Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will introduce additional specific measures to compensate for directors' of limited companies loss of earnings during the covid-19 outbreak.

The Government has provided substantial levels of support throughout this crisis to support people’s jobs and livelihoods, and to support businesses and public services across the UK, spending over £280 billion over the last year.

Directors who pay themselves a salary through a PAYE scheme are eligible for the Coronavirus Job Retention Scheme (CJRS). However, some directors pay themselves in large part through dividends, while taking a small salary.  Dividends are not covered by this scheme nor by the Self-Employment Income Support Scheme (SEISS).  This is because income from dividends is a return on investment in the company, rather than wages. Under HMRC’s current reporting mechanisms it is not possible to distinguish between dividends derived from an individual’s own company and dividends from other sources.

The Government continues to work closely with stakeholders to explore how it can support different groups. The Government has engaged with various proposals put forward by stakeholder groups to assess if any are viable, and it continues to review these proposals to ensure they overcome the fundamental issues of protecting taxpayer money and safeguarding against fraud and abuse from organised criminals and others who would seek to exploit these schemes.

Individuals who are not eligible for the CJRS or SEISS may be eligible for other Government support. The Government has boosted the generosity of the welfare system through a temporary £20 a week increase in the Universal Credit standard allowance and Working Tax Credit basic element. The Government has also increased the Local Housing Allowance rates for Housing Benefit and Universal Credit. Other support measures include rental support, mortgage holidays, enhanced Statutory Sick Pay and council tax support through local authorities.