We now await the details, but we have the outline of how this business sector will benefit. And key points to note are this: eligibility will be conditional.
 
· Firstly, this is designed to specifically target those who are reliant on self-employment, as opposed to simply being for anyone who is self-employed. Accordingly, it applies where the majority of income is from self-employment. However, it remains to be seen how this works. For example, take someone who, for a non-Covid-19 genuine reason, last reported profit from self-employment that was low, or even generated a loss. That may mean the majority of income is not from self-employment.
 
·  Secondly, a tax return for the year ended 5 April 2019 needs to have been filed. For those who have not yet filed the 2018/19 tax return, a four-week extension from Thursday 26 March is now granted. This is to ensure only those with a genuine self-employment history can participate.
 
· Thirdly, it will be available to anyone making a trading profit of up to £50,000. This has a possible twist; the 2018/19 tax year encompasses a range of trading year ends – in theory everything from 6 April 2018 to 5 April 2019. So potentially someone who last drew up accounts almost two years ago could be prejudiced by having a profit of £51,000 compared to what may have happened in the year to April 2019, or indeed now.

This Self-Employed Income Support Scheme will pay a grant of 80% of average monthly profits over the past three years, up to £2,500 per month.

So, for someone who has average annual profits of £50,000 or £4,167 per month, they will receive £2,500. This is the same as someone who has average annual profits of £37,500, so it’s not entirely clear why the £50,000 cap exists, except that the average earnings of those above £50,000 are stated to be £200,000.

The scheme will run for an initial three months. In contrast to the treatment of furloughed employees, to the extent that it remains possible (which is probably unlikely), the grant can be claimed as well as continuing to do any business.

This grant, however, comes with a few stings and a warning:
 
· Firstly, the grant will be taxable. In theory, this is designed to replace lost profits, so perhaps this stance is understandable. At least there is no deduction at source, and under normal self-assessment procedures, any tax on this is only likely to be paid in January 2021 or July 2021 at the earliest.
 
· Secondly, due to the complexity of running such a scheme, and ensuring any exposure to abuse is minimised, access to the grant is unlikely to be available prior to the beginning of June. HMRC will contact relevant individuals and will make payments directly following on from that. Nonetheless, June seems a long, long time away.
 
· Thirdly, the Chancellor made a clear suggestion that National Insurance is likely to rise for the self-employed in the future, as the inconsistencies in status between employees and the self-employed is looked at and sought to equalise.

So some good news for the self-employed but the long wait until June is worrying.

Applications can be made for Universal Credit in the meantime, with a guarantee that it should not take the usual five weeks for money to come through. The advance payment system should instead allow for funds to be paid within “days”.

 Russell Eisen is tax director at Elman Wall Travel Accountants

Will the new measures for self-employed workers affect you? Do you think they are fair? Let us know your thoughts in the comment box below.