Govt extends self-employed support scheme

Govt extends self-employed support scheme

The government has extended its coronavirus support scheme for the self-employed, offering a second three-month grant worth 70 per cent of average monthly profits, and has also revealed how employers will share the cost of furloughing employees from August onwards.

Chancellor Rishi Sunak today (May 29) announced a "second and final" grant for the self-employed, spanning the period from June to August and capped at a lower rate of £6,570.

He also said the government's Coronavirus Job Retention Scheme will require employers to contribute 5 per cent of gross employment costs in August, rising to 14 per cent in September and 23 per cent in October, the final month of the scheme. Companies will be able to bring workers back on a part-time basis as of July.


Later this summer eligible individuals will be able to claim the second grant under the Self-Employment Income Support Scheme, paid in a single instalment intended to cover three months.

Those who claimed an initial grant as part of the scheme, which has already paid out £6.8bn on 2.3m claims, were entitled to as much as 80 per cent of their profits for March to May, up to a maximum of £2,500 a month and £7,500 in total.

Self-employed workers will still be able to claim their first grant under the scheme until July 13. Applications for a second grant are set to open in August, but both applications will require the claimant to confirm their business has been adversely affected by the coronavirus pandemic. The same terms apply to the second grant as to the first - meaning those earning more than £50,000 a year, or directors who pay themselves largely via dividends, are not eligible.

The Treasury confirmed a claimant does not need to have claimed the first grant to receive the second.

Furloughed workers

Mr Sunak also revealed plans for the government's recently-extended furlough scheme, and confirmed businesses would be able to bring furloughed employees back on a part-time basis from the first day of July - a month earlier than originally anticipated. 

The chancellor said it would be the responsibility of individual firms to decide the hours and shift patterns worked by employees on their return, and that employers would be responsible for paying their wages while at work.  

Earlier this month Mr Sunak announced the Coronavirus Job Retention Scheme would be extended until the end of October, but added employers would soon be asked to begin sharing the responsibility of paying furloughed employee's salaries.

Today the chancellor confirmed the government's contributions under the scheme would be tapered from August, with the government set to continue paying 80 per cent of furloughed employee's salaries - and employer national insurance and pension contributions - during June and July.

From August employers will be expected to pay NI and pension contributions, whilst the government continues to cover up to 80 per cent of wages at a monthly cap of £2,500.

In September, the government will lower its contributions to cover 70 per cent of wages up to a cap of £2,190, with employers expected to make up the remaining 10 per cent.