SELF-EMPLOYED workers impacted by coronavirus will be able to apply for a grant of up to £2500 a month from the Government - but they’ll have to wait at least three months before they receive the cash.
Details of the new package were unveiled by Chancellor Rishi Sunak at the daily briefing in Whitehall.
He said self-employed people will be able to apply for a grant worth 80% of their average monthly profits over the last three years, up to £2500 a month, for at least three months, and longer if necessary.
Even though it won’t pay out until June, the scheme will be backdated to March, with the money for all three months arriving in one lump sum.
Sunak said the self-employed would be able to claim and continue to do business. He also said the government had made it easier now for the self-employed to apply for universal credit.
The Chancellor said: "It's only open to those with trading profits up to £50,000, who make a majority of their income from self-employment."
He added: "95% of people who are majority self-employed will benefit from this scheme.
The grants will be taxable, and will need to be declared on tax returns by January 2022.
To be eligible an applicant will have to show that at least half their income comes from self-employment, either from their 2018-2019 tax return or averaged over the three previous years.
That could cause problems for the newly-self employed - those who have not yet filed a tax return.
Sunak said the Treasury would look at what they could do but warned that they would struggle if there were no accounts.
In his statement, the Chancellor also warned that following the outbreak, the self-employed would have to pay the same amount of tax and national insurance as the employed.
"I must be honest and point out that in devising this scheme in response to many calls for support, it is now much harder to justify the inconsistent contributions between people of different employment statuses," said the Chancellor.
"If we all want to benefit equally from state support, we must all pay in equally in future."The Treasury will contact those eligible for the Coronavirus Self-Employment Income Support automatically, he said.
Responding to the Chancellor’s statement, Ian Blackford said the three month wait for "people with bills to pay and families to feed" was "extremely concerning".
He added: “Many self-employed people rely on a regular flow of income, including thousands from low-income households and key workers, and they need support now. However, the Chancellor’s delayed plans fail to deliver for many households already in difficulty.
"While they are being forced to wait for months, they are also being asked to apply to a Universal Credit regime which continues to have a five week wait. This is unacceptable and people will struggle to make ends meet."
Labour MP Stephen Doughty said: "What are millions of people supposed to do until June, not least when there's a five-week wait for universal credit? How do they put food on table and pay their bills?
"This is a big announcement but with a huge sting in the tail for millions of self-employed and freelancers.
"The Government must urgently bring this scheme forward much more sooner so that livelihoods are not put at risk.
"Most people simply don't have the cash reserves in their bank accounts to get through one month, let alone three - and not least while banks have just racked up overdraft charges."
Green MSP Patrick Harvie warned that the scheme could lead to people falling "through the gaps".
He said: “Chancellor Rishi Sunak said devising a system of support was ‘incredibly difficult‘, but it needn’t have been so complicated. Fair work, robust conditions and a reliable safety net should automatically include all those who work for themselves, not just those for whom it is their main income.
"HMRC already holds data on their income from annual tax returns, so there should be no need for lengthy application processes.
“This crisis is already showing the need for speed, simplicity and universality in providing government support for people. The value of providing a Universal Basic Income to everyone is becoming ever clearer, and it would build resilience and solidarity in our society.”
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