The UK government will pay self-employed people, who have been adversely affected by the coronavirus, a taxable grant worth 80 per cent of their average monthly profits over the last three years, up to £2,500 a month.
“This scheme will be open for at least three months – and I will extend it for longer if necessary,” said Mr Sunak in a speech on Thursday.
He explained that the government is covering the same amount of income for a self-employed person as they are for furloughed employees, who also receive a grant worth 80 per cent.
“That’s unlike almost any other country and makes our scheme one of the most generous in the world.
“Providing such unprecedented support for self-employed people has been difficult to do in practice,” said Mr Sunak.
He explained that to make the scheme fair, it will be open to anyone with income up to £50,000, who makes the majority of their income from self-employment and to minimise fraud, only those who are already in self-employment, who have a tax return for 2019, will be able to apply.
“Ninety-five per cent of people who are majority self-employed will benefit from this scheme,” Mr Sunak said.
He added that HMRC are working on this urgently and expect people to be able to access the scheme no later than the beginning of June.
“If you’re eligible, HMRC will contact you directly, ask you to fill out a simple online form, then pay the grant straight into your bank account” Mr Sunak assured.
“And to make sure no one who needs it misses out on support, we have decided to allow anyone who missed the filing deadline in January, four weeks from today to submit their tax return.”
Among other measures, self-employed people can also access the business interruption loans, while self-assessment income tax payments, that were due in July, can now be deferred to the end of January next year.
“The scheme I have announced today is fair. It is targeted at those who need it the most,” Mr Sunak concluded. “Crucially, it is deliverable.”