SEISS complexities hold back over 415k applicants – Rishi Sunak urged to extend support
Martin Lewis provides pension advice for the self-employed
SEISS grants can be claimed for right now and a fourth set of payments will be opened up in 2021. Rishi Sunak has extended the scheme multiple times as coronavirus raged on and while this has been largely welcomed, worrying issues continue to be identified.
Recently, FreeAgent, the cloud accounting software for small businesses, freelancers and their accountants, conducted a survey of 500 UK based small business owners.
The research revealed coronavirus continues to have a huge impact on SMEs and freelancers, with 70.3 percent reporting they have been impacted negatively by the pandemic and 83.5 percent are taking measures to ensure their businesses survive this period.
Many of these changes will be painful to bear, as the following details:
- More than a quarter (27.8 percent) are reducing overheads associated with rent or office space, with a fifth relocating staff to work remotely permanently
- Almost one in five (19.5 percent) are cutting staff wages through furlough, redundancies
- Almost one in five (19.8 percent) are reducing investment in the business
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Additionally, less than 10 percent feel the support offered through SEISS, bounce back loans and other measured is adequate, with 14 percent sharing they feel badly let down by the government.
Specifically, the complexity of applying for grants and support has also been highlighted as a key barrier throughout this period, with analysis from FreeAgent suggesting approximately 415,800 SME business owners still don’t know if they’re eligible for the scheme.
When asked what would have been the biggest positive impact for them, the respondents cited the following:
- More government support in the form of grants – 20.6 percent ranked this in first place, 58 percent in second place
- Abolishing unnecessary red-tape and restrictions on small businesses – 21.4 percent ranked this in first place, 16.4 percent in second place
- More government support in the form of fewer taxes – 17.2 percent ranked this in first place, 21.8 percent in second place
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Ed Molynuex, the CEO and co-founder or FreeAgent, commented on the research: “While the Government’s support packages have helped to reduce job losses, there is still a lot more that needs to be done to mitigate the impact of the pandemic on the UK economy.
“Small businesses and the self-employed, in particular, have been severely impacted by Covid-19, but many have not been eligible for the kind of support that they desperately need or are unable to identify if they qualify for support because of the complexity of the system.
“With Covid threatening the next six months – at least – of economic recovery, many freelancers and SMEs who are already feeling the strain will now be very worried about the future – particularly as we head into the New Year still uncertain on what restrictions will look like, how long they will last, and what impact they will have on businesses.
“It’s therefore important that every small business that can come through the crisis as a sustainable enterprise is provided with the support they need to stay afloat.
“Ultimately, they will benefit the economy and the UK will reap the benefits – in post-Covid times and beyond.”
The current rules on SEISS detail people will be eligible for the third set of grants where they are a self-employed worker or are a member of a partnership.
Those who trade through a limited company or trust will not be eligible.
Additionally, claimants must have traded throughout the 2018 to 2020 tax years.
To be eligible, the claimants’ business must have been impacted by reduced demand due to coronavirus or they have been trading but are now temporarily unable to do so due to coronavirus.
On top of this, claimants must declare they intend to continue to trade in the future and they believe there will be a significant reduction in their trading profits.
Claims for the third set of grants must be made by January 29 2021.
Fourth grants are set to become available in early 2021 and the government explained they will release updates on this in due course.
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