Chancellor Rishi Sunak has announced new measures to help the self-employed - likely to be welcomed by self-employed estate agents.
The Chancellor has stressed the complexity of identifying the appropriate self-employed, and the difficulty of implementing these measures - many may not be accessible until June.
In summary the proposals are:
- The government will pay self-employed people whose businesses have been adversely affected by Coronavirus, a taxable grant worth 80 per cent of their average monthly profits over the last three years, up to £2,500 per month (note this is 80 per cent of average profits - not earnings);
- It’s only available to those with trading profits up to £50,000 who make a majority of their income from self-employment;
- To minimise fraud only those already in self-employment who have a tax return for 2019 can apply;
- Some 95 per cent of self-employed will benefit from this scheme;
- Self-employed can now access Business Interruption loans;
- Self-employed income tax payments due in July can be deferred to the end of January 2021;
- and the self-employed can access Universal Credit in full.
It is thought that the self-employed with their own companies, who pay themselves in dividends rather than salary, may find it difficult to benefit from the new measures.
However, Sunak made it clear that a price to be paid by the self-employed - once the virus crisis is over - will be that they will no longer have what some see as tax and National Insurance advantages.
Increasing numbers of agents have self-employed status - notably those working for many online estate agencies, some franchise holders, and those agents working through hybrid 'hubs' that have set up in recent years.
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The devil will clearly be in the detail here.
Lots of the newly "self employed" will simply not have traded long enough to qualify or will not have been making "profits"
Those of us who are effectively self employed but have limited companies and take earning via PAYE and dividends seem at risk, We can't furlough ourselves as Directors.
£50,000 of profits - what type of profits - gross, net?
Looks like a few hours will need to be spent pouring over the detail but, well done to the Government on continuing to try and support people through this unprecedented time.
We have to merge self employed and employed tax treatment - we are all in this together - employed and high commissions may be way forward
Key point missed here:
1. no actual payments until June. (So at least 60 more days or so to get though with no help)
2. HMRC will automatically contact those who are eligible, request a form to be filled in, and will pay money directly in to bank account when complete.
3. The £50,000 figure refers to taxable income declared (not turnover).
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