Government Doubles Help for Self-Employed but Many Won’t Benefit

4th November, 2020
By 4. November 2020COVID-19, News
Government Doubles Help for Self Employed but Many Won’t Benefit

Boris Johnson has announced the government will double the level of financial support for self-employed workers during the second lockdown. However, there’s no change to the eligibility criteria meaning that many will continue to fall down the gaps.

The prime minister said the self-employment income support scheme (SEISS) would be increased from 40% of average profits to 80% in November. People who work for themselves will be able to apply from the end of the month – rather than the middle of December as initially planned – to help provide support faster during the second lockdown in England.

It comes after the government announced an extension to the furlough scheme for employees at the last hour, which will also now subsidise 80% of workers’ wages through to March with a review expected in January. Rishi Sunak confirmed that the increase in help for the self-employed would be to an average of 55% of trading profits over the wider period from November to January, while the maximum grant available would increase to £5,160. The chancellor also confirmed that the deadline for businesses to apply for a Treasury-backed loan had also been further extended until 31 January

Sunak said: “The rapidly changing health picture has meant we have had to act in order to protect people’s lives and I know this is an incredibly worrying time for the self-employed. That is why we have increased the generosity of the third grant, ensuring those who cannot trade or are facing decreased demand are able to get through the months ahead.”

Business groups welcomed the additional measures but warned that millions of people were slipping through the gaps, including the newly self-employed and people who had lost their jobs. Contractors who pay themselves a salary and dividends through their own company are not covered by the SEISS scheme – although they will have some of their salary covered by job retention schemes if they operate through PAYE.

Adam Marshall, the director-general of the British Chambers of Commerce, said: “Despite this extension, there are still many businesses and individuals who have, through no fault of their own, not yet been able to access any government support since the start of the pandemic. They too will require help to sustain their businesses and avoid further increases in unemployment.”

Despite the blow to business, some companies are still hiring, especially in the lead up to Christmas. For the latest news on hiring and vacancies, read our article here. If you’re starting a new contract, ContractingWISE has a range of hassle-free services that can help you set up a fast and efficient payroll. To talk to a member of our team, call: 0203 642 8679