GOVERNMENT FINANCIAL SCHEMES WHICH NOW BENEFIT FREELANCERS
We’ve collated all of the government emergencies policies which, in some way benefit or offer help to freelancers set up as both Ltd companies and Sole traders on PAYE.
It’s clear that freelancers will not be able to supplement their earnings in a way that’s even close to what they would have earned but this period is about surviving through the financial crisis finding a way to live on a very basic allowance until things get better – they will get better.
Taking a mortgage holiday, holding back on tax payments, claiming SSP or Universal Credit, cancelling all non-essential costs from your personal budget, claim for private renting assistance, defer VAT payments and others credits card/loan payments.
Reducing your costs which may include childcare, spending little (there isn’t much to spend on), we should be able to ride the storm for a little while until some equilibrium is restored. Cancel everything which is non-essential at this time or ask for a reduction in fees.
Take five minutes and work out what you are saving without paying for transport, coffees, lunches, nights out, a quick pint down the pub, gym memberships, subscriptions and rather than focus on money coming in, see how much you can stop for going out – it’s very positive task for the mind.
There are loads of apps that do the same job.
Here are the latest government emergency finance plans as of Friday 20th March:
This COVID-19 Fact sheet from the government covers every detail of the new rules designed to help the UK working population with all the details of where to go to make calims and find further advice..
For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.
HOW TO ACCESS THE SCHEME
This is an automatic offer with no applications required.
No penalties or interest for late payment will be charged in the deferral period.
80% WAGES PAYMENT
If you are an employee of your limited company paid usually the minimum wage of £12,500 you may be able to claim for the 80% wages supplement if you are on the payroll of the company.
Many Ltd company set ups see the non-taxable limit paid to employees for the Ltd company in addition to dividends. Have a look in to this – this is not confirmed but a possibility to discuss with your accountant
FOR PAYE FREELANCERS
If your employer cannot cover staff costs due to COVID-19, they may be able to access support to continue paying part of your wage, to avoid redundancies.
If your employer intends to access the Coronavirus Job Retention Scheme, they will discuss with you becoming classified as a furloughed worker. This would mean that you are kept on your employer’s payroll, rather than being laid off.
To qualify for this scheme, you should not undertake work for them while you are furloughed. This will allow your employer to claim a grant of up to 80% of your wage for all employment costs, up to a cap of £2,500 per month.
Find more information here:
SICK PAY ENTITLEMENT – SSP
You can get £94.25 per week Statutory Sick Pay (SSP) if you’re too ill to work. It’s paid by your employer for up to 28 weeks.
If you are staying at home because of COVID-19 you can now claim SSP. This includes individuals who are caring for people in the same household and therefore have been advised to do a household quarantine.
For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.
HOW TO ACCESS THE SCHEME
This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period.
Eligibility: All UK businesses are eligible.
SUPPORT FOR BUSINESSES THROUGH THE CORONAVIRUS BUSINESS INTERRUPTION LOAN SCHEME
A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to support primarily small and medium-sized businesses to access bank lending and overdrafts.
The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value.
Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments.
Apply for business interruptions loans here from 23rd Match 2020
HELP FOR PRIVATE RENTERS:
Emergency legislation will be taken forward as an urgent priority so that landlords will not be able to start proceedings to evict tenants for at least a 3 month period. As a result of these measures, no renters in private or social accommodation needs to be concerned about the threat of eviction.
UNIVERSAL CREDIT CLAIMS
If you need to claim Universal Credit but have COVID-19 or are self-isolating, you will now be able to claim and to access advance payments upfront without needing to attend a Jobcentre Plus. Please visit https://www.gov.uk/universal-credit for more information.
There is one standard allowance for your household: Single claimant aged under 25: £251.77 per month. Single claimant aged 25 or over: £317.82 per month. Joint claimants both aged under 25: £395.20 per month.
Start your claim here:
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