Financial support could be available if you are self-employed and your business has been affected by the coronavirus outbreak.
If your business can no longer operate, or if your earnings have been reduced, you may be able to claim Universal Credit.
And if you’re self-employed or a member of a partnership and have been adversely affected by coronavirus, you may also be able to use the Self-Employment Income Support Scheme (SEISS) to claim a grant.
You can make a claim for Universal Credit while you wait for a SEISS grant. When you receive the grant it may affect the amount of Universal Credit you get, but will not affect claims for earlier periods.
1. Check your eligibility
If your income from your business has been reduced, or you are no longer able to keep your business going, you may be eligible for help from Universal Credit.
Whether you can get Universal Credit depends on your circumstances, including any savings you have. Your business assets will not be taken into account when working out whether you are eligible for Universal Credit, nor when calculating how much Universal Credit you will receive.
Other eligibility criteria apply. Read more about eligibility for Universal Credit
You should apply for Universal Credit online. If you currently receive tax credits from HMRC, please be aware that if you submit a claim for Universal Credit, your tax credit award will end immediately.
3. Receive financial support
If you’re eligible, the amount you receive will depend on your circumstances, and will take into account earnings from your own business or if you are working as an employee. If you are self-employed, it’s important to report any income you have received each month, including a SEISS grant. This includes reporting if you have had no income that month.
You will usually get your first Universal Credit payment about 5 weeks after you submit your claim. If you need financial help during that period, you can ask for an upfront repayable advance. This may be up to the value of your normal monthly Universal Credit payment, and you can get this without physically attending a jobcentre.
If you receive a SEISS grant or other large payment this may affect future Universal Credit payments. Read more about surplus earnings
Self-Employment Income Support Scheme (SEISS)
1. Check your eligibility
If you’re self-employed or a member of a partnership and have been adversely affected by coronavirus, you may be able to use SEISS to claim a grant.
To claim SEISS you will need to have traded in 2018/19 and 2019/20, and intend continuing to trade in 2020/21. Other SEISS eligibility criteria apply. Use the SEISS online tool to see if you’re eligible.
Start your claim using the SEISS online tool
HMRC have now contacted those that they believe to be eligible for SEISS. If you have not been contacted by HMRC and believe you may be eligible for SEISS, you can check if you can make a SEISS claim
3. Receive financial support
This scheme will allow you to claim a taxable grant of 70% of your average monthly trading profits, capped at £6,570 altogether. SEISS grants are paid in a single instalment covering 3 months.
You’ll be able to make a claim for a second and final grant from 17 August 2020. Once you’ve submitted your claim, you will be told straight away if your grant is approved. HMRC will pay the grant into your bank account within 6 working days.
If you receive the grant you can continue to work, start a new trade or take on other employment including voluntary work, or duties as an armed forces reservist. If you’re claiming Universal Credit you will need to report any income (including SEISS grants) using your Universal Credit account.
Read more about the Self-Employment Income Support Scheme
Find out about other help you could get
If you’re self-employed and claiming Universal Credit
The amount of Universal Credit you receive will depend on your circumstances, and will take into account your earnings, whether they are from your own business, from a SEISS grant, or if you are working as an employee.
If you currently receive tax credits from HMRC, please be aware that if you submit a claim for Universal Credit, your tax credit award will end immediately. If your tax credit award ends, it cannot be re-opened and it will not be possible to make a new claim for tax credits in the future. Find out more about tax credits and claiming Universal Credit
If you are also claiming SEISS, this will be treated as earnings and so may affect your Universal Credit payment. If you are able to start working again, either full time or on limited hours, you may still be eligible to receive Universal Credit even if you are no longer eligible for SEISS. This will depend on your earnings. Find out more about how earnings affect Universal Credit payments
If you are self-employed and claiming Universal Credit, it’s important that you let DWP know about your income, so that your Universal Credit payment can be processed. This includes reporting if you have had no income at all. You will be prompted to report your income and expenses in your online account as you get close to your payment date.
Minimum Income Floor
The Minimum Income Floor assumes income at the level of the national minimum wage at the number of hours you would be expected to work based on your circumstances. This assumed level of income is then taken into account when your monthly Universal Credit payment is calculated.
To support self-employed claimants during the coronavirus outbreak, the Minimum Income Floor has been temporarily suspended. This means that during the outbreak, self-employed claimants who have a Minimum Income Floor will have their Universal Credit payments calculated based upon their reported actual earnings, and not their Minimum Income Floor.
This temporary change has been brought in to help self-employed people with the immediate impact of coronavirus, and applies to all Universal Credit claimants.
Please note that if you are gainfully self-employed none of your business assets will be taken into account when working out if you are eligible for Universal Credit, nor how much Universal Credit you receive. Business assets include things like machinery, premises and cash held in your business account.
If you are not winding-up your business you will not need to sell your business assets in order to apply for Universal Credit.
See the frequently asked questions on self-employment.