Asked by: Stephen Hammond (Conservative - Wimbledon)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of allowing people who receive less than 50 per cent of their income from self-employment to claim support from the Self-Employment Income Support Scheme Grant Extension.
Answered by Jesse Norman
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. The design of the Self-Employment Income Support Scheme (SEISS), including the eligibility requirement that an individual’s trading profits must be at least equal to their non-trading income, means it is targeted at those who need it most, and who are most reliant on their self-employment income.
Those ineligible for the SEISS may still be eligible for other elements of the package of 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 fallen, their Universal Credit award will have increased to reflect their lower earnings. In addition to this they may also have access to other elements of the package, including Bounce Back loans, tax deferrals, rental support, mortgage holidays, self-isolation support payments and other business support grants.
Asked by: Stephen Hammond (Conservative - Wimbledon)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of allowing self-employed limited company directors to claim for support from the Self-Employment Income Support Scheme Grant Extension.
Answered by Jesse Norman
The practical issues that prevented the inclusion of Company Owner-Managers in the original Self-Employment Income Support Scheme (SEISS), namely not being able to verify the source of their dividend income without introducing unacceptable fraud risk, still remain.
As with the previous SEISS grants, it is not possible for HM Revenue and Customs (HMRC) to distinguish between dividends derived from an individual’s own company and dividends from other sources, and between dividends in lieu of employment income and as returns from other corporate activity.
This means, unlike the SEISS grants that use information HMRC already holds, targeting additional support would require owner-managers to make a claim and submit information that HMRC could not efficiently verify to ensure payments were made to eligible companies for eligible activity. This is about managing and securing the SEISS Grant Extension against fraud risk and misuse.
These eligibility criteria strike the right balance between ensuring support is granted to those who need it, whilst protecting value for the taxpayer.
Those ineligible for the SEISS Grant Extension may still be eligible for other elements of the unprecedented financial support available. This includes Bounce Back loans, tax deferrals, rental support, mortgage holidays, self-isolation support payments and other business support grants.
Asked by: Stephen Hammond (Conservative - Wimbledon)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of allowing people who have become self-employed since April 2019 to claim for support from the Self-Employment Income Support Scheme Grant Extension.
Answered by Jesse Norman
The practical issues that prevented us from being able to include the newly self-employed in 2019-20 in the original Self-Employment Income Support Scheme (SEISS), namely that HM Revenue and Customs (HMRC) will not have access to their self-assessment returns to be able to verify their eligibility, still remain. The latest year for which HMRC has tax returns for all self-employed individuals is 2018/19. 2019/20 returns are not due until the end of January 2021.
Unlike for employees, self-employed income is not reported monthly, but at the end of each tax year on the individual’s Income Tax Self Assessment return. This means that the most reliable and up-to-date record of self-employed income is from the 2018-19 tax returns.
The SEISS continues to be just one element of a comprehensive package of support for individuals and businesses. This package includes Bounce Back loans, tax deferrals, rental support,?increased levels of Universal Credit, mortgage holidays, and other business support grants.