Nearly half 1,000,000 self-employed with basic credit score cuts
Almost half a million self-employed people applying for universal loans will have to cut their payments in the next month.
The government is well on its way to reintroducing the rules that align payments for self-employed universal loans with those of full-time workers for the minimum wage.
This despite the government’s promise to suspend the upper limit – or “minimum income limit” (MIF) – for self-employed universal loan applicants “for the duration” of the Covid pandemic.
> See also: In the independent face you have to pay a tax bill that is higher than what you have earned
Government officials told the Times that the MIF would be reinstated on November 13th. However, no decision has been made yet.
The Institute of Fiscal Studies has estimated that the MIF affects approximately 450,000 households who would lose an average of £ 3,200 a year if treated the same as full-time workers on the minimum wage.
Stephen Timms, Labor Chair of the Commons Welfare Committee, told the newspaper: “The suspension of the minimum income floor, the government said, should be extended for the duration of the pandemic. Reintroduction if the effects of the coronavirus worsen will be a major blow to many self-employed as they are currently struggling to keep their businesses going in extremely difficult economic conditions. “
However, the heart of the Treasury Department can be hardened by the Resolution Foundation’s investigation that found nearly the same number of self-employed – 435,000 – have received emergency government assistance for the self-employed despite not suffering any loss of income.
According to the Resolution Foundation survey, the self-employed received £ 1.3 billion in cash from the £ 12.7 billion Self Employed Support program, although there has been no real decline in income since March.
Almost 500,000 self-employed people who were still unemployed in September could not claim any claims from SEISS – either because they are newly self-employed or because they had savings that they excluded from the system.
> See also: Just when you thought it couldn’t get any worse, April business rates return
The Resolution Foundation called for the suspension of the minimum income floor to be extended to stop the punishment of the low-income self-employed and the capital rules that prevent self-employed with savings from being suspended as well.
Hannah Slaughter, an economist at the Resolution Foundation, said: “The UK’s five million self-employed have been at the center of their employment crisis. The government has provided unprecedented support in response. But it has been terribly targeted – with around £ 1.3 billion in freelancers and corporations unaffected by the crisis, while others suffering catastrophic income losses have received no support at all. “
The Job Support Scheme changes what it means for your company