Supporting self-employed workers

Further measures to support self-employed people have been announced... 

The Government know many self-employed people are deeply anxious about the support available for them. That is why the Chancellor has announced a new Self-Employed Income Support Scheme – helping many of our country’s self-employed workers: the musicians, the sound engineers, the plumbers, the electricians, the taxi drivers, the hairdressers, the childminders, the driving instructors, and many others.

Through this scheme, the Government will pay self-employed people a grant worth 80 per cent of their average monthly profits over the last three years, up to £2,500 a month – that’s unlike almost any other country and makes our scheme one of the most generous in the world.

We know there are challenging times ahead, but we are confident that the measures we have put in place will support millions of people, businesses and self-employed workers to get through this, and emerge on the other side both stronger and more united as a country. And we will get through this together.

Self-Employed Income Support Scheme

  • The Government will pay self-employed people across the whole UK who have been adversely affected by coronavirus a grant worth 80 per cent of their average monthly profits over the last three years, up to £2,500 a month, for three months – but it will be extended for longer if necessary.
  • The Government will make it simple for self-employed people to get the financial support they need. Self-employed people who are eligible will be contacted by HMRC directly, asked to fill out a simple online form, and HMRC will pay the grant directly into their bank account. We expect people to access the scheme by the beginning of June.
  • We are ensuring our support reaches those self-employed people who are most in need of it. The scheme will only be open to those with trading profits up to £50,000, leaving 95 per cent of people who are majority self-employed eligible for the scheme. HMRC will also ask people to demonstrate that the majority of their income comes from self-employment, and, to minimise fraud, only those who are already in self-employment, and who have a tax return for 2019, will be able to apply.

Q: Why are you making this change now?

We have already announced unprecedented measures to support people and businesses. These include the Coronavirus Interruption Loan Scheme set out at the Budget, and last week we announced £330 billion of loans and guarantees for businesses and a £7 billion boost to our welfare system, among others.

We have been working with the Federation of Small Businesses, the association of Independent Professionals and the Self-Employed, and the Trades Union Congress. Now we will give assurance.

Providing such unprecedented support for self-employed people is operationally very challenging. The self-employed are a very diverse population. They have a wide mix of different levels of income, which even in normal times can vary hugely from month to month.

Q: Support not available until June?

HMRC are working day and night to get this scheme up and running. HMRC are also delivering other key schemes to a similar timescale, including the Coronavirus Job Retention Scheme and the Statutory Sick Pay rebate for employers. The Self-Employed Income Support Scheme also allows late tax filers a month to get their 2018-19 tax returns in within 4 weeks of the announcement of the scheme, which also creates some delay.

More information about the Self-employment Income Support Scheme:…


Previous measures already announced...

On 20 March 2020, the Chancellor strengthened measures to help those who are self-employed. This includes strengthening the safety-net for the self-employed, who will benefit from a relaxation of the earnings rules under universal credit and deferring income tax self-assessment payments due in July 2020. 

  • We have already made access to both Universal Credit and ESA more generous and accessible – for example by increasing the UC allowance by £20 per week. 
  • We have temporarily removed the 7 waiting day requirement in ESA and we have relaxed Universal Credit’s Minimum Income Floor for all self-employed people.
  • We are also deferring income tax self-assessment payments from July to January next year to help those who are self-employed.  

Providing self-employed people with a safety net: 

Supporting people through the welfare system so that nobody is penalised for doing the right thing. We will make it quicker and easier to access benefits. Those on contributory ESA will be able to claim from day 1, instead of day 8. And we are relaxing the requirement for anyone to physically attend a jobcentre – everything can be done by phone or online. 

Suspending the minimum income floor for twelve months – meaning self-employed people can now access, in full, Universal Credit at a rate that is equivalent to Statutory Sick Pay for employees. For the self-employed, we are also deferring income tax self-assessment payments for July until the end of January 2021. 

Strengthening the safety net for those who need it – increasing Universal Credit and Working Tax Credit by £1,000 a year – a cash injection of nearly £7 billion in the welfare system. We are increasing the Universal Credit standard allowance, for the next 12 months, by £1,000 a year. We will also increase Working Tax Credit by the same amount for the next 12 months. 


Supporting small businesses: 

Providing grants to the smallest of businesses of £10,000. We are providing £10,000 grants to the 700,000 of our smallest businesses. 

Deferring the next three months of VAT tax, a direct injection of over £30 billion of cash to employers, equivalent to 1.5 per cent of GDP. That means no business will pay any VAT from now until the end of June, and they will have until the end of the financial year to repay those bills.

The Coronavirus Business Interruption Loan Scheme will now be interest free for twelve months, an extension from the initial announcement of six months. We have already introduced and announced an extension to the Business Interruption Loan Scheme, which is for small and medium-sized businesses. On Tuesday, the Chancellor expanded the amount that can be borrowed from £1.2 million to £5 million, and we are now extending the time frame of no interest on these loans from six months to twelve months.


Helping people with the cost of living during this time: 

Introducing emergency legislation to protect renters, so that no one gets evicted if they cannot pay their rent. Emergency legislation will be taken forward as an urgent priority so that landlords will not be able to start proceedings to evict tenants for at least a three-month period. As a result of these measures, no renters in private or social accommodation needs to be concerned about the threat of eviction.  

Announcing nearly £1 billion of support for renters, by increasing the generosity of housing benefit and Universal Credit, so that the Local Housing Allowance will cover at least 30 per cent of market rents in local areas. 

Introducing a three-month mortgage holiday for those in difficulty due to coronavirus – so that people will not have to pay a penny towards their mortgage while they get back on their feet. And in the coming days, we will go much further to support people’s financial security. We will work with trade unions and businesses to develop new forms of employment support to help protect people’s jobs and incomes through this period. 

Introducing new emergency measures with the energy industry to keep gas and electricity flowing, looking after vulnerable customers who may be in financial difficulty due to Covid-19. Any household in financial distress will be supported by their supplier so that their energy does not get cut off.