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Jobs, Jobs, Jobs… but not if you’re self-employed

The self- employed have been left behind once again, and not for the first time, says Nimesh Shah.

It was all good news from the Chancellor, Rishi Sunak, at yesterday’s Summer Statement but the self-employed population were provided with nothing and left wondering once again as to why they have been ignored.

It is estimated that some three million self-employed workers will receive no support from the Government, because they didn’t meet the qualifying conditions for the Self Employed Income Support Scheme (SEISS), or they operated their businesses through limited companies and paid themselves with dividends.

The Government has not been particularly sympathetic towards the self-employed community. In recent years, successive Governments have made no secret of their desire to increase taxes for the self-employed, and especially those that operate through limited companies.

Yesterday, the Chancellor announced a series of measures focused on employment under the ‘PlanForJobs’ banner, followed by ‘cuts, cuts, cuts’ to Stamp Duty, Land Tax, VAT and discounted meals out, but nothing for the self-employed.

When the Job Retention Scheme (or furlough scheme) was first announced by the Government, there was no support for the self-employed. The SEISS was introduced as an afterthought a few weeks later, but it came with a warning from the Chancellor: that the ‘self-employed would need to pay through likely higher future taxes.

More concerningly, the Autumn Budget could signal bad news for the self-employed as the Chancellor looks to increase taxes, possibly through abolishing Class 4 National Insurance and aligning the lower dividend tax rates to the main rates of income tax.

The Government agenda to support employment and businesses during the COVID-19 pandemic seems at odds with the limited support given to the self-employed.

There is a perception, and mis-conception, that the self-employed pay less tax or have avoided tax, which is not the case. The fact is that the self-employed are an important part of the UK’s business community.

I find it surprising that ‘jobs’ should be differentiated in this way between the employed and self-employed.

The Chancellor has accepted that the various Government schemes cannot support every situation, and some will unintentionally lose out. However, the lack of obvious support for the self-employed seems consistent with the wider Government desire to move people into the employed arena.

Would you like to know more?

If you would like to discuss any of the above guidance or have other queries about how you can make the right decisions for the future of your business and your income, please contact Nimesh Shah or your usual Blick Rothenberg contact.

For any press queries, please contact David Barzilay whose details are to the right.