seven days.
You will now be entitled to claim Statutory Sick Pay (SSP) if you’re self-isolating and will be able to get a sick note or fit note by calling NHS 111.
If you need to claim benefits like Universal Credit, you will no longer have to attend a jobcentre if you’ve been advised to self-isolate.
If you’re self-employed, a contractor, work on a freelance basis, in the gig economy or on a zero hours contract, your rights to sick pay and time off are much more limited. If you’re working in the gig economy, check with the company to find out what your rights are.
Unless it has been agreed as part of your contract, you will not be entitled to Statutory Sick Pay, sick leave or paid holiday leave.
If coronavirus means you’re unable to work for any reason and you’ve paid enough National Insurance Contributions, you might be able to claim new style Employment and Support Allowance (ESA) if you’re ill, or elements of Universal Credit if you need help with costs like children or housing.
If you can claim new style Employment and Support Allowance (ESA), you’ll get paid from the first day, rather than after eight days.
If you’re self-employed and need to claim Universal Credit, the rules around the minimum income floor will be relaxed for the duration of the outbreak of coronavirus.
Don’t delay making a claim for benefits if you think you might have been affected by coronavirus.
But you should remember the application process for benefits will be longer than the 14-days recommended for self-isolation.
Find out more about Universal Credit if you’re ill.
Learn more about claiming Universal Credit if you’re self-employed.
Self employed income support scheme
Summary of provisions as per the Chancellor’s announcement
Prepared by Eazitax 17.23 26/03/2020
Coronavirus Payment Scheme
- Pay-out of 80% of Average Monthly Profit of the last 3 years up to £2,500.
- For those under 3 years will look at 2 or 1 year but not less.
- For self-employed up to £50,000 profit
- You must have filed a 2018/19 Tax return
- If not yet filed – must be filed within next 4 weeks
- If newly Self Employed – may not qualify. Unfortunately and will have to look to universal credit
- Payments will be made no later than beginning of June
- HMRC will contact you directly – no need to apply
- Business Interruption Loans can be applied for by Self Employed people
- You can apply for Universal Credit whilst awaiting this grant
- 3 months will be paid at once
Please note this is our understanding of the announcement at this moment in time.
Tax reliefs to support homeworking during the coronavirus situation
The homeworking allowance was increased at the Spring Budget from £4 to £6 a week (or £26 a month) with effect from 6 April 2020. An employer can pay this fixed sum, tax-free and NIC-free, to meet the additional costs an employee incurs working at home under homeworking arrangements.
Homeworking arrangements mean an agreement between the employer and employee (ideally in writing) under which the employee works at home regularly as part of their job, not just informally at weekends or evenings.
During the coronavirus pandemic, HMRC will accept that employees working from home because their employer’s offices have closed – or because the employee is following advice to self-isolate – meet these requirements. Newly home-based employees will be eligible to receive the allowance tax free from the date that their employer agreed they could work from home, or from when government advice was announced.
An employer can pay more than £6 a week, provided there is evidence to support the additional costs incurred. Otherwise any excess will be subject to income tax and NIC. The alternative of an employer agreeing a bespoke scale rate with HMRC is currently improbable.
Additional costs which can be reimbursed include the increased cost of heat, light, insurance, water and telephone or broadband, but not fixed costs such as mortgage interest, rent or water rates.
To be reimbursed tax-free, the employee’s costs must have increased as a result of home working. For example, an employee who is already paying for broadband cannot claim reimbursement for their internet costs simply because they are now working from home. But if they didn’t previously have internet access and now require it, that will be an additional cost.
Where an employer is unable or unwilling to pay the homeworking allowance – or to reimburse in full the employee’s extra costs – can the employee get tax relief for the costs of homeworking?
While there is a specific provision in ITEPA 2003 s 316A for the homeworking allowance, tax relief for homeworking costs is only available under the much stricter general provisions of ITEPA 2003 s336. Costs must be incurred wholly, exclusively and necessarily for the employee’s work.
HMRC will accept that these conditions are met if the employee’s home is a workplace. To be a workplace, the employee’s homeworking must meet four criteria, including that there is no place for them to work at their employers premises and that the employee wasn’t able to choose between working at home or in the office at any time during their contract.
Given the current situation, it is likely that HMRC will accept that an employee can’t work from their employer’s premises, but we haven’t seen definitive confirmation that HMRC will accept that the further condition of lack of choice over working arrangements has been met.
If the four conditions are met, the employee can claim relief for household expenses including:
- Heating and light for the working area
- Metered cost of water used in the performance of duties
- Unit costs of telephone calls
Where a claim is possible, an employee can either keep records and claim relief for their actual costs or claim a fixed amount of £6 a week or £26 a month (£4 a week or £18 a month prior to 6 April 2020) – with an additional claim for the cost of business calls on top.
An employee can make a claim online, by phone, by post or, if they are registered for self-assessment, through their tax return. HMRC has a handy tool to help guide employees to the best approach for them.
Office furniture and computer equipment
Many new homeworkers will have realised by now that working solely on a laptop is intolerable for long periods. Some may have purchased additional monitors, keyboards and even desks and chairs.
If the employer has purchased and provided the necessary equipment then, provided there is no significant private use, no taxable benefit in kind arises. However, if the employee has purchased equipment personally, then any subsequent reimbursement will be to be taxable on the grounds that it is difficult to pass the ‘necessarily’ test. This will be an unwelcome outcome but as yet HMRC has not indicated any proposed relaxation of this position.
Employees will also struggle to obtain relief under capital allowances so employees and employers should consider their position before purchasing equipment.
One solution could be for the employer to pick up any tax bill resulting from the reimbursement by including it in a PAYE Settlement Agreement.