Self-employment Income Support Scheme

(asked on 2nd November 2020) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the effect of the £50,000 cap on earnings under the Self-Employed Income Support Scheme on the financial resilience of those affected by the cap during the November 2020 covid-19 lockdown.


Answered by
Jesse Norman Portrait
Jesse Norman
This question was answered on 10th November 2020

The Government has provided, and will continue to provide, generous support to the self-employed through the Self-Employment Income Support Scheme (SEISS). The first SEISS grant supported 2.6 million individuals with claims totalling £7.8 billion. A further £5.9 billion has so far been provided by the second SEISS grant.

The design of the SEISS, including the £50,000 threshold for average trading profits, means it is targeted at those who need it the most, and who are most reliant on their self-employment income.

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: for example, those who had more than £50,000 from trading profits in 2018-19 had an average total income of more than £200,000. Around 95 per cent of those with more than half their income from self-employment in 2018-19 could be eligible for this scheme.

Those ineligible for the SEISS may still be eligible for other elements of the unprecedented financial support available. The Government has temporarily increased the Universal Credit standard allowance for 2020-21 and relaxed the Minimum Income Floor for the duration of the crisis meaning that where self-employed claimants' earnings have significantly reduced, their Universal Credit award will have increased to reflect their lower earnings. In addition to this they may also be able to access other elements of the package, including Bounce Back loans, tax deferrals, rental support, mortgage holidays, self-isolation support payments and other business support grants.

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