Following the announcement of support to employers and workers as a result of the coronavirus crisis, the Chancellor has announced new measures for self-employed people.

It is anticipated payments under the Self-employed Income Support Scheme will not start until June, despite HMRC already having sufficient information on most self-employed people to determine their entitlement and make payments now.

Although a lump sum payment, covering the three-month period backdated to March, will be made once the scheme gets underway, this compares unfavourably to the payments for employees which will commence next month.

In a less-than-veiled threat of future changes to self-employed National Insurance rates, the Chancellor suggested these emergency measures pointed to the need for an equal contribution to the public revenue by both employed and self-employed once matters have improved.

Currently, there is a 3 per cent differential between the two on the first £50,000 of earnings.

Phillip Hammond famously backed down from narrowing the gap in 2017, in face of protests that it contravened the party’s manifesto. Changed days indeed.

Announcing the scheme, Mr Sunak advised that it would comprise a taxable grant of monthly amounts equal to 80 per cent of the average monthly profit made by the person over the last three years (or such shorter period as they have been in business, but see below), subject to a maximum amount of £2,500, for an initial period of three months.

The Scheme will not be open to those whose self-employed income is more than £50,000, nor to those whose self-employed income does not represent the majority of their income.

It will also only be available to those who have filed their 2019 tax return on the basis they were self-employed. To assist those who have not yet done so, they will have until four weeks from the announcement (23 April) to file their return to qualify.

As a consequence, those who became self-employed for the first time in the current tax year will not qualify.

HMRC will contact those who qualify in early June with a form to complete and return in order to access the scheme. Payment will be made directly into their bank accounts.

Further details are to be provided soon and we will update as appropriate at Burness Paull's Covid-19 hub.