Self-employed parents have less than a week to claim coronavirus grants worth £14k
SELF-EMPLOYED parents have less than a week to claim coronavirus grants worth up to £14,000 if they weren't previously eligible for them.
Under the original self employment income support scheme (SEISS) rules, new parents who didn't submit a 2018/19 tax return, or posted trading profits that were less than 50% of their income, couldn't claim the help.
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But new rules, which were first announced in June and came into force in August, mean these parents can now apply.
HMRC will instead use their 2016/17 and 2017/18 tax returns to work out their eligibility.
You meet the criteria so long as you were either pregnant, gave birth, caring for a child under the age of one, or had adopted a child who had been with you for less than a year.
New parents will also need to have been self-employed in 2017/18 and submitted a tax return for the year before April 23, 2020, as well as meeting certain other requirements - see for the full list.
Self-employment grant: who can claim?
YOU can claim if you're a self-employed individual or a member of a partnership and you:
- have submitted your self assessment tax return for the tax year 2018/19
- traded in the tax year 2019/20
- are trading when you apply, or would be except for coronavirus
- intend to continue to trade in the current tax year (2020/21)
- have lost trading profits due to coronavirus.
To apply, new parents need to fill out an asking for HMRC to verify the information about their new child before Monday October 5, 2020.
You'll need your child's full name and date of birth, the date of adoption, child benefit number, your child's birth certificate and you should tell HMRC know if you're claiming maternity allowance.
HMRC will let you know within two weeks if you're entitled to claim both grants or just the second payout.
But while this will help some families, charity Maternity Action says new parents are still likely to be missing out as the SEISS doesn't take into account reduced or lost wages while workers take time off work to care for new children.
Ros Bragg, director of Maternity Action said: "No more than a few hundred self-employed parents will have benefited from the minor tweak to the SEISS rules in June.
"In contrast, as many as 70,000 people – mostly mothers – have already lost out due to government refusal to discount periods of time out to care for a new child during the three-year SEISS assessment period."
HMRC couldn't tell us how many people will benefit from the SEISS rule change.
HM Treasury says it has provided over 2.6million self-employed people with £7.8billion of support under the first SEISS grant, while so far the second SEISS grant has received nearly 2.2million applications worth £5.6billion.
A HM Treasury spokesperson added: “We recognise the continued challenge facing self-employed people, which is why we’ve extended our Self-Employment Income Support Grant Scheme to support millions of self-employed right through to April next year.”
What help is out there for businesses and self-employed workers?
THE government has introduced the following measures to help self-employed workers and businesses during the coronavirus outbreak:
Income-tax deferrals: Self-assessment income tax payments, that were due in July, can be deferred to the end of January next year.
Rent support: Businesses who are struggling to pay their rents are protected from eviction until the end of June.
Coronavirus business interruption loan scheme: SMEs can get loans and overdrafts of up to £5million for up to six years and the government will guarantee up to 80 per of these.
Grants of up to £10,000: Small firms can get grants of up to £10,000 to help with ongoing business costs.
VAT payments: VAT payments can be deferred for three months.
Tax bill help: SMEs that cannot afford their tax bills can ask HMRC for a “time to pay” arrangement so any debt collection is suspended.
Business rates holiday: A 12-month business rates holiday has been introduced for many businesses.
What is the self-employed grant?
The SEISS is the government's alternative to furlough for self-employed workers whose businesses have been adversely affected by the coronavirus crisis.
Applications for the first SEISS grant, worth up to £7,500, closed on July 13 but parents covered by this tweak to the rules may still be able to claim the payout.
This is on top of a second SEISS payout worth up to £6,570 that's available to claim until October 19, 2020.
In total, it means new parents may be entitled to help worth more than £14,000.
How much you get under the scheme is dependent on your trading profits between the 2016/17, 2017/18, and 2018/19 tax years.
Only those who made less than £50,000 a year in profit can apply and you also needed to have traded in the 2019/20 tax year, and been intending to trade in the 2020/21 tax year too.
You don't have to pay the grants back but they will be classed as income so you'll have to pay tax on them, and they will affect your Universal Credit if you claim the help.
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Two new grants for self-employed workers have also since been announced by chancellor Rishi Sunak.
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The first will cover November to January and will pay up to £1,875, while the second will cover an as yet undisclosed amount between February 2021 to the end of April 2021.
But the scheme has been criticised as among those excluded are limited company directors.