Self employed- Furlough

[LockdownBlue]

Name changed as I don't want this linked to my normal profile.

In my circle of friends, there are a lot of self employed individuals. Lots of trades. Plumber, electrician plaster etc. All who have claimed the furlough grant. Claiming they have less or no work. All of which have lots of work on. Booked for weeks in advance. Not been affected past maybe the very beginning of lockdown. Though some were able to continue in this time, classed as keyworkers.

Surely this can't be right? I'm a higher earner and so is DH. Neither of us qualify for furlough. (I'm on mat leave, but wouldn't have been furloughed. None of my team at work have been either).

I don't understand how this can be right. These people have claim £4000+ and have applied for the next round of grants but haven't stopped working, in some cases, are earning more than before COVID.

It doesn't feel fair. I pay an awful lot of tax. And it's only going to go up. I understand this situation will mean tax increases. It's inevitable. Just can't get my head around people who are using this situation for financial gain. Will this catch up with them?

Even if your work was only affected by a couple of days you can/could claim the grant.
It isn’t a furlough grant
It has to be declared on your next tax return & they will be taxed on it.
I couldn’t claim because I’ve only been self employed since last April- now that is what I call unfair

It probably depends on their honesty when filing their 2020/21 tax return because if their profits are noticeably up (and they have to include the furlough grant) then there will be questions asked. Well I hope there will be, hope HMRC will have the capacity to do this.

They have to sign a disclaimer to say that there business has been adversely impacted by coronavirus.

The list of examples they give is hugely broad - it doesn't just mean a loss of turnover.

It includes things like having to self isolate, take time off sick, having to buy protective equipment, have caring responsibilities, disruptions in the supply chain, staff unable to work for all of the above reasons...

I suspect Hmrc will do cock all about it. The time cost involved in proving that on the balance of probabilities the business has not been negatively impacted will outweigh any recovery of the grant - which will be taxed anyway, so up to 49% could be clawed back. It won't be as simple as looking at the accounts either - there's lots of businesses who may have gone under due to cash flow rather than profitability as work has had to have been pushed back, but will still be completed.

You are taking about the SEISS grant, the majority of self-employed were encouraged and allowed to work during the pandemic, it wasn’t just key workers – the media threw that into the mix and caused mass confusion. The grant isnt just about financial impact, it covers lots of other reasons.

Do you feel the same way about employed furloughed workers ?

In the first month I was down 10%, the second and third 50% and 60%. The fourth was 30% and I expect this month to be about 30%.

At any point I could need to isolate and not get paid - DH is a teacher and in school 3 days a week.

They're going to get it all back in tax so I'm definitely claiming the next payment.

@userxx I understand that if you are a waitress and have been furloughed, you could go and work in a supermarket etc.

Plumber getting paid 4K grant but has more work on than normal. Not had a single day off. Seems unfair to me.

I don’t think you can apply for the second grant yet. Self employed people were told to claim and many did even though their wages didn’t go down.
I was able to claim just £300 and it went in a flash.

It’s not as much as it seems, tax will be payable on it at the next self assessment. I honestly can’t get too worked up about people claiming it tbh. You can still work and claim it you just have to declare your work has been affected which is broad and doesn’t just mean in a financial sense. For many self employed this is the difference between feeding their family or not. The alternative would be self employed people claiming benefits anyway which still costs the government a lot of money, moreso because of the increased staffing to get those benefits sorted. So I can’t really get too annoyed at the minority who are claiming when they shouldn’t. They could be investigated in the next few years and have to pay it back, so it’s at their own risk.

I applied for this, and got the full amount - £7500. At the time it did look like my earrings might seriously dip - but in the end they didn't go down that much. But I don't feel guilty - there was no way to know how things might pan out, and no way to take only a partial payment - it was all or nothing.

As for the next pay out, I'll see when details are released in August. But the government have made quite clear the self-employed are going to hammered tax-wise in the next budget to make up for all this, so I'll probably end up taking it too.

Earnings not earring!

@LockdownBlue So it is just the self employed that irks you. I do understand where you're coming from, one of my clients is a plumber and he's been raking it in, he asked if I could claim the grant on his behalf and thankfully as agents we are not allowed to it's up to the taxpayer to make the claim.

The majority of my clients have made the claim, as I have for the simple reason we have absolutely no idea what is going to happen further along. Mass redundancies are already happening, after furlough ends we will be hitting a depression head on, it's going to have a massive knock on effect so whilst people may be doing well at the moment in 3 months times they could be on their arse.

Well I received my grant. It equated to just over half my March earnings. I had no work in April or May and was down in June too. I received a paltry £180.
Not sure whether to claim next one as nearly back to normal.
Really not worth risking cheating the system.

It’s nothing to do with furlough! It’s a totally separate thing.

And it covers only a proportion of your profit. Not your turnover.

Really not worth risking cheating the system.

If you claim the second grant you're definitely not cheating the system, it sounds like your money down.

It’s not related to furlough but for the self employed grant, it will be taxed as income so they need to be providing for the tax element they will have to pay next year. Many don’t seem to have realised its taxable.

Tradespeople were not allowed to work initially. I do not know a single trades person that worked within the first 4-6 weeks of lockdown. My husband and every other tradesmen I know are still not getting as much work as usual and are having to take longer on jobs because of PPE and distancing rules (e.g where you could have a plumber and a electrician working in close proximity they now have to gonin one after the other). My husband prices per job so still gets the same amount of money whether it takes a week or a week and a half.

Why do you seem to think you know everything about how other people have been affected? Just because you and your husband are 'high earners' doesn't give you the right to decide what money the people you look down on are entitled to.

You do have to declare your business is affected. And it’s all taxable. If your accounts for 2020-21 show a huge increase in profits then I imagine hmrc will have questions. Not everyone will be investigated but it’s an open invitation for a tax audit.
I claimed and will do again in August. I’m still working but my work is down to about half time and could be for most of the autumn/winter too. Rishi Sunek has already made it clear the self employed will pay for it in the end with higher NI and tax.

Thanks userxx. I suffered as my work inceased loads in 2018/2019

S8lso op those that couldn't work had to wait 3 month for any money. The scheme is nowhere near as generous as furlough.

I didn’t claim the first payment because I was as busy as normal and didn’t seem right. But I’m anticipating getting much quieter over the summer into the autumn - so I think I’ll claim this time. It’s really difficult to predict what will happen in advance

@songbirdsings Claim it. Look at it as an insurance policy, you can always put it in a separate account and if it's not needed pay it back to HMRC. At the moment the furlough scheme is keeping things ticking over, once that ends in October is when we will see the "real" state of affairs. Stockpile any money you can lay your hands on.

Oh, and you can't claim the 2nd self employed grant yet so your claim that they've all applied for it us bullshit.

Fair point Fettfrett, I think its the 17th August the claim can be made.

I'm self employed you can't apply for the 2nd grant unless you're earning have been affected after the 15th July and even then you can only apply in August