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Coronavirus help: grants for self-employed workers

Coronavirus help: grants for self-employed workers
Image source: Getty Images

On 9 October, the chancellor announced new financial support measures to help businesses through the Covid-19 crisis. But how do these measures help the self-employed, and how do you apply for support?

Well, the good news is that grants for self-employed workers are still available, and it’s easy to apply. Here’s what you need to know.

Grants for self-employed workers

The main grant designed to support self-employed workers right now is the Self-Employment Income Support Scheme (SEISS). Let’s go over how it works. 

First, it’s a grant, not a loan, meaning you shouldn’t need to pay it back. So what are you entitled to?

Well, the first SEISS grant gave you up to 80% of your average monthly profits over the last three tax years. The second grant is a little lower – you can only claim up to 70% of the monthly average over three years. There’s also a cap of £6,750, meaning you can’t claim more than this even if your monthly average is higher.

You’re eligible to apply if you are self-employed and:

  • Filed your 2018-2019 tax return
  • Traded in 2019-2020 
  • Plan on continuing to trade in 2020-2021
  • Earn at least 50% of your income from self-employment

If you don’t have three years’ worth of tax returns, you might still be eligible. HMRC can tell you more.

How to apply

You can apply for a SEISS grant online on or before 19 October 2020. If you miss this deadline, HMRC won’t process your application (although you can still apply for other support).

So, to get started, you’ll need your:

  • Government Gateway password and ID 
  • Self-Assessment Unique Taxpayer Reference (UTR) 
  • National Insurance number
  • Bank details 

Just complete the online application and wait for HMRC to get back to you. If you can’t claim this grant for self-employed workers online, ask HMRC what to do next.

Once HMRC approves your claim, it can take around six days to receive the grant money. If you’re unhappy with the amount you’re awarded, you can always give them a call. 

Grant extensions

We’re expecting a third and fourth round of SEISS grants, but not all of the details are available yet. All we know is that:

  • Grant three covers the period from November 2020 to January 2021
  • You can claim for up to 20% of your monthly profits (to a maximum of £1,875)
  • To apply, more than 50% of your income must come from self-employment 
  • The fourth grant covers February 2021 to April 2021 

It’s likely that grant four will be less generous, but the eligibility criteria may be the same. 

So if you’re not applying for the October grant, you may be able to apply for the third or fourth round if you need the support.

Other support available

Missed the cut off date or not eligible for a SEISS grant? Don’t worry. Here are some other loans and grants for self-employed workers that you may be entitled to. 

Time to Pay

If you can’t pay your 2019-2020 tax bill by 31 January 2021, you can apply for extra time to pay.   

  • If you owe less than £30,000 in tax, you’re eligible to apply for the scheme.
  • You can spread the payments out over 12 months. However, you’ll need to pay 2.6% interest on the outstanding balance after 31 January 2021. 
  • Make sure your other tax returns are up-to-date. In other words, if you owe tax for previous years, you can’t use Time to Pay. 
  • If applicable, you can also defer VAT payments until the 2021-2022 tax year. 

Not sure you’re eligible for the scheme, but struggling to pay your tax bill? Contact HMRC. They’ll try to help as much as they can. 

Business Interruption Loan Scheme

Small businesses affected by coronavirus can apply for a Business Interruption Loan. The UK government has confirmed the self-employed can apply, too. So while this isn’t a grant for self-employed workers, it’s still a support option.

  • You can borrow up to £5 million.
  • The UK government pays the first 12 months’ interest for you.
  • You can’t use the scheme if your turnover exceeds £45 million. 

Check out the panel of lenders you can choose from here.

Bounce Back Loan

Self-employed small business owners can borrow up to 25% of their usual turnover through this lending scheme. 

  • The loan lasts for six years. There’s no fee if you pay it off early. 
  • You won’t pay interest for 12 months.
  • After the first 12 months, you pay annual interest of 2.5%. 
  • You can’t claim if you’re already getting a Business Interruption Loan.

You can apply for the Bounce Back Loan here.


Grants for self-employed workers are a lifeline for many businesses right now. Just remember to keep accurate financial records to prove why you need the support – if you claim more than you need, you’ll need to pay the excess back. And, you’ll probably incur a financial penalty. 

If you’re not sure what support to apply for, or you’re struggling with debt more generally, get financial advice first. 

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