MILLIONS of self-employed workers will be able to claim grants worth up to £3,750 from the government.

Chancellor Rishi Sunak confirmed he was doubling the amount of support the government will give struggling businesses in an update in the House of Commons today.

Chancellor Rishi Sunak in the House of Commons today

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Chancellor Rishi Sunak in the House of Commons today

The government previously said it would cover 20% of average monthly profits, up to a total of £1,875, covering November to January next year.

But it will now increase this amount to 40%, meaning the maximum grant is now worth £3,750.

An additional second grant will also be available for self-employed workers to cover February 2021 to the end of April.

The government hasn’t said how much this second grant will cover.

Today, the Chancellor announced:

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What help is out there for businesses and self-employed workers?

THE government has introduced the following measures to help self-employed workers and businesses during the coronavirus outbreak:

Income-tax deferrals: Self-assessment income tax payments, that were due in July, can be deferred to the end of January next year.

Rent support: Businesses who are struggling to pay their rents are protected from eviction until the end of June.

Coronavirus business interruption loan scheme: SMEs can get loans and overdrafts of up to £5million for up to six years and the government will guarantee up to 80 per of these.

Grants of up to £10,000: Small firms can get grants of up to £10,000 to help with ongoing business costs.

VAT payments: VAT payments can be deferred for three months.

Tax bill help: SMEs that cannot afford their tax bills can ask HMRC for a “time to pay” arrangement so any debt collection is suspended.

Business rates holiday: A 12-month business rates holiday has been introduced for many businesses.

Businesses will be eligible for the new help if they previously qualified for the self-employment income support scheme (SEISS) and if they’re actively trading, even if they’re facing reduced demand.

Speaking today, the Chancellor said the additional support from the government was worth £3.1billion.

Mr Sunak said: “We are doubling the next round of the income support to 20% to 40% of incomes.

“We have now provided over £13bn support to self-employed workers. This government is on their side.”

“This is our plan for jobs, for businesses, for regions, for the economy. A plan to support the British people.”

Who can apply?

To apply for the scheme you must meet the following criteria:

  • Eligible for SEISS at the moment – although, you don’t have to applied for previous grants
  • Still actively trading and intend to continue to trade
  • Experienced reduced demand due to Covid from November 1 until date of claim (for first grant)

The grant is subject to income tax and National Insurance Contributions.

How did the self-employed grant scheme work before?

The first SEISS grant was worth 80% of three months’ profits up to a cap of £7,500 in total, or £2,500 per month.

While the second grant covered up to 70% of profits over three months again, worth up to £6,750 in total.

For the previous grants, only those who made less than £50,000 a year in profit between the 2016 and 2018 tax years were eligible to claim the funds.

SEISS has helped around 2.6million self-employed small businesses get back on their feet following the coronavirus pandemic.

The government hasn’t said when applications will open for the new set of SEISS grants – but HMRC will provide updates on the gov.uk website.

More to follow…

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