Questions and Answers from business about Covid 19 financial support

There are many questions which no one can give a definite answer to yet. To give an idea the Taxes Acts cover tens of thousands of pages and don’t cover every situation, the guidance on HMRC for the Business Support covers barely two pages.

How do I apply for the self employed support grant?

HMRC will contact you if they consider you are eligible and will send an application to you. You complete  and return to HMRC who  will then notify you of how much you will be entitled to claim.  HMRC will ask you to apply on line via .gov.uk, I would suggest you register for personal tax account just in case it has to be accessed  through this

https://www.gov.uk/personal-tax-account

When will I receive the money ?

The current plan is to have the the scheme running in early June so I would hope in June if not earlier depending on how long it takes to write the software

stopped one self employed business and started a new one in 2019/20, will I still have the grant?

HMRC talk about self employed income for 2017 to 2019 but don’t mention this they only talk about self employed taxable profits, so hopefully the answer is yes

What tax will I pay on the grant?

The chancellor announced that the grant would need to be declared on your 2020/21 tax return and tax would be due, it would appear it has to be declared as part of your self employed income and so if you are liable then Income Tax and Class 4 national Insurance would be due

Will I have to pay it back ?

HMRC website simply says “…have lost trading/partnership trading profits due to COVID-19” there is no guidance as how they can possibly check this when your 2020/21 tax return is submitted and there is no mention of claw back in the guidelines

What if I have stopped self employment in 2019/20?

HMRC website  says

“you are trading when you apply, or would be except for COVID-19

you intend to continue to trade in the tax year 2020-21”

If you ceased now or after the lock down and don’t intend to continue then it would mean you won’t be eligible for the grant

Can I claim the “furlough support” if I operate as a one person limited company?

Yes you can, but you have to stop working for the company so effectively the company would have to cease trading temporarily. Not surprisingly you can comply with legal obligations as you would still have to file your VAT returns, RTI PAYE returns etc.

This is 80% of your salary, not dividends , its payable to the company to enable it to pay all or part of  your salary. The scheme should be open for applications at the end of April 2020

Can I claim under these schemes if I have a partner who is still employed and receiving full salary?

There is no mention of any restriction for other household income it is all directed at each person as individuals and so as far as I can ascertain there should be no impact on your claim

I claim benefits will these impact the grant?

Its considered taxable trading income and so it would be notifying when the updates are submitted for Universal credit

 

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