The government has announced some support to help self-employed people through the disruption caused by the coronavirus (COVID-19) outbreak.
We have put together a guide to help you understand which support might be available to you, and how you can access it. One of the benefits of being self-employed is your independence; so it’s totally up to you if you continue to work during the outbreak. If you don’t want to work, just book the time off in your app.
Support you may be eligible for:
- If self-employment was your main source of income between April 2018 and April 2019, you may be able to claim a grant through the Self Employed Income Support Scheme (SEISS). Continuing to work will not affect your eligibility for this scheme.
- If you’re unable to work because of coronavirus, because you’re ill, self-isolating or looking after a sick child, you may be eligible for Employment Support Allowance (ESA).
- If you’re unable to work, or you’re working on a reduced income due to coronavirus, you may be able to claim Universal Credit, or get more money from an existing Universal Credit claim.
Below is more information about each scheme, including how much you may be able to get, and how to apply:
Self-Employed Income Support Scheme (SEISS)
Who is eligible for the SEISS?
If self-employment was the main source of your income in the 2018/19 tax year, and you submitted a tax return, you may be eligible for this scheme. You can see the full eligibility criteria here.
How much is the SEISS worth?
You’ll receive a taxable grant from the government for 80% of your average monthly profits or £2500/month (whichever is lower).
How do I register?
If you’re eligible, and you’ve completed your tax return for the 2018/19 year, HMRC will contact you directly with an online form to fill in, so you don’t need to register.
If you haven’t completed a tax return yet, the government has extended the deadline to 23rd April.
When will I receive my grant?
The government has said that HMRC are working on this right away, with backdated payments expected to begin from early June. You’ll be paid directly into your bank account.
Do I have to stop working to claim this grant?
No, you can continue working if you choose. This won’t have any impact on you receiving a grant.
What if I cannot wait until June?
You can apply for other benefits, such as Universal Credit. You could also consider using any money you have set aside for tax, as payments previously due on 31st July 2020, can now be deferred until 31st January 2021. You do not need to apply for the income tax deferral scheme and there will be no penalties for any payments that are settled between July 2020 and January 2021. You can get more information on that here.
Employment and Support Allowance (ESA)
Who is eligible for ESA?
If you cannot work at all because you’re ill with coronavirus, and have recently paid National Insurance, you might be able to claim contribution-based or ‘new style’ ESA.
You can also claim ESA if:
- you’re not ill but you’re following government guidance to stay at home or ‘self-isolate’ and you can’t work from home
- you’re caring for a child who is ill with coronavirus or has been told to self-isolate
You can check your eligibility for “New Style” ESA, here.
How much is ESA worth?
While the government decide how much you’re entitled to, you’ll normally get the assessment rate for the first 13 weeks:
- up to £57.90 a week if you’re aged under 25
- up to £73.10 a week if you’re aged 25 or over.
After the assessment period, you’ll be assigned to one of two groups and will receive:
- up to £73.10 a week if you’re in the work-related activity group
- up to £111.65 a week if you’re in the support group.
How can I apply for ESA?
If you are eligible for ESA:
- Complete and print an NSESAF1 form. Download it here
- Once you’ve completed the form, call the Universal Credit helpline on 0800 328 5644 (choose option 2) to organise an appointment with a work coach
- They will explain the next steps with your claim
Can I get ESA and Universal Credit at the same time?
You are able to claim both ESA and Universal Credit at the same time. Any ESA payments you receive while claiming Universal Credit will be considered as earnings, and affect your Universal Credit as such.
How long does it take to get ESA?
You should get the first payment into your bank or building society account within 3 weeks.
Can I continue working on ESA?
No - ESA is a benefit specifically for people who are unable to currently work.
If you are unable to work, or your income has reduced because of coronavirus, you may be able to claim Universal Credit, If you already claim Universal Credit, you may be able to get more support. You can apply here.
Who is eligible for Universal Credit?
You can be considered for Universal Credit if you are:
- On a low income or out of work
- 18 or over (there are some exceptions if you’re 16 to 17)
- Under State Pension age (or your partner is)
- Living in the UK
- In a household with less than £16,000 savings
How much is universal credit worth?
The amount of Universal Credit you can claim each month depends on your circumstance. The full amounts are as follows:
- If you're single and under 25 - currently £251.17 rising to £256.05 in April
- If you're single and over 25 - currently £317.82 rising to £323.22 in April
- In a couple and you’re both under 25 - currently £395.20 for both rising to £401.92 in April
- In a couple and either of you are 25 or over - currently £498.89 for both rising to £507.37 in April
If you have children under the age of 16, or look after a qualifying young person under the age of 20, you can also qualify for the child element. This entitles you to an additional:
- £277.08 per month for first or only child born before 6 April 2017
- £231.67 per month per child in all other circumstances
You can only claim the child element for a maximum of two children, unless an exemption, such as a multiple birth applies, or if you’ve adopted.
Depending on your housing situation, you may also receive housing support as part of your Universal Credit payments. This is called your housing payment.
You can use this calculator to estimate the benefits that you are entitled to receive, which has been updated for new guidance on self-employed workers.
Can I still work and claim universal credit?
If you continue to work, then your universal credit will decrease by £0.63 for every £1 that you earn.
There are certain circumstances where you may be eligible for a ‘work allowance’, meaning that you can earn a certain amount before your payments are affected. You can get a work allowance if you are:
- Responsible for a child or young person
- Living with a disability or health condition that affects your ability to work
If you get help with housing costs, your work allowance is £287. If you do not get help with housing costs, your work allowance is £503.
What is a ‘minimum income floor’?
Usually, there is a “minimum income floor” for self-employed workers, which means you will be considered to earn a certain amount based upon the hours you are expected to work and the national minimum wage.
The minimum income floor will be lifted temporarily from 6th April 2020, so only your true earnings will impact your universal credit. You can get more information on that, here.
How long does it take to get Universal Credit?
It can take up to 5 weeks to receive your first Universal Credit payment but you can apply for an advance, which is an interest-free loan paid back through future Universal Credit payments.
To ask for an advance, just log onto your online account you can select the option to apply for an advance payment. If this request is accepted, you’ll usually receive an advance within 5 days, or sooner. You can also call the Universal Credit helpline on 0800 328 5644.
How do I apply for universal credit?
You can apply for Universal Credit online, by registering here.
If you need help completing the online form, you can call the helpline on 0800 328 5644, Monday-Friday between 08:00-18:00.
If you need any help with benefits, the Citizens Advice Bureaux can assist you in getting all the help that you're entitled to. Their service is free, confidential and impartial. You can find their contact details here.
If there is anything else we can help you with right now, don’t hesitate to get in touch.