Coronavirus: What help can freelance workers get?
Whether you work through a PSC, other limited company, umbrella company or are self-employed, will affect what sick pay support you are entitled to during the Covid-19 pandemic.
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The Coronavirus Bill already seems to include amendments for statutory self-employment pay at 80% of a monthly average based on the last 3 years with a cap at £2,917, help should hopefully be on the way for the self-employed:
https://publications.parliament.uk/pa/bills/cbill/58-01/0122/amend/coron...
Page 14.
@martin, that is disinformation.
Its a lib-dem amendment which has been rejected by Rishi.
https://www.bbc.co.uk/news/business-52021299
Edited to add - I get a *snap* with Rebecca.
Thanks for clarifying I am sharing what a lawyer emailed to me - I did say "hopefully!"
What on earth did the Libdems think they were going to achieve with a poorly drafted amendment which they were well aware would fail ? Three clients picked up on this spoof story and had already spread the word to others too
Pathetic and time wasting beviour from so called politicians
"Falsehood flies, and truth comes limping after it" (Mark Twain)
Most won't value much of the above support they will want to know about this:
https://publications.parliament.uk/pa/bills/cbill/58-01/0122/amend/coron...
Yes exactly, bigger support for this group is being worked on which is what people will be interested in. Fingers crossed they don't make it too much of a hash of the implementation.
Even if you are entitled to ssp via an umbrella company anyone who took a year off for any reason or didn't work for 26 weeks in either of the last 2 years(semi retired?) wont get it.
HMRC think that all self employed fiddle (which of course they do not). As such no doubt HMRC are struggling to justify supporting people who do.
Of course, it's totally hypocritical for any self employed person who has fiddled expenses, done cash jobs, suppressed takings etc and denied the Government tax monies to then want the Government to bail them out. And then no doubt go back to their dodgy ways.
Good analysis & explanation, Rebecca, thank you.
With the closure of parliament after today, I wonder how they are going to enact any support for the self employed?!
And I agree with another poster, if you dont pay your club membership fees (tax!) dont expect the club benefits.
Good analysis & explanation, Rebecca, thank you.
With the closure of parliament after today, I wonder how they are going to enact any support for the self employed?!
And I agree with another poster, if you dont pay your club membership fees (tax!) dont expect the club benefits.
THe last point I saw on this suggested that the UK was looking at the scheme suggested I think in DEnmark.
That is the amount paid to the self employed person would be based on the net proft (I assume before capital allowances) averaged over the last 2 or 3 years. 80% of result probally with an upper limit. All those who have cash jobs wont get a penny more and all those who have not registered will get 0 .
One of my contacts thinks there will be a big shake up in the area once we exist the crisis.
I really hope they find a solution to this but that poorly drafted bill wouldn’t have been of much help - even if it had passed (which it was never going to do) as it would take time to prove what our self employed income was over a 3 year period.
I suspect the reason they didn’t announce anything for the self employed and freelancers at the outset is because of the practical difficulties to decide how much each person should get and how to get it to them.
With employees there is third-party (employer) evidence of salaries paid through PAYE and, in the main these are constant.
That’s the theory anyway.
The problem with the self employed is that our income can fluctuate from week to week, month to month and year by year. There is no easy to access independent evidence of what would be a fair starting point.
Even if you say HMRC has the records of the last 3 years, their systems aren’t set up to extract this data automatically. And a rule would be required for those who have been self employed for less than 3 years. And so on.
Having said that, I did see a FinTech entrepreneur saying in the Sunday Times that he’d created a solution using open banking that would pick up on banked income over the last 3m. He was hopeful the Govt would look at this as a way of evidencing self employed income.
Some clients of mine such as those that provide gardening services or others that work outside, have incomes that are seasonal. [***] we are just coming out of winter they would be disadvantaged. However saying that it is impossible to find a solution that is completely fair for everyone, and some income is better than none.
Is there a distinction between the Limited Company Contractor (LCC) issues described here where those in this classification work on a contract basis and your standard single company director who have a wide ranging client base with no contract to contract situation.
I am trying to establish the entitlement under the Coronavirus provisions for many directors of this type of company who are mainly micro businesses?
Grateful for any help on this as it does not seem to be covered anywhere.
Many thanks Rebecca. If these company directors don't have employed status then it seems to follow that they are classed as self-employed? Would that assumption be correct?
If so they will be affected by the Govt. scheme to be announced today. I suspect HMRC may still class them as employed though.
Any thoughts?
The self-employed are allowed to defer the July PoA income tax/NI class II/IV to Jan 2021, presumably this doesn't include those who are contractors via a LTD Co? They consider themselves to be self-employed, are they allowed to defer the July PoA?
The official HMRC announcement on tax deferral only mentions self assessment payments on account. It does not refer specifically to self-employed.
https://www.gov.uk/government/publications/guidance-to-employers-and-bus...
So after Sunak's announcement, LCC's get no Job Retention scheme payments, no self employment help, nothing?
How long will it be before sole-traders realise that the future increase in National Insurance will effectively make them pay the money back......Haven't the Government just got what they always wanted but too afraid to do!
Looking at the latest HMRC guidance about the Self-employed, at the end it says:
"If you’re a director of your own company and paid through PAYE you may be able to get support using the Job Retention Scheme."
Here is a link:
https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-...
Surely HMRC are giving the green light for directors of limited companies?
Thoughts anyone?
Is this a mistake I wonder as the link takes you to Support for businesses through the Coronavirus Business Interruption Loan Scheme?
Hi Rebecca
I am very confused by the government bail out? I am not sure I qualify for anything? The 5% highlighted by the Chancellor.
I was a limited company up to 2018 Paul Holmes 8115 LTD. 2018/19 I worked through an Umbrella company My Key Pay. I did not make my tax threshold , so HMRC advised me to not submit a tax return on my online account. This year 19/20 I again have not met my threshold and am still with the Umbrella company. Work has been slow and week to week really. I have registered in the last week and have again become a Ltd and take on Paul Holmes 8115 LTD and the idea is to work for myself again and revamp my company before returning to work, once allowed
Will I qualify for any of the bail outs by the government?
Thank You
Rebecca, can you help? I have worked as a Contractor for the last year and half through an umbrella company and have paid over £40K of my income (through PAYE) in Employer's NIC, Employee's NIC and Tax. My last contract ended on 28 February (not Coronavirus related, just the planned end of the contract). I cannot work out if I am entitled to any help from the government.