Covid-19 grant for self-employed has changed...

Millions of self-employed people affected by Covid-19 may be able to benefit from the second stage of the selfemployment grant.

There are important changes to the way the grant will be calculated this time that many people won’t be aware of. So we’ve teamed up with Tommy McNally, who runs Tommy Tax App, a free app that calculates tax and claims the refund on your behalf, plus the biggest selfemployed HMRC Corona support group on Facebook with 10,000 members, to explain how it works.

■ If you’re self-employed you can claim, even if you didn’t claim last time. However, as before, you’re not eligible if you run a limited company.

■ The first grant payment was based on how your business was affected in the three months of March, April and May. This second grant is only payable if your business has been affected after July 14 – it doesn’t take account of any impact in June or early July.

■ HMRC will decide if you’re eligible and how much you’ll get. As before the grant will be calculated on your average profit in 2017-2019.

■ There is a small reduction in value in the second grant – 70% of income versus 80% for the first grant.

■ To claim you’ll need your selfassessment Unique Taxpayer Reference (UTR) and your National Insurance number. You then go onto the Government Gateway. If you don’t have a gateway ID you can create one. If you can’t go online there is a helpline: 0800 024 1222.

■ You don’t need to pay a fee to claim the grant, so don’t get tricked by scammers.

■ If you receive the grant you can continue to work and take on other employment.

■ You don’t have to repay the grant, but you will be taxed on it and pay National Insurance.

■ If you also pay yourself an income under PAYE, you should consider if you’re entitled to a tax refund. Tax is paid on the assumption that you’ll be working all year so there’s a very good chance you’ll be owed a refund this year. On average, Tommy Tax App customers are getting refunds of £3,000.

■ To make that tax refund as big as possible make sure you claim for all your expenses, particularly the extra ones such as PPE spending.