Further To

March 23, 2020 Longrider General News, General Rants, misanthropy, Political 12

My comments on the supposed help for the self employed during this crisis, there’s more…

And I’m strengthening the safety net for self-employed people too, by suspending the minimum income floor for everyone affected by the economic impacts of coronavirus.

That means every self-employed person can now access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay for employees.

This means that someone on my income who is on PAYE will get around £900 per month, whereas I can claim £94.25 per week. You and I may notice the disparity here. Are my bills smaller? Do I not also have to eat? Oh, but it’s better than that. If I employed someone, they would get the cushion of the £80%, whereas I get the £377 a month. Great.

Okay a disclosure here. I have a small pension from my late wife and my railway career. However, while this just about covers household bills, everything else comes out of earned income. Indeed, I work precisely because that pension is so small.

And to support the self-employed through the tax system, I’m announcing today that the next self-assessment payments will be deferred until January 2021.

This is worse than useless. Empty words. Firstly, in my case, I don’t owe any money in July. They owe me nearly seven grand and still haven’t paid. Secondly, they aren’t waiving it, they are merely deferring it. The self employed – if they are sensible – put money aside to cover these tax bills. We don’t just sit around waiting for the bill and then pay it out of current income. It is a planned expense and we put that money aside every time we get income, so using that income now will leave us short in January 2021 – not least because we will have the 2019/20 tax year to pay. This is not help at all. If anything, it is worse than help because we will have the double whammy to fork out next January. In what depraved mind is this considered “help”?

Now, more than any time in our recent history, we will be judged by our capacity for compassion.

Okay, fine. Having just pulled the rug from under the self employed by destroying our incomes, perhaps you can stop treating us like second class citizens and give us as much of our own money back as you are giving those on PAYE.

12 Comments

  1. “We don’t just sit around waiting for the bill and then pay it out of current income.”

    Honestly, a lot of self-employed do. Even the disciplined savers sometimes tap into that pot, as a form of overdraft.

    The rest of your points are excellent as always.

  2. I agree. I have been working for myself for the past 9 years continuously and have done so off and on since 1995. £90 plonk pounds per week when I charge £500 per day will not cut it!

  3. It’s even more complicated – many “self employed” aren’t – they operate through a personal service company. They take their money by a mixture of salary (usually very low – just enough to clock up some NI) and dividends. I can’t find out yet what the criteria are for these people (me included) because, technically, they are still working for the company even if only in an administrative capacity as a director. And, of course, the dividends don’t enter into it – note that the extension of the IR35 changes was kicked back a year – a tacit admission that it would damage the economy if ever there was one (that’s tacit admission – or maybe I did mean economy).

    For those who are actually self employed (like Mrs M) it’s a complete drop off – her work has completely ceased – but being prudent and (amongst other things) having saved for her tax she’ll get no help at all. So prudent savers get shafted (again – with the cut in interest rates)

    I actually hope Boris and his advisers are correct and what they are doing is right – if we have find out we have been misled by false predictions I think there will be a very nasty day of reckoning

    AndyM

    • I’m in a similar situation to Mrs M. I’ve got savings due to prudence and am a sole trader. However, one of my clients has some CBT work for delivery riders, so I might get some work from that.

  4. Small consolation: the 80% is capped at £2,500 pm – iirc 80% of ~£30,000 pa salary. Those on £60k receive same as £30k

    imo Gov’t being too generous. We’re in a [fake?] emergency, everyone needs to tighten their belts and do their best for Queen and

    Country

    I’m sick of this incessant complaining, whining, fear & panic mongering and negativity of BBC, C4, ITV etc
    C4 news tonight another whine fest – Gov not doing/spending/giving enough

    C4 News: Hancock pandering to negativity panic monger
    https://www.youtube.com/watch?v=h1WwvhZHMvs

    C4 News: negativity and panic, NHS will close, we’ll all die
    youtube.com/watch?v=RUJ97CuVUHY

    Finally, Gov’t has not closed your business, you can continue to train peeps and complete CBT, then a booster/refresher session when tests running again. Need money? Negotiate a delivery driver etc temp job – no reason Gov should pay anyone to sit at home when temps in demand

    • The government isn’t being remotely generous here. This situation is an act of wanton vandalism. The money is ours, not theirs.

      Events have moved faster than you can comment. CBT is no longer an option. Gatherings of more than two are now banned. This means CBT cannot go ahead as it isn’t viable. My clients have been forced to close their doors.

      As for alternative work, an email late last night means that I may well be going back to railway work for a bit. See how the that works out.

      The panic and scaremongering gets on my nerves too. But as for Queen and Country, fuck ’em frankly. I owe neither anything after this.

      • “Gatherings of more than two are now banned”

        Wrote before Boris caved to Left and shut UK – Left & Piers Morgan still not happy:
        – Media and Left now want all construction workers to be sent home

        I would say construction workers will have stronger immune systems than most

        Plod today broke up a family BBQ – that’s going to result in neighbour wars

        • As I said, events were moving more quickly than you were commenting. We had plans in place to continue CBTs. That’s a non starter now.

  5. As directors of our business, I and my colleagues have been looking into this and, inevitably, the 80% salary is not quite a straightforward as it appears—partly because the government hasn’t clarified sufficiently (and has thus introduced more risk).

    First, the payment is 80% of “all employment costs” to a maximum of £2,500 pcm—which implies (but is not clearly stated) that this sum includes any tax that employee and employer would pay. So, it’s not an equivalent of £30k pa, as one commenter asserted—but rather less. But this is somewhat unclear—so we could end up paying someone more than is allowed.

    Because, second, it is not a payment to the employee—it is a payment to the employing business. Retrospectively. At some point in the future—although who knows when (soonest is likely end of April to be reimbursed). So, if your business does not have enough cash in the bank to pay the employees, tough.

    The information says, rather amusingly, that the technology for HMRC to put money into businesses bank accounts does not yet exist—presumably, only the tech to take it… 😉

    Third, so-called “furloughed” employees cannot do any work for the business. At all. Even on the 20% that they are not being theoretically “paid” by the state. So this doesn’t help businesses, like ours, that still have to deliver project work—but where buying decisions have been delayed. We could furlough Sales and Marketing, but then we still have some contracts being worked on…

    That’s not to say that this is not more help than the self-employed have been offered. I am simply highlighting that it is, as always with the state, not quite as simple as the reporters would have you believe (mainly because most journalists are too stupid and ignorant to ask these kinds of pertinent questions).

    DK

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