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Self-employment Income Support Scheme

Question for Treasury

UIN 115727, tabled on 16 November 2020

To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential merits of extending eligibility for the Self Employment income Support Scheme to people for whom self-employment makes up over half of their income following the loss of other employment during the covid-19 outbreak.

Answered on

19 November 2020

Unlike for employees, self-employed income is not reported monthly, but at the end of each tax year on the individual’s Income Tax Self Assessment return. To protect the Exchequer from fraudulent activity, this means that the most reliable and up-to-date record of self-employed income is from 2018-19 tax returns.

The self-employed are very diverse and have a wide mix of turnover and profits, with monthly and annual variations even in normal times, and in some cases with substantial alternative forms of income too. The design of the SEISS, including the eligibility requirement that an individual’s trading profits must be at least equal to their non-trading income, means it is targeted at those who most need it, and who are most reliant on their self-employment income.

The Government does acknowledge that it has not been possible to support everyone as they might want. Those ineligible for the SEISS Grant Extension may still be eligible for other elements of the support available. The Universal Credit standard allowance has been temporarily increased for 2020-21 and the Minimum Income Floor relaxed for the duration of the crisis, so that where self-employed claimants' earnings have fallen significantly, their Universal Credit award will have increased to reflect their lower earnings. In addition to this, they may also have access to other elements of the package, including Bounce Back loans, tax deferrals, rental support, mortgage holidays, self-isolation support payments and other business support grants.

Answered by

Named day
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