As part of the raft of measures announced by Chancellor Rishi Sunak in response to the growing coronavirus crisis, self employed taxpayers will see their income tax self assessment payments deferred for six months, reports Pat Sweet
Payments due on the 31 July 2020 will not now be payable until the 31 January 2021.
This is an automatic offer with no applications required. No penalties or interest for late payment will be charged in the deferral period.
However, at the weekend Prime Minister Boris Johnson was forced to declare that the government ‘was standing behind’ the self employed, after claims that the government’s coronavirus rescue package did not offer the same level of support for this group as for employed workers.
Mike Cherry, national chairman of the Federation of Small Businesses (FSB), said: ‘While it was encouraging to hear the Chancellor pledge his support for the self employed today, with a commitment to defer self assessment and VAT bills and suspend the minimum income floor, this government has a long way to go to show it’s on the side of our five million-strong self employed community.
‘It cannot be right that an employee currently earning £25,000 a year could access £20,000 per annum through the new job retention scheme, while someone who’s self employed earning the same sum might only access around £5,000 worth of support.’
The Resolution Foundation has highlighted issues with self employed taxpayers seeking to access universal credit (UC) if they are now no longer able to work because of coronavirus restrictions or business shutdowns.
In an analysis, the think tank said: ‘Although the removal of the minimum income floor is welcome, this will be of little help to those self-employed people not covered by it because other income in the family or savings deny them means-tested UC.
The goal should be a more comprehensive version of the Coronavirus Jobs Retention Scheme that encompasses the self employed.’