EIC0103

 

Written evidence submitted anonymously

Submission from an extremely vulnerable single parent who was working full time.

I am facing severe financial difficulties as an extremely vulnerable person and there is no help available for me.

The scheme does not work for extremely vulnerable shielding workers when the employer chooses not to use the furlough scheme. The Treasury notes state:

 

Employers are also entitled to furlough employees who are being shielded or off on long-term sick leave. It is up to employers to decide whether to furlough these employees.

 

 

As a single working parent, my income has decreased dramatically, and I am worried about my future. I have gone from earning a full time salary that is used to pay my mortgage and to feed and support my children.

 

My income is now purely from benefits. As well as dealing with the demands of shielding, we’ve had to face the problems of not having enough money coming in to live on and the inability to shop around for best value groceries as I’m limited due to problems accessing online delivery slots.

 

I am on a mortgage holiday for three months but state help with mortgages doesn’t kick in until I’ve been on sickness benefits for 39 weeks. Even then it only covers the interest and is a loan that has to be paid back, so it’s adding to my debt. I have no idea how I will pay my mortgage for the six months between the payment holiday ending and the state help starting.

 

 

It is disappointing that extremely vulnerable people are facing severe financial difficulties and cannot do anything about it as they cannot leave their homes to continue to work. I’ve paid into the tax system all of my working life, and I feel let down that I’m now struggling financially through this pandemic while others are getting 80% of their salary paid.

 

 

The scheme would work better if the Government made it mandatory that shielding workers must be furloughed to protect their incomes. If this cannot happen, a new benefit should be made available to give shielding workers enough money to live on and pay their mortgage.

 

 

April 2020

 


 

Written evidence submitted anonymously

 

 

Dear Mr Stride

 

 

I am writing to you in your role as Chair of the Treasury Select Committee looking at the the insurance industry's response to the Covid 19 crisis.

 

 

The reason is to give you evidence of how the insurance industry, in particular NFU Mutual, are viewing business interruption claims.

 

 

We rent out a property in the Peak District as holiday accommodation.

 

We thought that we were covered for loss of income via our insurance policy only to find that NFU have interpreted the appropriate clause in a way that is more restrictive than the policy wording and denied our claim.

We have asked the Financial Ombudsman to examine our claim (our letter to the Ombudsman showing the detail follows).

 

 

In know that it has been well publicised but the purpose of this note is to give you a further example and evidence of how an insurance company seems to be ascribing its own intentions to a policy clause rather than following the wording stipulated within the policy.

 

 

If I can help you in your deliberations in any other way, please do not hesitate to contact me.

 

 

Yours sincerely

 


Extract from our email to the Financial Ombudsman Sevice

 

 

"We made the above claim on our insurance, under the business interruption section, for loss of income due to the Government enforced closure of businesses relating to the Covid 19 outbreak.

We rent out a building as holiday accommodation in the Peak District.

 

 

Our claim letter included the following extract giving our reasons why we felt that we are making a valid claim :-

 

 

Policy number

We believe that our company is insured against loss of income due to the current government lock down through the Public Emergency clause in our policy.

The relevant wording that provides the cover is :-

"loss of income arising from the actions ... of a competent Public Authority, due to an emergency likely to endanger life.              which prevents or

hinders the use of or access to the premises              "

We also believe that the exclusion sentence that follows the above, "We will not pay for any loss resulting from infectious or contagious disease....", is not applicable because before the lock down and certainly now, there have not been any cases of infectious or contagious disease at the ……...

In short, the "cover" sentence has occurred, whilst the "exclusion" sentence has not.

 

 

NFU Mutual have denied our claim giving the following reason :-

 

 

WE will pay for loss of INCOME arising from the actions or advice of a competent Public Authority, due to an emergency likely to endanger life or property occurring within the vicinity of the PREMISES, which prevents or hinders the use of or access to the PREMISES for a period greater than four consecutive hours.” (their capital letters).

 

 

 

Their explanation of the policy clause which, as far as we can see, is not included in the policy was :-

 


 

 

This extension covers losses due to closure or restricted access by authorities following a specific incident or occurrence happening within the specified radius from the insured premises and is not triggered by a nationwide event or global pandemic that spans a substantial period of time.

 

We have responded asking for details of how they have derived the phrases "specified radius and substantial period of time" because we do not think that they are mentioned nor defined in our policy and suspect may have been invented to frustrate our claim.

 

We have not received a response from NFU Mutual to date.

 

I would be very grateful if you could examine our claim particularly to establish whether NFU are interpreting our policy in line with their own intentions rather than following the policy wording.

 

 

 

 

April 2020

 


 

Written evidence submitted anonymously

 

My evidence is focused on the way the chancellor and the treasury have drawn up the various schemes to assist the self-employed and people who are PAYE. It can clearly been seen that large gaps exist between the two schemes and people in very similar financial situations in terms of earnings are in fact being treated very differently. I would maintain that the treasury have made almost no attempts to address the obvious faults in the systems as they stand and that many people are falling through those cracks whilst others are actually in receipt of monies they perhaps not entitled to.

 

         I have just read the chancellors reply to your select committees communication to him about the gaps in the scheme for the self-employed. His argument about the majority of people who are self-employed and earning over the £50000 limit actually earning above

£200000.00 does not hold water, what about the people who earn just over the £50000 limit like me. I just hope that your committee does not let the matter rest at this point; basically all the chancellor has done in his reply to the committee is re stated the existing measures. The system as it stands is grossly unfair and above all the schemes have to be seen to be fair and seen to be so if we are to get through this situation as a united country ready to pay the taxes that will enable us to repay the debt burden taken on during this crises.

 

         I have actually made a freedom of information request to the treasury which is pasted below. This request was made on 23/04/20 and of course I have to wait a maximum of20 days for the information I have requested.

 

Dear Sir/ Madam.

During the Covid 19 outbreak an income assistance scheme has been set up to assist the self-employed through this very difficult period. The scheme has a maximum payment of

£2500.00 per month and to qualify the self-employed person must have a trading profit of less than £50000 in the tax year. This income threshold does not apply to those in the situation of being in PAYE scheme. It is my contention that this income threshold for the self-employed is deeply unfair and based on flawed logic. I myself have a trading profit which is consistently around the mid £50.000’s. I have already got my MP (Mr Kevin Brennan) to send a letter on my behalf about the flaws in the various schemes but I would now like to get hold of some statistics as I am in communication with various national media organisations in an attempt raise the profile of this issue. Mr Mel Stride of the Treasury Select Committee has also raised various issues in relation to the scheme for PAYE and self- employed with Mr Sunak and very recently had a written reply from Mr Sunak. In that reply Mr Sunak stated the following

 

The average income of those who earned more than £50,000 in 18/19 was more than £200,000. It is not right for the government to be giving money to individuals with higher average incomes who are more likely to have access to savings and other resources.              Mr Rishi Sunak reply to Treasury select committee 20/04/2020.

 


I would like to see the statistics that back this statement up. In addition I would like to know the number of self-employed people earn between £50,000 and £60,000. How many earn between £60,000 and £70,000 and of course how many people who are self- employed earn over £200,000. Of course I will need to know how many people who are self-employed are affected by the £50,000 an cut off (and so get no assistance) in total and what proportion of the total number of self-employed this represents. This last point is of particular interest since Mr Sunak has stated that the self-employed scheme will help over 95% of the self- employed. Please treat this email and all questions within it as a formal Freedom of Information Request.

 

I am sure you will appreciate that a timely reply is very important given the pace of events and the number of people affected by this issue and of course I wish to feed back the information to my MP and national media.

 

 

         I am self-employed and have been for many years (over 15 years). My trading profit is in the mid £50,000’s and as such I fall outside the scheme as it is presently devised because I am over the £50000 per year limit. Something I find very difficult to reconcile. How can it be right that a person who earns far more than me who is in the PAYE scheme gets assistance from the scheme for PAYE if they have been furloughed and people like me do not? Those people could earn several £100000’s a year and yet still will be in receipt of the maximum

£2500.00 per month. I have paid taxes all my working life (now aged over 55) and for most of my working life I was PAYE as well.

 

         Mr Sunak did state that the scheme would cover 95% of the self-employed is that really correct?

 

         I am a genuinely self-employed person with around 900/ 1000 customers a year as most of my jobs are very small jobs paying small amounts so am not a contractor trying to avoid tax and working for just one employer (though of course this is perfectly legitimate from a tax point of view as far as I understand).

 

         I have always felt that opting to go into a limited company structure as a way of reducing my tax liability would be immoral so I have never gone down that road. It is my understanding that if I had done so I would now be able to claim 80% of the PAYE payment I had paid myself but not the dividends. So people who took steps to reduce their tax liability are better off than me under the scheme and probably earned more from their self-employment as well! Again of course I recognise this is a perfectly legitimate tax practice though not one for me on moral grounds.

 

         I have always declared all my income and of course not all self-employed people do that in an effort to avoid tax. So I find myself in a situation where I am being penalised for my honesty. How can that be right? I personally have become recently aware of people who have under declared revenue and so are now eligible to receive the payment

 

         The situation with corona virus has badly affected my business. I have virtually no work and cannot see it getting back to normal for many months. In fact I expect it to last until the end of this year at least with my business. My occupation involves going into people’s houses and of course people are worried about that and I think it will take a long time for people to

 


regain confidence. I have large amounts of work booked in but now those people will not let me do the work.

 

         I notice that with the PAYE scheme it has been decided that people who have been furloughed and are going to receive payments can also work for another company whilst being paid by the tax payer. How can that be right, we are in a situation where the number of people going onto universal credit is going up massively yet they are potentially missing out on such employment opportunities? With such large numbers on universal credit it must be possible to find the people with the skills to fill any employment vacancies without using people who are already getting a payment from the tax payer. Only a few days ago I came across a person who is now working for a supermarket on the checkout whilst being furloughed from a fairly senior role, you can imagine how I felt.

 

         I understand also that it is possible to be furloughed from two jobs and receive 80% of your salary up to a maximum of £5000.00 per month. How can that be right when a people in my position receive absolutely nothing? Clearly the people receiving the maximum of £5000.00 a month must be on a significantly higher salary than I would ever get from my self- employment. When I consider this I also think about those poor people who just happened to change jobs at the wrong time and now receive no support whatsoever. I understand that around 200,000 people per month change jobs. I know that they have recently altered the cut-off date for the PAYE scheme but as far as I am aware this will not help most people in this group as they are paid monthly and HMRC would still not have a PAYE record for them by the cut-off date. When they altered the date the treasury must have been aware that it would have minimal affect. I saw a poor man on channel 4 news after the cut-off date was changed with a family to support. The man was close to tears on national television and of course the scheme for PAYE will still not help him. He pleaded with the chancellor to do the right thing, a sentiment I fully agree with.

 

         Of course since I am self-employed I have to make my own pension arrangements and so am fully invested through a SIPP in the stock market and you can imagine what affect the recent events have had on the value of my pension. So In addition I find myself having to pay tax to support workers in the state sector (plus MPs on a 40th Final Salary Scheme topped up by the tax payer from time to time) who are in pension schemes linked to their salary who face no such risk. And we all know that the members of such schemes contribute into them nothing like the true value of these schemes benefits. What’s worse when they retire the benefits are multiplied by 20 when being assessed against the life time limit for tax purposes when most actuaries agree it should be multiplied by 40.  Again this just illustrates how unfairly the self-employed are being treated. For me to achieve anything like the pension of a person employed in the state sector most actuaries agree I would have to have a fund twice the size of the assessed value of the state sector person and I would be taxed accordingly should I breach the £1million limit.

 

         When the scheme for the self-employed was announced a threat was made re the level of tax/ NI the self-employed pay. Such threats take no account of the fact that we have to provide for the full cost of our own pensions, holiday pay and sick pay. Any move to make us pay the employers contribution for NI would be deeply unfair after all a PAYE employee does not pay that, the employer does.

 

         An article was published in the Financial Times on the weekend (18/04/20) which discussed a quirk in the coivid 19 assistance for small businesses whereby a tax free grant of £10,000 was available to owners of second homes in areas like Cornwall who had changed the status

 


of their second home to avoid paying council tax. Again I cannot see how that is right. Apparently these people do not even have to prove that the property has been let they just have to say that it is available to let for at least 140 days per year and have a turnover of less than £15000 per year. So people who used a device to avoid council tax are now going to get a £10000 grant as well. I am sure you can guess how the councils feel about that.

Apparently Mr Sunak wrote a report in a previous government role condemning such practices yet now he proposes to give them this money.

 

         Also in the financial times (18/04/20) it was an article about members of the House of Lords who apparently are deeply unhappy that they may not get their attendance allowance (£327.00 per day I think) because they are in isolation/ may meet virtually. Apparently certain members are demanding payment even though they will not be attending. This payment is not taxable and I think amounts to a tax free sum of £48000 per year. If a country is to pull through this crisis then we really do have to ALL BE IN THIS TOGETHER as Matt Hancock etc. keeps saying. For that to be the case the schemes have to be correctly and run on moral lines. After all when we get through this we are all going to have to pay the taxes necessary to get the country back on a sound financial footing.

 

         In the end people like me have little political power and we may just have to accept the situation. Mel Stride of the Treasury Select Committee has stated that Mr Sunak should remember that the savings of the self-employed are their pensions and of course he is right, we have nothing else to fall back on.

 

 

April 2020

 


 

 

 

 

 

Written evidence submitted anonymously

 

We are a local haulier who has an operating centre at […]. We applied to Mid Devon District Council for our Business grant as we are in receipt of Small Business Rate relief. We have been refused the business grant by MDDC as they say they don’t pay out on parking places. This is much more than that, it is our operating centre for 10 H G V vehicles, for which we required both planning permission, and approval from Western Traffic Area. The website states that personal parking is not included for the grant, but this is in no way personal parking. We fulfil the requirements, so should receive the grant. We have had to park up seven of our HGV vehicles for the last six weeks, which has had a dramatic effect on our business. There are still standing costs involved on the lorries, regardless of the fact they are parked up, and we need support which we are not getting.

 

We would be grateful for any help you can give in aiding us to obtain this grant.

 

April 2020

 


Written evidence submitted anonymously

 

 

We are a small self -employed business partnership. We find this unfair for the following reasons.

Job protection scheme and self -employment income - support scheme

 

There may be two earners of £49,000 in the same household and both are entitled to getting government help up to £2500 each per month: ie: up to £5,000 per month for both. I am the main earner in our family. My husband doesn’t work. My business partner is the only earner in her family too.

Therefore, if nothing else our tax bill should be CANCELLED not delayed until January. By then we won’t have anything left as we won’t have earned anything to pay our tax bill.

 

We feel everyone who has a small self- employed business should be entitled to something.

 

 

 

Which sectors are likely to be impacted by economic scarring:

 

Our business deals directly with actors is likely to be scarred for longer than most, it’s impossible to make movies, tv drama, theatre and commercials (we are all sick of zoom versions) for the foreseeable future. It’s impossible to social distance when acting out a script therefore there are no productions (or very limited) being made in the UK.

 

Our business is therefore dead after 25 years. Our earning power has been cut to 0. By June if the acting profession isn’t back up and running, we are all going to need help within our industry. This still hasn’t been addressed at all by the government at this time.

 

BREXIT: A main issue for the acting business as well. We send loads of British based actors abroad to work all over Europe for TV Commercial projects. Again, how is this going to continue when nothing is agreed for this industry with the EU. Therefore, our business can’t survive after Brexit. DOUBLE WHAMMY.

 

Thank you

 

April 2020

 


 

Written evidence submitted anonymously

I am writing today to various individuals in both local & national government. I have been seeking answers into an anomaly in the thresholds for business rate support grants for over 3 weeks now. To this date my questions remain unanswered.

 

I have specific questions as a concerned business owner seeking clarity on the promises made to me by the Chancellor and the Treasury since the government asked the public to stop visiting my business and the ordered closure of my Public House. During various public speeches and on official documents released since, we were promised a cash grant of £25,000 to protect our business during these tough times.

 

As a result of the support being promised by the government together with the coined phrase of 'getting through this together', we closed our business and co-operated with the governments plea to 'stand by its workers', not only in agreeing to furlough them, but also ensuring that they suffered no financial hardship at all by ensuring they continue to receive 100 percent of their regular wages during these unprecedented times. We also paid all of our overheads to keep the cash moving to other businesses under the belief the government would stand by its promise that we "wouldn't be alone".

 

 

Our business has a rateable value of £15,000 (rounded down). Under the long standing 'small business rate relief' scheme we have never been able to benefit, as we have missed the relief by a narrow margin. Below is a series of facts that led us to believe we would receive a grant of £25,000.

 

Documented Evidence

 

 

 

 


 

 

 

 

 

 

The department of Business, Energy and Industrial Strategy (BEIS) will provide guidance for local authorities on how to administer these grants shortly”

 

 

“Under the Small Business Grant Fund all businesses in receipt of Small Business Rate Relief or Rural Rate Relief in the business rates system will be eligible for a payment of £10,000”

 

Again this falls in line with the Chancellors promise that those in receipt of SBBR or RRR would receive £10,000 whilst those like us who were going to benefit from the extended retail discount scheme would get a grant for

£25,000.

 


 

In Summary

 

The Chancellor of the Exchequer made it clear that any business who had received either Small Business or Rural Rate Relief would get a grant for £10,000 and those who were benefiting from the extended retail discount as of 11th March 2020 would get a grant for £25,000.

 

The publication of the Covid 19 – Business Support document on the Government website together with the Treasury document on Business Grant Funding, both of which confirmed beyond any doubt that businesses with a rateable value of £14,999-

£51,000 would get a grant for £25,000 was a statement which backed up the Chancellors promises.

 

It was stated very clearly that the Department of Business, Energy & Industrial Strategy (BEIS) would issue guidance for the local authorities to follow based on the information already available. It was never stated that this department would change the thresholds and withdraw the promises of the Chancellor & the Treasury. The new guidance changed the figure of £14,999 to £15,000 and in doing so placed many businesses like mine into the same category of those previously receiving rate reliefs, which I have not been fortunate to ever receive.

 

When I contacted the Governments Business Support Helpline to discuss my situation they assured me that as my business has a rateable value of £15,000 I would receive a grant of £25,000, when I explained that I had received only £10,000 they assured me that contradicted their information.  When I explained how the thresholds had changed in one document, they were at a complete loss as to how or why this had happened.

 

I can only hope that the moving of the thresholds and the resulting reneging of the promises made by HM Treasury is an oversight and was done without intention. Nobody is yet able to clarify this or attempt to address how it has happened.

 

Summarised Questions

 

 


knowingly place unfair financial strain on approximately 3,700 small businesses who have had to stop trading on Government advice?

 

April 2020

 


 

Written evidence submitted anonymously

 

Please accept this letter as a formal request to amend the current business rate relief criteria and ensure that businesses that are closed and genuinely suffering from the Covid-19 hysteria are provided 12 months relief.              Specifically including the Print Sector & Exhibition Sector.

 

1.   Situation

[…] is my business and has been running profitably for the past 23 years and consequently paid around £10,500 per annum in business rates to the local Broadland Council.

 

Due to the Covid-19 situation I have had to furlough all 9 staff and close the business.              70 – 80% of our clients are operational in the exhibition and event sector.              A sector that I now gone for the next

18 months due to the continuation of social distancing.

 

2.   Problem

I have seen Rishi Sunak in the House of Commons confirm that the exhibition sector will be included provided those companies have a physical property, they will benefit from rate relief and the grants.

 

We are now seeing some councils start to pay these companies.

 

[…] is classified as a printing company, so there is the issue with the SIC code, however, we still service this industry significantly.

 

One point to consider is that the injustice on this situation is the supermarkets that are doing some £500 Million a week better in sales along with the DIY stores, these companies are benefiting from 100% business rate relief.              Meaning their profits will have sored next year, all the while cost the UK economy over £3 Billion in lost collections.              Can you confirm who is going to cover that?              Are we as businesses going to be told that we need to pay more for our rates because last year was not particularly good?

 

3.   Implications

The implications of this to me and my business mean that when I return to work with a team of 8, probably 4 – 5 of which will be made redundant I am effectively having to start again from zero to build the business up.              All the while this means I will have increase fixed overheads in the deferral’s on payments I have received during this time.

 

The absolute worst-case scenario is that I will have to close the business, sell off the assets and make all the staff redundant.

 

I know the banks are looking at CBILS loans, however, these are purely loans and need to be repaid with interest.              So, I’m effectively being asked to borrow money in order to continue paying my business rates and other associated costs which will have gone up and my income gone down in the hope that at some point next year

 


business returns to normal, however, there is no guarantee things will return to normal within that time frame.

 

4.   Solution

The only solution to this problem, is that all businesses that have been forced to close and furlough all staff they too should benefit from 100% business rate relief for 12 months also, along with the grant of £10,000.

 

Implemented with immediate effect, allowing the print sector to be included due to their close relationship with the exhibition sector.

 

5.   Approval

Please can you respond to this letter with confirmation of either approval or disapproval by confirmation below.

 

Approve / Disapprove

 

 

I hope you find the above interesting and look forward to your response on this important matter.

 

May 2020

 


 

Written evidence submitted anonymously

 

I would like to focus on the SEISS. In particular the arbitrary £50k cliff edge cap.

I am a sole trader mortgage & insurance broker who has seen significant impact to my sector, and my personal trade, owing to the Covid 19 crisis. I am submitting evidence as I am outside the scope of any taxable grant assistance whatsoever and with no prospect to date of society functioning fully anytime soon. I believe it only correct that the gaps in the scheme are filled.

It’s now almost impossible to trade new mortgage business for a house purchase. No viewings, lenders pulling higher LTV rates, no level two lender surveys as examples of the current position. What is equally if not so more concerning is that this sector of trade will only truly operate if all factors can operate together, starting with the vendor showing a prospective buyer around, then to allow a surveyor into their home etc

So anyone on mandatory 12 week shielding this is not an option for circa another six weeks minimum.

The interim measures such as virtual viewings (where applicable) desktop surveys etc are in reality from my experience are not working. Would you buy a house if you couldn’t see it?

Many buyers are holding back, understandably, until the process can be followed with pre covid procedures and full market options.

The slump in new business house sales, new mortgage business, posted nationally also confirm this. Insurance applications are also very difficult. I am experiencing insurers withdrawing from offering an application process when a GP report is required as consideration understandably is given for GP’s to deal with Covid 19 customers. GP practices are also rejecting pipeline applications for information submitted pre lockdown ‘until further notice’

So the Government’s notion that self employed sectors can continue to trade very much depends upon what trade can be obtained, at at what level. New business in the group outlined for me, mortgages attributed to new house sales to date, is down totally, 100%. There is a little bit of trade potentially available but since March it’s being significantly restricted and reduced as expected.

Finally there is currently a battle to hold onto (and not always successful) ‘pipeline’ income built up prior to the lockdown. With people withdrawing from transactions So it’s a ‘triple’ hit, pipeline income lost, current income lost, and future income lost.

 

I am submitting evidence as I believe that the SEISS scheme has significant shortfalls which whilst publically noted by key figures of society , appear to be simply ignored to date. I belong to the excluded Self Employed sector and understandably I am concerned about this, taking into account the above and the near term unknown future. I believe this sector overall to be way in excess of 5%.

 

Problems Claiming

The Arbitrary £50,000 Cap. There is your answer right there. You cannot claim if you are a penny over. It is a cliff edge. From self-employed Income if it is deemed that you have earned a penny too much, even from up to four years ago. You deserve no help. We are tagged by the chancellor as ‘super rich’ and bracketed into a £200,000 earnings bracket. This, from my own personal position is simply incorrect. I fall £115 outside the scope of any help.

£115 one way and I am tagged as vulnerable £115 the other way and I am tagged as ‘super rich’

In a national crisis this is just incredulous. Especially as it is compared to the unlimited PAYE scheme currently paying to some employees earning significantly more with an unlimited cap threshold.

There are thresholds which are far more relevant such as the 45% tax rate, VAT rate, and even the upper child benefit rate.

A cliff edge is an unjust and unfair system (particularly bracketing everyone into the £200k bracket) it’s not unreasonable to suggest a taper would be far better and target as I feel as intended.

 


Just a suggestion.

50,000.01 to 100,000 – a reduction of 1% for each £1,000

£100,000.01 – 50% reduction.

It’s still a compromise to the unlimited PAYE scheme.

You could even impose a harsher taper, should you feel it necessary, to a cap more in keeping with the targeted market.

When the chancellor announced the SEISS he did so with the strapline ‘if we all want to benefit, we all have to pay back equally’

I have no objection to raised taxes, NI, VAT etc it is expected. But how galling is it to hear this when you are excluded. How can we all benefit (with taxable grant help) if you are told you don’t qualify?

 

This taper could be rolled out as a ‘phase two’ scheme. Anyone a penny over the £50k cap I am sure would be happy to wait for taxable grant assistance, or even an option to reduce the 31 July 2020 tax bill by the equivalent grant amount as currently they are offered none. No help at all.

Deferring a tax bill is of no assistance at all. It still needs to be paid, whether in July 2020 or Jan 2021, it still needs to be paid. A reduction option to this would be a significant assistance to many, alongside the other option of a taxable grant paid.

 

Has the Government struck the right balance between targeting support Certainly not.

The SEISS scheme, appertaining to the £50k cap I believe has two entry qualification criteria

 

2018/2019 Rule

£50,000 or under – instantly qualify

 

Averaging Rule, 2016/2017, 2017/2018 & 2018/2019

£50,001 – 2018/2019

£47,000 – 2017/2018

£54,000 – 2016/2017

Average - £50,333 – Not qualifying

 

Averaging Rule, 2016/2017, 2017/2018 & 2018/2019

£50,000– 2018/2019 – Instantly qualifies, no averaging required. However for the sake of comparison

£76,000 – 2017/2018

£69,000 – 2016/2017

Average - £65,000 – Qualifying

 

I would deem the second person to have the better financial resources. However as they earned £1 less in 2018/2019 they are deemed the financially vulnerable, even though their average is just under £15,000 PA higher than the excluded person?

A fair taper for the excluded would eradicate this injustice within the SEISS. Loans replacing Grants as income

This is not an option.

Whatever the chancellor would like to call them, bounceback or otherwise taking out a loan, increasing debt when we don’t know when society will be functioning properly again, when we can trade properly again, is not a sensible option.

 


 

 

No Business Premises

Many Self Employed over the cap do not have business premises, so are not entitled to business rates grant relief either. They also have no PAYE portion of their income to furlough. It truly is the one fully excluded sector.

 

Universal Credit

Call me old fashioned but I was always taught to save for what you need and only spend what you need. So by saving for a new vehicle (mine is 19 years old) that I was due to replace next year, and for my pension it is deemed that it is best that I use my savings so deserve no help here.

Please don’t say universal credit is a viable option to replace the taxable grant for someone a penny over the cliff edge. However if I had spent all my savings on a new car and maybe fancy holidays I would at least be able to claim circa £400 pcm. This is incorrect. A tapered grant would remove this. It’s also dangerous to remove any funding you may need for new stock, machinery etc.

 

How Successful has the Government been in plugging the gaps? Completely unsuccessful. This is almost as disappointing as the cap itself.

Significant figures of society have raised the issues of the SE £50K cap, such as Sir Edward Davy MP, Sadik Khan and significant bodies such as the BDA. Yet all we have had is complete radio silence on the matter. It looks like they have just being completely ignored.

If the Governement have no intentions of looking at the SEISS again, then the min they can do is tell us. It’s no point filling in forms like this if they are irrelevant. We do not expect instant change (however the PAYE scheme was changed relatively quickly from a 28/02 to a 19/03 date) but we do need to know if they have no intentions of considering change. I did believe that the chancellor ‘would do whatever it takes’ as he stated. If not, at least have the decency to tell us now.

This may make the difference for an excluded sole trader to decide whether to close up shop now or continue to use personal savings in the hope that some resolution or middle ground can be found.

 

What gaps in coverage still remain

The arbitrary cliff edge cap. No taxable grant assistance above this at all.

Ltd Co Directors No consideration taken for dividend payments in respect of taxable grants First Year traders. No consideration taken in respect of taxable grant options.

 

How Viable is it for SEISS to open for longer?

The treasury will have the financial figures for this.

However what I can tell you from public experience is that we are seeing (permitted) business reopening again now before any lockdown phase two. Garages, pet stores etc, local businesses who through potential exclusion have little choice, previously closed.

A business still has overheads, Insurances etc all to pay for. As well as your personal living costs. Whether you have business premises or not outgoings continue.

You cannot expect these to live off fresh air or savings or to supplement lost income with savings for potentially the rest of 2020.

This is why traffic is increasing.

The push to open up society again from my own experience is largely coming from business owners and small traders excluded. This could be a disaster if we open up society incorrectly.

 

Thank you for taking the time to consider each of the above points raised which I hope you find fair, rational and considered.

 

May 2020

 


 

Written evidence submitted anonymously

 

I write in connection with the Self Employed Income Support Scheme announced by the Chancellor in March.

My wife and I are not eligible for this grant and I would like to explain why this is so unfair to us and apparently 250,000 others.

I have been self-employed for 37 years, always paid my taxes, national insurance and VAT on time. I have always submitted my tax returns on time.

Due to coronavirus all work was cancelled and therefore my wife and I have zero income.

During 2016/17, 2017/18 and 2018/19, the 3 years used for the calculation of the grant, I invested in my business and therefore made tax losses. Because of this, using the averaging my grant is £0.

In 2019/20, mainly as a result of my investment, I made a profit, but this is unfairly not taken into account for the grant. In fact, my 2019/20 year, is based on my financial year 7.5.18 – 7.5.19 as the self-employed pay tax on the ‘previous year basis’ i.e. the financial year ending in the tax year. I have also made profits this year to 7.5.20 so in actual fact I have been making profits for 2 years, but none of this is taken into account for the grant. The ‘previous year basis’ is not my choice, but the governments. Obviously those who are employed and taxed on an April to April basis would not have this problem. I am hoping the Chancellor did not have this in mind when he designed the scheme and can be convinced to change his mind.

The Chancellor announced that to include 2019/20 would lead to fraud, but I am honest and hardworking and always declared every penny. This announcement suggests everyone will be fraudulent and obviously the vast majority of honest people are penalised. The priority should be to help all self-employed people during this pandemic, as he has suggested, but for some reason this is not the case.

The Chancellor also said he could not include 2019/20 as the deadline for the return is 31.1.21. I do not understand why this is a problem as returns can now be submitted from 6.4.20.

Ironically, the Chancellor extended the deadline to file tax returns for 2018/19 from 31.1.20 to

23.4.20 to give those self-employed who didn’t return on time to file a tax return and potentially lead to fraud that obviously we all want to avoid.

I know the exclusion of 2019/20 has affected many thousands of self-employed, especially the newly self-employed whose first tax return is 2019/20.

The Chancellor has admitted that he has not helped 5% of self-employed, some 250,000 tax payers who receive no grant at all. Why should we be different? As the Chancellor says, ‘we are all in this together’ but he refuses to support everyone together.

Also, as regards the Chancellors rule that self-employment income must be more than 50%, my wife is self-employed but also has a part time job. In 2018/19 the part time job was £200 more than the self-employed profits so again the grant she gets is £0. I don’t understand why the Chancellor should have this rule and again is totally unfair. My wife took the part time job to supplement the self- employed income but she is being penalised for this Why?? She is not entitled to be furloughed for the part time job.

 


I simply ask for 2019/20 to be included in the calculation of the grant with suitable proof of income / documentation and the 50% rule removed. We have no income, no savings and only have working tax credit. We are not entitled to any other help as we have service businesses working from home. Without help from this scheme we will have to go into debt and severe financial poverty.

Why are we being left out?

May 2020

 


 

 

Written evidence submitted anonymously

 

A Case History of a Wycombe Town Centre Restaurant and Its Insurance Company

 

A few years ago, Wycombe District Council actively invited local café owners in High Wycombe to open a restaurant […] in the town centre in order to help bolster the High Street offering and be local champions of the independent food sector. As a new restaurant business it opened with community support, raising £17,000 through crowd funding. It had no bank loans or overdraft facilities, nor even a credit card (as the banks would not invest in the company until it could prove trading). It is now VAT registered and has high ratings on social media.

This fantastic initial success made the restaurateurs proud they had contributed to the regeneration of the town centre.

 

The restaurant owner is impressed by the Government’s businesses aid package, particularly the rate payers grant and furlough scheme. This means he has been able to pay staff, in full and on time, and also pay suppliers so they too can remain trading, or open again once the country is back to some kind of normality. In essence, he’s been able to limit the financial impact of the pandemic slightly because of some of the provisions put in place by the Government.

Unfortunately, although the support has been fantastic in the short-term, it’s unlikely to be enough to allow […] to survive.

 

There is a serious issue with the restaurant’s insurers. The owner appreciates these are unprecedented times for insurers. However, he thinks this should not mean insurers can unfairly seek loopholes to the detriment of swathes of small businesses when the black and white of an insurance policy should provide some safety net. He is of no doubt there are many small businesses that are in the same situation and need a larger voice to speak for them too, either to bolster the insurance claims, or have the Government help the insurers to help business. The reality is business interruption insurance is the last bastion of hope for many small-scale enterprises. It exists because when companies are forced to cease trading, they do not have the reserves of other larger corporations. And, without it, they will simply not survive.

Below is an outline of the restauranteur’s dealings with the insurance company: The restaurant’s policy as it pertains to Business Interruption, specifically:

2. Closure – of the premises by a competent authority due to: a) an outbreak of any notifiable

human infectious or contagious disease at the premises;

 

The wording of the policy was enough to leave the initial policy handler surprised, as most policies categorically do not cover pandemics. However, the restauranteur knew there was a process to go through to establish exactly how the claim would be handled.

 

On waiting patiently for over four weeks to speak to a loss adjuster he then spoke to one on Friday, 24th April. He had a conversation about […]’s

-Annual turnover

-Costs

-When and why the restaurant closed

-How the business has been affected and what the restaurant was doing currently.

 

After all this the restauranteur was told the business was not covered because the wording includes ‘at the premises’.

 


The restauranteur takes issue with this as the restaurant has been ‘closed by a competent authority’ of the highest level: the Government. It is closed because of ‘an outbreak of any notifiable human infectious or contagious diseases’, and the WHO‘s March 11th declaration that Covid-19 is a pandemic, defined as being ‘prevalent over a whole country or the

world’ would by extension quite reasonably include a restaurant that has been forced to close because of its very existence.

 

The restauranteur believes the business is covered quite clearly by its insurance in this instance. The policy does not contain any exceptions such as ‘does not cover pandemics’ as others do.

 

The insurer has argued the restaurant is not covered due to the phrase ‘at the premises’. The owner cannot find anyone who does not think this is an unfair exploitation of ambiguity, in a way that is neither morally nor legally justifiable. He also feels that by asking so many questions and assessing the business state before letting him know he was not covered demonstrates the insurers could have come down on either side of the line, dependent upon the severity of the claim.

 

The latest development in this story is that the insurers are trying to say Covid-19 is a ‘pollution’ and is therefore excluded.

 

We would also highlight that the policy is subject to a General Exclusion for Pollution which is a defined term in the policy as follows:-

 

“Pollution, Contamination, Sooting, Deposition, Impairment with Dust, Chemical Precipitation, Poisoning, Epidemic and Disease (including but not limited to foot and mouth disease), Adulteration, Impurification or Limitation or Prevention of the Use of Objects Posing Hazards to Health”.

 

The presence of COVID-19 may be considered contamination and is a naturally occurring organism.

 

The restauranteur’s expectation is that if he manages to get the insurers to agree Covid-19 is ‘at’ the premises which it is currently using as the reason not to honour the business interruption payment, it will then change the argument to say the business is not covered under the definition of what Covid-19 is.

 

May 2020

 


 

Written evidence submitted anonymously

I am a ltd company where i am the sole employee and i work in the TV commercials sector.

 

I am sure you have been inundated with emails about this so ill keep it brief.

 

No TV commercials are likely to be made for a while even when most people are back at work because generally i work with crews of 50+ on a shoot day. I can’t believe the government will allow this to happen any time soon.

 

I haven't been offered any grants to help me whatsoever, i’ve been forgotten, like many others it would seem. I have had to furlough myself and that amount covers less than half my mortgage (£1045) a month. I take most of my money in dividends which of course i am now not earning. Why haven’t i been given any help whatsoever? I pay cooperation tax, normal full time employees don’t. So you

don't consider dividends to be part of my income? Therefore, moving forward, surely then i should no longer declare or pay tax on any dividends I draw. I should just reclaim all dividend tax I have previously paid, by deducting it from my future corporation tax bills,.

 

Also it makes no sense that the Job Retention Scheme places no cap on full-time employee salaries yet the self-employed are capped at £50K to be entitled to support. So my partner also falls through the cracks.

 

No doubt you will now hike up tax in order to cover the costs of giving out all of these grants but neither myself or my partner have received them but will no doubt have to pay the increase in taxes. It’s so unfair and totally not on.

 

This is just the tip of the ice burg.

 

May 2020

 


 

EIC0163

 

Written evidence submitted anonymously

 

I would be very grateful if you would please look into this matter on my behalf?

 

I am a self-employed musician: This is my only Source of income

 

Submitted self-assessment profit for previous 3 years.

Profit from self-employment 2016/17 = £1.145 Profit from self-employment 2017/18 = £5.948 Profit from self-employment 2018 /19 = £7.338

Total profit from self-employment for the last three submitted years £14.431 Average profit from self-employment for the last three submitted years £4.810.33

80% of average profit from self-employment for the last three submitted years £3.848.26 Divided by 12 = Monthly grant from Government £320.68 X 3 = £962.06


 

The first year 2016/17 of self-employment I was 17 and still in full time education, so had very little opportunity for earnings.

The second year 2017/18 was spent partially in full time education, so limited opportunity for earnings.

 

I therefore feel that it would be unfair and inaccurate for the Government to calculate my 80% grant, based on the average of my submitted last three years profit as a self-employed person. Since the governments forced lockdown, there are no longer any opportunities for me to earn money.

 

May 2020

 


 

Written evidence submitted anonymously

 

I’m writing to you to ask for help as simple as that.

 

I’m self-employed since August 2019 and at the moment neither myself nor my partner ,who is self-employed too, can get any help. We are both out of work since our industries have closed down at the moment. We live in London with our daughter who is 4 years old and our household is getting not help whatsoever. I had been employed for over 20 years and change to self-employed last year and now I find myself without any help which as you can imagine it’s extremely worrying since nobody really knows how long this is going to stay like this and how we will get out of this situation. I could submit a tax review for 2019-2020 but you are not considering that year and by doing so not allowing me to get any help. My partner can’t get any help because you are also basing it not on the actual last year but 2018- 2019 and he cannot get any help. All we want is some help to allow us to survive this situation which as you know is awful for all. If it’s not the illness that kills you, it could be your finances. Please help more people!

 

I’m asking you to re-look at your plan for the self-employed, if you live in London you have London living wages so perhaps you could look at removing the cap on 50K and also why not help everyone at a time like this and include all self-employed even if they only have been in the last 3 months. Again, without this, a whole group of people will be arbitrarily left out altogether.

 

You can only help us at this time so please consider wisely and take your time as I appreciate it’s a complicated system.

 

May 2020

 


 

Written evidence submitted anonymously

 

Small Limited Companies Need Recognition from Government and to be treated fairly and equally and not discriminated against

 

I am 70 years old and own a Public House in […], Oxfordshire . I have worked in the leisure and hospitality sector my entire life, owning my own businesses for over 50 years, during this time I have always employed people, paid VAT, Taxes, Capital Gains tax when I have sold businesses. I have been a Conservative voter and supporter for 50 years, believing this party understand the importance of small businesses and a broad based economy.  Life many people in small businesses I have everything tied up in my business, my life savings, home, livelihood, everything. Many of you may wonder why I am still working at 70, unfortunately my pension was in Equitable Life which as you will be aware collapsed, however I thoroughly enjoy working and work every single day of the week, I average between 50-60 hours work a week 7 days a week.

 

Small rural Public Houses are the hub of our communities, we play a huge part in the social life, health and mental well-being of our communities. We act as job exchange centres, meeting places, support networks and a place of coming together to celebrate national achievements and disappointments. Public Houses have been part of Great British Heritage for hundreds of years and without further support and intervention by Government thousands will close and never reopen for future generations.

 

The Pub and hospitality industry in general have been left in a perilous state. The Government's support package so far has been very welcomed but totally inadequate for our industry as our insurers will not cover for Business Interruption or the losses for perishable stock. as a small rural Public House we have lost £70,000 so far in lost turnover so far and

£9,000 in perishable stock. The majority of us face financial ruin without further sustained support. Loans are not the answer for everyone as many of us do not know how long it will take to rebuild our business as the public have been scared to the extreme not to come out and not to socialise.  For people that have always been paid a salary as as most Ministers and MP's are still receiving full payment , it's possibly hard for you to understand what it must be like to have no income and everything you have invested in, simply decaying, devaluing and disappearing before your eyes. but many of us in Public Houses, face to loose everything and I mean EVERYTHING

 

We personally risk to loose everything our home, business, livelihoods, everything I have worked for for the last 50 years. Not a great prospect at 70 . I have always been a Conservative voter and supporter and believed you understood small businesses.

 

Our industry rural Public Houses has undergone a huge decline with over a quarter closing in the last decade. Our industry is very vulnerable at the best of times.  We have just experienced one of the wettest winters on record, many of us are seasonal and have now missed 7 critical weeks of our season including Easter and May Bank Holidays which is what helps us through slow periods.

 

Self Employed as a Limited Company - we are being discriminated against

 

We were advised by our accountants on purchasing the Freehold of the pub […] to run the business as a Limited Company which we have done for many years. There are tens of

 


thousands of small limited companies that operate in this way. We are not earning fortunes looking for tax avoidance, we are following the advice of accountants to be tax efficient not avoidance. We employ local people, and tradespeople, pay all our taxes and vat and games duty, pay all our licenses, Premises License, Music License etc. Surely the Government must recognise this group of self employed people the same as Partnerships and general self employed have been recognised during this crisis. We are all in the same position and have sacrificed our businesses and livelihoods when we were asked to for the good of the nation.

Small Limited Companies Need Recognition from Government and to be treated fairly and equally and not discriminated against

 

Government Talk of Economy Bouncing Back

 

Government talk of UK economy bouncing back, other Ministers have also expressed this view, Government said they will encourage this in all types of ways. Government recognise that Pubs and hospitality have been one of the hardest hit industries, we were the first to close and possibly last to reopen but as yet we are not being given any indication as to when we can re-open. We ned to know specifically how Government propose to help small rural Public Houses and the Hospitality industry in general, as our industry relies on sociability and faces total collapse without further help. The initial measures and Government Support helped in the first 3 weeks, but totally inadequate there after

 

We need a package of continued help for the next 2 years to get back on feet. We need tax and vat wavered, financial help employing staff, compensation to cover losses in stock and trade.

 

Public Houses individually have paid thousands of pounds in insurance policies but our insurance companies do not want to know??

 

Loans

 

Why should we have to burden ourselves with more debt of a loan to save our businesses that were very viable prior to the virus, and may not be viable after, we just don't know, therefore in conclusion Government have left us in a totally perilous situation. Many Public Houses are not profitable enough to take on further debt and loans and burden ourself even greater.

 

Social Distancing

 

Social distancing for most Public Houses and Hospitality will be impossible, if we can only have a small number of customers in our premises, this will automatically make us

unviable. Will the Government support us through this period with further financial help in order to survive, other wise we may just as well close the door, we would not be able to pay staff or our bills, surely you must understand that?

 

Our small businesses have been left decimated by Government

actions, and our strong economy has been sent into free-fall . The nonsense I keep hearing that the economy will be in strong position to bounce

back, while I am for the power of positive thinking realism is more important than hope. This is going to take years to recover from , we don't want Ministers to sound like very well spoken double glazing sales men trying to

 


sell a line. So many businesses are interconnected that staggered opening program seems crazy to me. Small business need immediate help (not loans) to save our economy and jobs and prevent mass unemployment like never before.

 

At the age of 70 the stress, anxiety, uncertainty and depression that I risk from loosing my business from no fault of my own is unbearable - small rural Public Houses need help and fast. Our Government have and are treating us appalling , it's a total disgrace. It is simply not financially sustainable for us and millions like us to be left without additional major financial support (Not loans)

 

Yours devastated but still hopeful that you will understand the desperate plight we are faced with and offer the support we desperately need

 

[…]

 

We feel small limited companies should be given the same status as other self employed and the same financial package to help during this crisis which so far has not been forthcoming 7 weeks into Lockdown without any trade. Why have small Limited Companies been penalised? (I have also answered some of the questions on Treasury Committee evidence)

 

Self Employed as a Limited Companies

 

We were advised by our accountants on purchasing the Freehold of the pub […] to run the business as a Limited Company which we have done for many years. There are tens of thousands of small limited companies that operate in this way. We are not earning fortunes looking for tax avoidance, we are following the advice of accountants to be tax efficient not avoidance. We employ local people, and tradespeople, pay all our taxes and vat and games duty, pay all our licenses, Premises License, Music License etc. Surely the Government must recognise this group of self employed people the same as Partnerships and general self employed have been recognised during this crisis. We are all in the same position and have sacrificed our businesses and livelihoods when we were asked to for the good of the nation.

Small Limited Companies Need Recognition from Government and to be treated fairly and equally and not discriminated against

Government Actions due to Corona Virus Pandemic - Questions Answered What problems (if any) are individuals facing in claiming support from the Job

Protection Scheme and the Self employment - No support for small Limited Companies

 

Income Support Scheme?

How effective have these schemes been in maintaining employment and reducing job losses? - Maintained employment temporarily but long term not sure with such uncertainty and social distancing measures that will reduce our trade and customer confidence to go out and socialise, all very unknown

Is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that

fraudulent claims are detected?

 


Has the Government struck the right balance between targeting support and making it easy to access? Not enough financial support for Public Houses and Hospitality who have been hardest hit

Where has Government support been too generous and where has it not been generous enough? - Everyone received a grant of £10,000 but in some cases a hairdresser for example by themselves this may have been sufficient for their business to survive but Pubs like ourselves with much greater overheads, turnover paying more tax and

vat and alcohol duty we have received the same and this is totally inadequate for our business to survive. Pubs and restaurants have perishable stock and we were given just hours notice therefore had a cellar full of perishable stock and beer to the value of approximately £9,000 . The stock was all paid for however this will have to be thrown away as it will be out of date. Pubs need much greater support to cover our

losses. Insurance companies are not prepared to cover for loss of stock or business interruption. We pay £5,000 a year on insurance but will not get a penny in compensation. Hair salons or nail bars will not have to throw stock away but have received the same grant as many Pubs

 

How successful has the Government been in plugging the gaps in the schemes? - What gaps in coverage still remain and are changes required to increase their effectiveness? - Nothing for small limited companies and the £10,000 grant, business

rates holiday, is no where near enough for the amount of time we have not been able to trade and huge losses we have made.

How viable is it for the Job Protection Scheme and the Self-employment Income Support Scheme to be open for

longer? - Job Protection needs to be in place to retain jobs, without it mass unemployment

How and when should the Government’s support packages be wound up? - This will depend when business get back to normal trading, all restrictions lifted, most businesses will need help for another 1 to 2 years to get back and avoid mass unemployment

How should the Government prioritise which continuing sectors and groups to support as time goes on and ongoing

support is needed? - Those with restrictions that restrict normal trading and those industries already badly hit and under pressure Pubs, Restaurants, Hotels, Hospitality , Retail Leisure

What actions does the Government need to undertake to pursue to support a successful exit strategy? - Tax, VAT waivered for a period for small businesses , financial help to employ staff and retain staff

Support to businesses and Financial services

How effective is the Coronavirus Corporate Finance Facility, Coronavirus Business Interruption Loan Scheme, and the

Coronavirus Larger Business Interruption Loan Scheme? In particular, are these measures succeeding in preventing

viable businesses from potentially going under during the Coronavirus lockdown? - Not all businesses can afford to burden themselves with more debt in these uncertain times. No one knows when we will get back to normal

How effective has the Government support been so far in terms of coverage and speed?

- Business Grant we received week 6 of no trading not fast enough

What gaps are there for businesses within the schemes? - Small Limited Companies have not been recognised as self employed and are being discriminated against - we need same recognition as other self employed groups- why have Limited Companies

 


been penalised

Is the nancial sector supporting businesses enough? Are businesses getting the right advice on which grants/loans

 

May 2020

 


 

Written evidence submitted anonymously

 

1.       I am one of many self-employed people “falling through the cracks” when it comes to government support during the coronavirus pandemic.

 

2.       Even though I am to all intents and purposes self-employed (i.e. I work for various companies on a casual day-to-day basis with no guarantee of employment), I cannot claim via the Self- employed Income Support Scheme because more than 50% of my annual revenue comes from PAYE work with the BBC. If I am not classed as self-employed then you might reasonably intuit that I must therefore be “employed” and eligible for furlough. Indeed, I am on the BBC’s payroll with the relevant monthly deductions made for income tax and national insurance. The corporation prefers to pay its freelancers in this way and up until now this has never proved to be a problem. However, I, along with hundreds of other BBC freelancers, am now set to be unfairly penalised because of this preference.

 

 

3.       I have been informed that only PAYE freelancers working in the privately funded parts of the corporation can be furloughed on the Job Retention Scheme, while those working regularly in news and sports broadcasting are not eligible because it receives public funding

.

4.       Consequently, all of this means I am not eligible for ANY kind of government support because even though I am effectively self-employed the government will not classify me as such because my main employer chooses to tax its freelance staff at source rather than pay gross (as my other employers do).

 

5.       To compound matters, that main employer IS entitled to furlough PAYE staff (essentially classifying them as “employed”) – but only those working in certain departments. This seems iniquitous for those caught on the wrong side of the divide.

 

 

6.       All BBC departments have reduced output, cut rotas, merged teams, and seen staff cancel holidays – correctly so as it bids to limit the number of people leaving home. The number of available freelance shifts has dropped to almost zero as a result.

 

7.       At the start of this crisis the Chancellor vowed to do “whatever it takes” to support people and claimed “the self-employed have not been forgotten”, but many gaps still exist in the government schemes, leaving me with little or no income for the foreseeable future.

 

8.       It was pleasing to see a degree of flexibility with the decision to extend the cut-off date for the furlough scheme. I now call on the Chancellor to show similar flexibility to support PAYE freelancers, both at the BBC and elsewhere, by adopting the solutions put forward by the Federation of Entertainment Unions. This could be done by creating a new Freelance Worker Income Support Scheme using PAYE data collected by the Treasury or, perhaps more simply, by allowing those who fall below the 50% self-employed threshold to qualify for the Self- employed Income Support Scheme by assessing all income, both PAYE and turnover. The BBC, along with other broadcasters, has already written to the government to give its backing to this second solution. Such a change would allow the many PAYE freelancers currently without an income to follow the government guidance to stay at home to help save lives rather than desperately hunting for work wherever they can find it.

 

May 2020

 


 

Written evidence submitted anonymously

 

Dear Committee,

 

I trust this message finds you well and safe amid the most uncertain time our world has ever known and your team has done a great job in setting up a support framework for businesses that really need it. My problem is that I have seen many business owners frustrated with the banks service which is largely down to a simple lack of qualified and experienced people. Why? Because the likes of RBS let these people (Contractors) go and now are struggling to retrain or re-hire that level of person.

 

I have in excess of 50 people that have the relevant experience and are ready to go on an interim basis. I will take the people onto my books and deploy them on short terms assignments to the various banks. I can be so bold as to say I have people with exact bank experience (Barclays systems experience or RBS systems experience or Lloyds etc etc). This would allow a very quick take on.

 

I want your help, you can advise the banks of this availability and bolster their teams quickly thus increasing the decision rates for our SME markets.

 

My cost will be transparent and very minimal and if done with the compassion needed will be an outright success.

 

The reason for this interest is sparked by the constant news reel regarding the lack of loan progress and SME’s fighting for survival due to the banking sector not having the resource to cope with the demand.

 

We can help but we need your team to assist with getting our message out to the market.

 

May 2020

 


 

Written evidence submitted anonymously

 

My business is a micro business which employs three people. It is a conveyancing property law firm and I work from home. Two employees have been furloughed. Will they have a job to come back to? Probably not, at least not likely this year.

The company is a limited company and I am paid by a small salary and directors loan. I can not furlough as I have ongoing cases, albeit no income will be received as for the most part my clients can not move house at this time. This leaves me with no income at all. I still have business overheads to pay and of course personal overheads. The only thing I have been able to benefit from is a delay in paying my VAT, the VAT money being used now to pay overheads. It is an absolute disgrace that I and thousands of others have been left with nothing but debt.  We should have parity with the self employed schemes or employed schemes available.

The self employed is open to massive abuse. Why can they continue to work and make an income and still obtain 80% of their wages when a director can’t? If the government wants the economy to boom why are they stopping directors from working if they furlough? It is heartbreaking to see others bragging about their additional income and grants for premises when they are not required and others in my position looking into making themselves bankrupt or at worse considering suicide because they feel so desperate. On top of being completely ignored by the Chancellor and basically called a tax dodger and collateral damage, we pay our taxes and collect VAT for the government.

We are strictly monitored by various laws and everything we do is completely legal. I’m sorry to say this regarding the self-employed, but we all know they do not declare all their income, I personally don’t know one self employed person that does, so to zone in a small businesses as targets of ‘well you don’t deserve help because you don’t pay as much tax as everyone else’ is unforgiveable and massively damaging to the economy.

People who were on benefits before the lockdown where given more money, why? Lets face it as living costs go, you don’t need more money. There is nothing to spend it on and nowhere to go. They are sitting at home and have more money than they have ever had or require and once again thousands of others are left with absolutely nothing.

To offer micro businesses more debt in the form of bounce back loans is completely irresponsible. We have had 2 months with no income and there will be a further knock on effect, you are giving us debt to pay debt and get into more debt! Then you have companies that do not need help, bragging about just been given a bounce back loan and wondering what rolex they should buy. It is a joke.

The employees on furlough don’t seem to realise half of them probably won’t have a job to come back to. It is interesting and infuriating to see their responses when they think furlough may be cut to 60%. The comments are along the lines of ‘well I can’t live of that so I’m going back to work’. Try being in my shoes then, because I have been told to live on £0.00 and then give you your job back.

May 2020

 


 

Written evidence submitted anonymously

 

 

The very significant initial government financial support to the economic impact of the coronavirus should be recognised. However due to the speed and impact of the coronavirus crisis it is virtually impossible to consider and provide support in all situations and for all businesses in a relatively short space of time.

 

One of the situations which has been missed or forgotten for important financial support is owner managed small limited companies, particularly where the directors take most or all of their income as dividends.

 

Many of these businesses have lost most or all their income and for various reasons are not eligible to receive income support or grants. My business finds itself in such a position.

 

This seems unfair when compared with for example self-employed people who will receive income support packages.

 

The government has also recently introduced bounce back loans and there are also other loan schemes. Whilst these may be of value to some businesses and some situations, they increase the company’s debt without any certainty as to how and when that debt will be repaid.

 

My request is that the government introduces financial support for owner managed small limited companies equivalent to that being offered to self employed people, and that dividends from these businesses are taken into account when calculating income support.

 

 

May 2020

 


 

EIC0187

 

 

Written evidence submitted anonymously

 

Dear honourable gentleman and ladies,

I find it in bad taste when the country is hurting, when doctors/nurses are going without proper PPE and all keyworkers ,most of the sectors are not following social distance rules are being forced to work that

M.P.s  are being paid an extortionate amount to work from home firstly there should be no travel allowance so you would have saved money there secondly the P.M wants us to come together so the M.Ps should work from home without an allowance as they don’t have to spend time travelling to parliament and any M.P. who doesn’t or refuses should have there pay cut as that is what would happen to me the savings from this could be used in a number of ways.

1)      Giving tax breaks to keyworkers- rewards those forced to work during this and gets rid of the feeling only the rich get tax breaks it also gives some rewards to non nhs workers who do not have any companies helping them)

2)      Use it to buy more PPE for NHS and keyworkers to protect those going to work

3)      Use it to expand the furlough scheme so any keyworker with vulnerable or at risk family members can request to be furloughed at the moment it is only the extremely vulnerable the people at march you claimed vulnerable no longer are ie diabetics, children on ngt,children who have been on oxygen but are off it children who have had spacers in the past

 

 

May 2020

 


 

Written evidence submitted anonymously

 

 

 

Zero help for small company directors

Regarding the lack of support for working company Directors

 

You may have seen the news item on the BBC at 10pm on Saturday 2nd May. Below is another link from the BBC highlighting the same issues.

 

https://www.bbc.com/news/business-52308823

 

If this was not bad enough, as my PAYE is registered at the end of the financial year, i.e. after 19th March, I now qualify for zero assistance/support. I cannot even apply for minimum furlough.

In case that is not clear enough - zero!

 

I asked my accountant to investigate Director furlough arrangements. Here is his reply:

 

We have tried to make the claim, but unfortunately it has not been possible. Recently the CJRS guidance was updated to include a requirement that a 2019/20 RTS payroll submission must have been submitted including any employee for which a claim is made, by 19th March.

 

This causes a problem for annually paid directors who are only paid on a payroll at the end of March. I understand that the ICAEW has raised this with HMRC, but to date HMRC have not indicated any adjustment to the rules. At present it appears that annually paid directors, who were not included on an RTI submission by 19th March, will not be able to participate in the scheme.

 

To me this would appear to be a significant exclusion by the government. I would imagine that there are thousands of people with these circumstances given that many annual payrolls would be run at the end of March.

 

If there are any changes made to the scheme, I will let you know.

 

So now even this suggestion is completely hopeless. No sensible director wants to furlough themselves when they need to work even harder to protect their business. This is a last desperate measure and is still closed to me.

Please can you bring this matter up at the highest level.

 

This has now gone far enough, the government have had time to address the lack of understanding, but they either do not want to, or, worse still, they are ignoring the basic facts.

I have paid my taxes, on time, all my life. Including those of the employees I have supported in the past and looked after for over 25 years. Where is the help for me?

 

Despite having brought this matter to the attention of all of you, I have received no useful response or any acknowledgment of the facts. Who is listening? Who can I contact and how do I get through?? .. hello?? Are you listening?? Who is at the head of this policy?? Put me in touch.

 

1

 


 

Please do not send me a link of the list of help the government has worked up so far. None of it is any good to me unless you think it healthy for me to take on debt!?

 

Why should I need to even consider this if others are well supported?

 

This is an unprecedented crisis. The support from the government for most people is a lifeline. For me there is simply no lifeline.

 

All I ask is for a degree of support at least equal to that offered to others. The way we have been treated so far is shocking and clearly cynical. It demonstrates a serious lack of understanding, disrespect for the work we do, and the role we play as tax collectors for the treasury.

 

Please give me some hope. I have a family and a good business to support.

 

“Some people regard private enterprise as a predatory tiger to be shot. Others look on it as a cow they can milk. Not enough people see it as a healthy horse, pulling a sturdy wagon.’ - Winston Churchill

 


 

I thought you may be interested in this response from HM Treasury which unsurprisingly misses the point completely.

I have made my notes in RED, but I fear now that we have been truly fobbed off by people who clearly do not understand the issue.

I have to say that I find it very depressing.

 

From: Petitions: UK Government and Parliament <no-reply@petition.parliament.uk>

Sent: 29 April 2020 00:47

To:

Subject: Government responded to “Coronavirus Support Package for Directors / Shareholders of small Limited Co's.”

 

You’re receiving this email because you signed this petition: “Coronavirus Support Package for Directors / Shareholders of small Limited Co's.”.

 

To unsubscribe from getting emails about this petition: https://petition.parliament.uk/signatures/82070845/unsubscribe?token=G7PN90hMP_gT- Jh_86rK

 

 

Dear […],

 

The Government has responded to the petition you signed – “Coronavirus Support Package for Directors / Shareholders of small Limited Co's.”.

 

Government responded:

 

The Government has announced an unprecedented package of measures to support public services, workers and businesses through Coronavirus, many of which are specifically aimed at small companies. Yes ..

 

 

 

 

 

2

 


The Coronavirus is the biggest threat this country has faced in decades, and the Government recognises the extreme disruption it is having on people’s lives, their businesses, their jobs and the nation’s economy. Yes ..

 

That is why we have announced unprecedented support for public services, workers and businesses to protect against the current economic emergency, including measures specifically for (SOME) small companies,

 

such as:

 

The new 100% backed loan scheme for small businesses. Small businesses will benefit from a new fast-track finance scheme providing loans with a 100% government guarantee. Businesses will be able to borrow between £2,000 and £50,000 and access the cash within days. Loans will be interest free for borrowers for the first 12 months, after which interest will be fixed at a low rate. Businesses can apply online through a short and simple form. Ok for those who want to undertake the commitment of borrowing against an unknown future.

 

The Small Business Grant Scheme. Through this scheme, the Government is providing additional funding for Local Authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBRR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of

£10,000 per property in receipt of reliefs, to help meet their ongoing business costs. In addition, the Government is granting small businesses in the retail, hospitality or leisure sectors a higher grant of £25,000 per property, for each property that has a rateable value above £15,000 and below £51,000. Not relevant to small companies working from home base.

 

The Coronavirus Business Interruption Loan Scheme. The Government provides lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give them further confidence in continuing to provide finance to viable SMEs. The government will not charge businesses for this guarantee and will also cover the interest costs and fees for the first 12 months. Ok for those who want to undertake the commitment of borrowing against an unknown future.

 

The Statutory Sick Pay Rebate. This will allow small and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for staff sickness absence due to coronavirus. This refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because they have been ill with Covid-19 or have had to self-isolate because of it. The Government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible. Existing systems are not designed to facilitate employer refunds for SSP. Not relevant to this issue.

 

In addition, the Government has put in place schemes to maintain the links between employees and companies, and support living standards, alongside other changes to the welfare system. Not relevant to the issue. Unless they mean it is easier to apply for income support if your business folds.

 

The Self Employment Income Support Scheme (SEISS) will provide grants to eligible self-employed people, or members of partnerships, worth 80% of their trading profits up to a maximum of £2,500 per month. It is based on income from self-employment or a share in a partnership as reported on a UK income tax self- assessment return. Whilst the government understands that some business owners choose to pay themselves in the form of dividends, under current reporting mechanisms it is not possible for HM Revenue and Customs to distinguish between dividends derived from an individual’s own company and dividends from other sources. HMRC are designing SEISS to require almost no new information from the customer, in order to make it deliverable by early June. Expanding the scope would require HMRC to collect and verify new information which would take longer to deliver and put at risk the other schemes which the government is committed to delivering as quickly as possible. Here we have the issue laid out clear. If we were to be included, it would put the existing schemes at risk! Did I get that right?

 

This is clearly not a fair approach. Self-employed have been offered support (SEISS) but directors cannot access the same scheme as some may have been paid via dividends. I have received minimal dividend payments and it may be that any such payments are excluded, but I would like to have the 80% of my PAYE salary no matter how small, AND be able to continue to support my company and customers the same as the ‘self-employed’ are able to do under the SEISS scheme. This put me in an unfair situation through no fault of

 

 

 

3

 


my own. My PAYE earnings are as easy to verify and collect as anyone. Probably easier than the self- employed...

 

However, those who have incorporated, and receive income from the company as an employee, may benefit from the Coronavirus Jobs Retention Scheme by furloughing themselves from their roles as employee and director of their own company in addition to the other forms of support for small businesses note above. This means that company owner-managers may be eligible for a grant of 80% of the salary they have paid themselves. As above this option is simply not available to me. Even if it was, this is a sure way of slamming the brakes on any Ltd company! It is therefore not a viable option for those of us who want to protect our customers and the companies we have worked hard for. I would like to have the 80% of my PAYE salary AND be able to continue to support my company and customers in the same way as the ‘self-employed’ are now able to do. Even if I could furlough myself this states that ‘I cannot work to gain any revenue for my company’ but only act on the director responsibilities.

 

HM Treasury

 

Click this link to view the response online: https://petition.parliament.uk/petitions/310515?reveal_response=yes

The Petitions Committee will take a look at this petition and its response. They can press the government for action and gather evidence. If this petition reaches 100,000 signatures, the Committee will consider it for a debate.

 

The Committee is made up of 11 MPs, from political parties in government and in opposition. It is entirely independent of the Government. Find out more about the Committee: https://petition.parliament.uk/help#petitions-committee

 

Thanks,

The Petitions team

UK Government and Parliament

 

 

I have a good business. I will be part of the set up that will be needed to bring this country out of recession. Promises of support for new companies is welcome but do not neglect the existing ones. Do not cut off our legs.

 

I am desperate, and feel hopeless, only because no one from the government either acknowledges, or understands the issue. Or worse is ignoring it altogether. If it is not ignorance, then it may be something more disturbing.

 

Clearly, we are not ‘in it together’.

 

For me, under the current schemes on offer, there is literally zero support. This is simply not fair.

 

Regards […]

 

May 2020

 

4

 


 

Written evidence submitted anonymously

 

Falling between the Gaps

 

 

This is very simple really.

 

 

I approached and accepted a new job with a competitor of my existing employer, the Walstead Group. I was very unhappy with my existing employer and had been working for them for 7 years.

 

 

I resigned on February 5th, 2020. I had 3 months’ notice to serve, as I work in sales. Its all part of my contract, and I was placed on Garden leave. I was due to start with my new employer, YM group, on May 6th.

Walstead did all they could to keep me, but my mind was made up. More money cannot buy happiness in your work.

Then the effect of the Virus took effect, and the new employer could not start me on May 6th, and at the time of writing they don’t know when they can start me. They furloughed members of their sales team.

As of May 6th, I am now unemployed with no income for the first time in my life. I started work at 16, and I am now 57.

I asked my previous employer if they could keep me on the books and furlough me but they would not.

I am between a rock and a hard place…..what do I do? There should be support for someone in my position please.

 

 

May 2020

 


 

EIC0197

 

 

 

Written evidence submitted anonymously

CORONAVIRUS SUPPORT FOR BUSINESSES NOT ACCOUNTED FOR

 

My business is based at home offering accounting and taxation services and I ensure all of my clients pay their taxes correctly – even those that don’t think they should!

 

I applaud the Government’s quick response to help for businesses and individuals and can only guess at the huge admin issue this will have been. However, I do feel there are a number of businesses that have been forgotten. A couple of examples of which are below:

 

Example 1

[…] – A business run by […] the director who has worked his socks off to build up his business to enable him to comfortably support his wife and 4 children. He does not have business premises as he does not need any as he is going from job to job in his van. He has worked hard to obtain contracts with chains of hotels and has the contract for […] where he cleans their carpets on a regular basis. He has not been able to work at all and does not run a payroll scheme so could not even furlough himself. His salary package is made up of a minimum salary and then dividends. He was in the process of reevaluating this for the future particularly as his business was growing and he was considering taking on staff as the business grew. He has received no help and has not been able to claim Universal Credit because he had borrowed some money to build an extension just before the crisis so this means he has more than £16k in the bank even though it’s earmarked for the build which he needs so he can look after his disabled mother.

 

Example 2

[…]

Similar situation to above, […] the director had gained some decent contracts at holiday camps such as Butlins in Bognor Regis but has had all contracts put on hold. He is able to do some private households but a lot of these are elderly and they are not keen for him to come to the house even if he is outside. Some of his customers who do allow him to clean their windows are only able to pay in cash which of course is not ideal currently. His wife works and is furloughed but his business can’t claim anything.

 

Example 3

[…]

We employ 4 people and run two offices based at home. We have furloughed two employees but both my fellow director and I can’t furlough as we are very busy doing payrolls and helping clients through this time. We are advising clients to pay their staff and suppliers first if they can afford it. I have been working in my home office since 2007 but didn’t register with my local council as the information available at the time suggested I didn’t need to. Clients do visit me here for meetings.

 

 

 


 

May 2020

 


 

Written evidence submitted anonymously

 

I’m contacting you about the lack of help for the self employed.

 

 

My husband and I are both osteopaths. We run a limited company. Like many other workers we each earn below the 50 k limit for the self employed to get help and yet we are excluded from the provision for the self employed.

 

 

We now have no practically money coming in, we have our domestic outgoings like everyone else, a mortgage etc, and in addition all the overheads including the rent on one of the clinics we work at. This is in the form of a ‘serviced office’ so we cannot claim small business grant, although this is offered in Wales, and, I think, Scotland. Also we cannot get a rent break.

 

Our other clinic is located inside a health centre/gym, which has been closed so we arenot having to pay rent there.

 

That closure resulted in our losing 5days work per week.

 

At the other clinic my husband has 2 days but there are fewer patients coming at the present time and there need to be long gaps between patients to maintain distance and give time for cleaning procedures so my husband has gone from seeing 60 patients per week in total to seeing approx 7 patients.

 

If we can’t pay that rent (and we don’t know how long this will go on for) we will lose those premises and then when this is over where will we work? This rent alone is £1900 per month, we also have other overheads, which together with the rent total about £2,500 per month.

 

We can’t get a small business grant of £10,000 to which other businesses are entitled because we don’t pay rates on our premises. There is no help for us and for others in similar situations.

 

We want to have a business to come back to when this is over, I don’t know how we can do that with the current level of help on offer.

 

This crisis could use up anything we have set aside for retirement just to live on. I was planning to retire at 70 and this crisis could mean I’ll be even older.

 

I can’t understand why we arenot being helped, it would be very simple to look at our income and the tax we have paid and work something out like they have done

 


for other self employed. Or to just offer a grant to help with the running costs which still have to be met.

 

Why do we take dividends? We are not tax dodgers. We pay tax, it can be demonstrated. Each month we don’t know what our income will be. Last April we were both off sick with flu. We earned practically nothing that month. We have to prioritise the fixed costs for the business so we can’t give ourselves a bigger salary. When both clinics are open our fixed costs are in the region of £5,000 per month. We don’t get any help with pensions, holiday pay, sick pay, we often have to use a private GP so as not to interrupt work too much so we use the NHS less. I have always believed in paying tax. Politicians always look for a vote by offering a tax break as if it’s an okay thing to do.

I’ve never voted on the basis of saving money on tax. But when we have a perceived tax break which has come about through the way the system has been set up - and it wasn’t set up by us - we are demonised.

 

IN CONCLUSION we need help in two areas, more help with personal living expenses and help with premises costs for those who are not registered rate payers.

 

 

Please can somebody understand this.

 

May 2020

 


 

Written evidence submitted anonymously

 

I am self-employed but all my contracts are PAYE freelance. This means that the company that hires me gets the benefits associated with PAYE but I do not get any benefits of either being a permanent member of staff or a self-employed person.

 

I have no choice in being paid via PAYE system, if I want the job I have to abide by the hiring company’s rules.

 

Because almost all my self-employed income is via PAYE freelance pay I am not eligible for SEISS. I am also not eligible for Universal Credit and my landlord refuses to accept housing benefit and will not reduce the rent.

 

All the work I had confirmed for March onwards has been cancelled due to Coronavirus. All my future work has also been cancelled due to businesses folding completely due to Coronavirus or because they’ve lost so much money they’re not going to be hiring extra staff like me for the foreseeable future.

 

I have been thrown into poverty in a matter of weeks and I have been given absolutely zero government help, despite paying taxes via the same system as furloughed workers.

 

Will I be expected to pay higher taxes after this crisis to pay for bailing-out the furloughed workers? How is that fair? I’ve lost my livelihood as a result of this crisis and been given no support.

 

HMRC have a very clear record of my earnings and how much tax I’ve paid because as a PAYE freelancer, I am taxed at source. What’s the difference between me and a furloughed worker? I don’t get bailed-out by the government despite being paid in the same way.

 

I will now have to leave my flat, so my landlord will have an empty property for a while and won’t have rent coming in.

 

I’ll have to try to sell as many of my belongings as possible and move in with my parents in Hertfordshire. My partner will have to move to his parents on the Isle of Wight.

 

We are 48 and 44, we’re not kids, we’re senior professionals working in London in specialised fields. We’ll never get on the property ladder now and will need to rely on some kind of state benefit to survive for the next six months to a year, at least. We won’t have money to spend on holidays, restaurants, clothing, food and other items as we used to. If we had money coming in, we would still be contributing to the economy, now we can’t.

 

If the government had treated PAYE freelancers the same way as other PAYE workers we wouldn’t be in this situation.

 

We will not forget what the conservative government has done.

 

May 2020

 


Written evidence submitted anonymously

 

 

FALLEN THROUGH THE CRACKS

 

 

I am a PAYE freelancer in the film and TV industry. My contracts can be for anything from 1 day to 23 weeks. Prior to lockdown I had just finished a 5-day contract for the BBC on Casualty. I was then due to start 23 weeks work for Red Planet on a popular TV series for the BBC. Once I had agreed terms for the Red Planet contract I subsequently had to turn to down two other offers of work as they clashed with the one I had just agreed to – one was for Netflix. So there was plenty of available work around.

 

As a result of the lockdown all work in the sector has either been cancelled or postponed. The lockdown occurred just prior to my contract being due to start, so I was caught between finishing a contract for one company and starting a contract with another company. As the industry has shut down there are no opportunities for employment.

 

Neither of the companies I was contracted with before and after lockdown announcement is in a position to furlough me. I am not self-employed so cannot go down that route for assistance. I applied for Universal Credit in March and am still waiting to hear if I have any entitlement, however as I have a small pension coming in I doubt I will be entitled to UC, even though the amount of pension I receive only covers a small portion of my regular direct debits/standing orders like insurance, council tax, mortgage, gas, electric etc.

 

I manage to earn an average annual income which covers me for any quiet periods when I am not able to get any work. This quiet period for me was during this winter just gone, and I was very much relieved and looking forward to starting the long job with Red Planet, so any ‘savings’ had already been used to see me through the quiet winter period.

 

It seems not a little unfair that there are a lot of people being supported financially by the government and there are those, like myself, who fall between the cracks, and therefore will not be able to assist in kick-starting the economy again as we make those tentative steps easing out of lockdown. As I am PAYE the government has had the benefit of receiving my tax and national insurance contributions immediately rather than having to wait until the end of the tax year. I am sure that post-Covid 19 the tax-payer will be required to re-pay the massive financial cost of the government assistance to many individuals and self-employed people with higher taxes, which I will feel extremely peeved about paying when I have been left out in the cold, after I have been a tax-payer the same as all those people who has been able to receive assistance. I know that life is not always fair, and I would never want free handouts, but come on, if the economy is going to need my help then I also need yours. There a many people in a similar situation both in the TV and Film Industry as well as in other industries.

 

May 2020

 


 

Written evidence submitted anonymously

 

I am a small business owner who has been left out of income support schemes and I urgently need your help.

 

I am a Location Manager and Line Producer working on UK Independent Feature Films and TV shows.

I was advised by my industry to trade as a Limited company around 5 years ago to put myself in a better position for gaining work in the industry. I also take decisions on behalf of the production company with regards to health and safety issues along with supplier and crew contracts that have some obvious liability implications, hence the requirement to be Ltd.

 

My company is […].

I am the sole director of this company and turn over on average 30k per annum. I have a PAYE scheme in place that pays me £719 per month directors salary.

 

The rest of my income is taken in dividends dependant on my profits and with regards to availability of work & the seasonal nature of the film & TV Industry.

Currently furloughed with an income of just £575 per month from the PAYE scheme and with no indication when our Industry will restart to bring back the huge economic and cultural benefits to the economy that it provides.

 

I am supporting the #ForgottenLtd campaign, which represents directors of small limited companies who are not eligible for self-employment income support.

I am asking for the Treasury to reverse this policy and put us on an equal footing with the self-employed.

Many of us don’t qualify for small business grants as we’re not in commercial premises. Taking on debt to support our livelihoods isn’t an option. Without rapid assistance, many of us will go under – costing jobs today and crucially those we could have created in the future.

We are calling on the government to immediately protect our incomes by extending SEISS to encompass small limited company directors based on all income for the last 3 years capped at £2,500. To include PAYE (except where already furloughed), dividends and/or income classed as repayments to a director's loan for companies not in profit.

We would also ask that you:

 

1)      Allow furloughed directors to continue to work to support their businesses

2)      Extend Business Support Grants to all small businesses

 

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees?

Please correct these flaws in the support schemes before it is too late for many small business owners, their employees, their suppliers, and their families.

 

 

 

May 2020

 


 

Written evidence submitted anonymously

 

I am a small business owner who has been left out of income support schemes and I need your help.

 

I am a sole director and employee of a consumer electronic brokering company – […] which I set up in 2013.

 

I am supporting the #ForgottenLtd campaign, which represents directors of small limited companies who are not eligible for self-employment income support – a deliberate choice by the Treasury.

 

I am asking for immediate representations to the Treasury to reverse this policy and put us on a equal footing with the self-employed. Many of us don’t qualify for small business grants as we’re not in commercial premises. Taking on debt to support our livelihoods isn’t an option. Without rapid assistance, many of us will go under – costing jobs today and crucially those we could have created in the future.

 

We are calling on the government to immediately:

 

1)  Protect our incomes by extending SEISS to encompass small limited company directors based on all income for the last 3 years capped at £2,500 per month

To include PAYE (except where already furloughed), dividends and/or income classed as repayments to a director's loan for companies not in profit

 

2)  Extend Business Support Grants to all small businesses We need support now to save and sustain our businesses.

 

3)  Allow furloughed directors to continue to work

No one should be forced to abandon their businesses, nor punished for unwittingly undertaking any action that may be deemed fraudulent. We need to be in the strongest position possible to emerge from this crisis intact and to play our part in the country’s economic recovery.

 

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees?

 

Please now is the time for the Treasury to correct these flaws in the support schemes before it is too late for many small business owners, their employees, their suppliers and their families.

 

May 2020

 


 

Written evidence submitted anonymously

 

Evidence to demonstrate the problems individuals are facing in claiming support from the Job Protection Scheme

Evidence to support the ineffectiveness of these Schemes

Evidence to support that Government has not been plugging well-publicised gaps in the Job Protection Scheme

 

Executive Summary

 

 

My Evidence

 

1.       After securing the job in January, I started in a new job with a travel company on 24 February 2020. On 7 March, I was advised that my job was ‘at risk’ due to the dramatic impact of C-19 on the travel industry. Shortly after that date the Government launched the Government’s Job Retention Scheme. The company asked me if I would accept being furloughed. As the only regular earner in a family of 4 (2 kids in education), I naturally accepted. At the time of the launch, I was eligible for the Scheme.

 

2.       The Government then extended the date from 28 February to 19 March, purportedly to extend the benefit to more individuals. In doing so, they introduced a requirement for an RTI submission to have been made in respect of an eligible employee before 19 March.

 

3.       As I started too late in the month to be included in February’s payroll, I was paid in March in respect of both February and March. This means, I did not appear on the RTI information until after this new cut-off date and my employer was therefore unable to claim. I have now been made redundant because the company is unable to afford to keep me on.

 

4.       As an HR Director, I can confirm it is common that individuals starting later in the month are paid in arrears as far as their 1st salary payment is concerned. This is especially true when Payroll is outsourced to a 3rd party as is my case.

 

5.       The introduction of this criteria therefore REDUCED the number of people that could access the benefit. The RTI date of 19.3.20 only benefitted those who are weekly paid or were employed in the main during January/early February. Anyone who is monthly paid and started just before/after the 28 February do not qualify.

 

6.       The RTI requirements was deemed to be necessary to avoid fraudulent claims. However, there are numerous ways to verify someone’s eligibility – I have, e.g., a signed and dated Contract of Employment. In fact I think, there are many employers who may be claiming for employees who have been made redundant and not furloughed and so I think this is an inadequate and unhelpful criterion!

 


7.       I have recently learned that I am not alone and have joined the membership of New Starter Justice – an online campaigning group with nearly 10k members. I have also been in contact with my MP (Greg Clark) who claims to support my/our cause. Despite this, the Government continues to ignore me/us or refer us to the fact we can access JSA and UC and/or return with begging bowl to previous employers. I for one, cannot return to a former employer, having spent a couple of months out of work before securing my new job. Besides, if the whole purpose of the Scheme was to protect jobs, this practice is contrary to its aim: former employers are likely to have filled the vacant position and are therefore inflating their payroll costs in the short-term only to let people go once the furlough grants cease. They also suggest that there are winners and losers with any Scheme. Whilst I can accept this, the fact I was in one minute and out the next, just adds insult to injury and smacks of a Scheme that was not thought through.  Just as concerning is the fact that the Government appear not to understand payroll processes. They just don’t seem to grasp that extending the date to 19.3 for new starters and then imposing a deadline of 19.3.20 for the RTI submission is absolute nonsense!

 

8.       Many of the individuals who have been affected by this loophole, are professional people who have chosen to move jobs to progress their careers. This indicates that they are successful, high performers. I for one have progressed my career over 30 years, paid higher- rate tax for much of that period and own my own property (mortgaged) and car. I’m not excessive in my spending but our family costs equate to around £2,500 per month.

 

9.       I do not qualify for UC but I do qualify for contribution-based JSA which is £74.35. Anyone can see that this is a significant shortfall on what I need to cover my monthly expenses. I cannot claim housing benefit or means-tested JSA because my partner works. However, he is self-employed and has not been able to work because he is a painter/decorator and can’t enter people’s homes due to social distancing/lockdown.

 

Summary

 

In conclusion, despite the fact that I was employed prior to 28 February 2020, my role disappeared solely due to C-19, payroll cut-off dates were not within my control, the Government has placed an insurmountable barrier to me, and many others, claiming what they suggested I am entitled to.

 

Solution

 

For the Government to remove March RTI requirement to April and seek other means of verifying eligible claims such as Contract of Employment.

 

May 2020

 


 

Written evidence submitted anonymously

 

 

I am a small business owner who has been left out of income support schemes and I urgently need your help.

My company is […], I am a sole director/employee, I am in project management within construction and property sector, my company registration number is […], this is my 6th year of trading. I do not have premises, therefore no rateable value and no grants are available.

Company Directors have been ignored, vilified, and insulted, the lack of parity of support is discriminatory and unjust, unless it is urgently rectified it will affect the economy of our country for many years to come.

Company Directors have been ignored, vilified, and insulted, the lack of parity of support is discriminatory and unjust, unless it is urgently rectified it will affect the economy of our country for many years to come.

I am supporting the #ForgottenLtd campaign, which represents directors of small limited companies who are not eligible for self-employment income support.

I am asking for the Treasury to reverse this policy and put us on an equal footing with the self-employed.

Many of us don’t qualify for small business grants as we’re not in commercial premises. Taking on debt to support our livelihoods isn’t an option. Without rapid assistance, many of us will go under – costing jobs today and crucially those we could have created in the future.

We are calling on the government to immediately protect our incomes by extending SEISS to encompass small limited company directors based on all income for the last 3 years capped at £2,500. To include PAYE (except where already furloughed), dividends and/or income classed as repayments to a director's loan for companies not in profit.

We would also ask that you:

 

1)  Allow furloughed directors to continue to work to support their businesses

 

2)  Extend Business Support Grants to all small businesses

 

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees?


 

Please correct these flaws in the support schemes now, before it is too late for many small business owners, their employees, their suppliers, and their families.

May 2020

 


 

Written evidence submitted anonymously

 

To whom it may concern, I hope you are well.

I’m a freelance TV worker in my late-twenties and after deciding on a change of career direction at the beginning of the year, I had a very quiet beginning of 2020 work-wise, gaining only a week’s worth of work until the end of February when I was delighted to take a role at a company I love- and used to work for in another department. I continued working for them until early April when the decision was made to furlough myself and fellow colleagues at the same mid-junior level.

At the time, I felt very fortunate to be able to receive this support for the government and, it must be said, extremely proud of the way the powers that be were taking responsibility for the people of Britain in this strange time.

However, only last Thursday, I learnt from the firm that handles my company’s payroll that I was ineligible for furlough for a reason completely out of my control. I began my contract on 24th February which means that the company decided my first paycheck would be processed at the end of March to encompass this month and the week I did in February. This, I have since had confirmed by an accountant, is a very normal way for companies to operate their payroll. What it did mean though, is that I was obviously not registered on HMRC payroll via an RTI submission until the end of March since the company pays its employees within the first 6 days of the new month. And, as a result, I wasn’t eligible for the furlough I was scheduled for due to my RTI submission falling after the Government-set date of 20th March, despite starting my job nearly a month before this cut-off date. On top of this, I am ineligible for self-employed furlough due to more than 50% of my ‘self-employed’ income coming from PAYE last year, since I’m still relatively junior. So now I find myself essentially jobless and unsure when I will be able to get another job in TV, which has all but closed down due to this terrible situation.

I am aware the government has made efforts to make furlough more inclusive by moving back the previous RTI deadline from 28th Feb to the 20th March- but I would argue that this new seemingly arbitrary cut-off date is highly unfair on the tens of thousands of people like myself who began jobs in the 2nd half of February and the 1st half of March, before the coronavirus situation had ramped up.

Nevertheless, I am aware that I am one of the lucky ones here. I am in a fortunate position that I do not have children yet. I do not have a mortgage to worry about. I am currently single and therefore do not have to support a partner. But in spite of all this, the government’s decision to deny my right to furlough support during this incredibly tough time is leaving me struggling to pay my rent and my bills. More importantly though, having read stories of others in my situation, it’s genuinely heart-breaking to hear how much difficulty people with many more outgoings and dependents than myself are being put through- and all through no fault of their own. Simply because they decided (or perhaps simply had to) start a new job at this time.

Starting a new job should be seen as something brilliant and exciting- on both the individual and national level. Not only does it represent an individual either starting or continuing to support themselves as they look to either just survive or expand their horizon, but it also contributes to the wider good through taxes paid through every penny this person earns.

However, in this case, it truly feel that the government is penalising people simply for starting a new job at a certain time, and in doing so, they are making survival extremely hard for so many people across Britain. I would argue that it would be only fair for the RTI

 


cut-off date to be extended further from 20th March to the 31st March, so as to allow those who began new jobs late Feb-early March and who are being unfairly denied support through no fault of their own to also be entitled to the generous support that so many workers across Britain have already been given. This would not only provide people in need with much security at this tough time but also provide them with the stimulus to contribute to the economy in the near future, which will no doubt need all the help it can get.

Many thanks for reading my evidence and I wish you all the best with your inquiry- stay well,

 

May 2020

 


 

Written evidence submitted anonymously

 

As a PAYE Freelancer, I'm a music programmer for Television and Radio and take on fixed term contracts that may be extended, such is the nature of the work.

My last contract for Channel 4 ran from […].

With fixed term contracts usually being extended at short notice, this was originally a one month contract which was extended on a month to month basis ending in February.

When you do this kind of work, you always have a reserve of funds, just in case your contract ends, which I did at this point and found out just 2 weeks prior that the contract was ending.

I then sought other work and managed to secure some Producing shifts with BBC Radio […]. I did 2 'shadowing' shifts (these are always unpaid) and was due to start on Monday 23rd March, the day of the lockdown.

The contract was then cancelled as freelancers were not permitted onsite due to Covid-19. As the contract never started, I was not paid, meaning that the BBC could not furlough me.

 

When the JRS was announced, I approached my previous employment agency Handle and asked them if they could rehire me and furlough me,they were extremely empathetic and said that they would like to but their hands were tied because at that point, the guidelines were that I had to have been on the payroll on the 28th February, as my last pay was on the 14th February, I missed the cutoff by 2 weeks.

As advised by Rishi Sunak to many falling through the JRS loopholes, I applied for Universal Credit, only to wait a month and be informed that I am ineligible as my Partner's 80% furloughed income was just above the threshold based on the household income.

 

Since then, the date for JRS has changed to the 19th March, which looks like it helps many, but doesn't highlight the small print about the RTI, meaning many hundreds of thousands are still in the same position, for myself, it actually takes me much further away from the original cutoff date of the 28th February.

 

It has now been 12 weeks since I had any income, of course, I was prepared for a shortfall between contracts, but not prepared for anything like the financial impact of Covid-19. Any financial reserve that I had is now long gone and not being able to claim Universal Credit or any financial help from the Government, despite paying tax my entire working life is really, grossly unfair.

I've always been financially independent, so to have to rely on my partner's furloughed income is a huge blow when everything is usually 50/50. As a private renter, there are no mortagage holidays for us, no deferring of bills, we're using evey penny of his furlough just to keep a roof over our heads.

 

Just yesterday, a friend of mine in the same position as me shared a response that he received from Rishi in regards to the JRS, as below:

 


 

 

 

The main point I would like to highlight is below:

 


 

 

If I'm right in what I'm reading, the letter states that 'if someone was on payroll before the 28th February and left for any reason it is perfectly possible for them to ask their old employer to take them back and to be furloughed.'

As per the letter, I was on the payroll before the 28th February, so can I be furloughed? My previous employer want to do so but it's so very confusing as this goes against the guidelines as per the website they are following as below:


 

This states that I had to have been employed on the 28th February and is not in line with Rishi's letter.

 

At this point, I'm really at a loss as to what to do, my previous employer want to help me but their hands are tied and the guidelines come with so many caveats and confusing information.

As per Rishi's letter, he expects Employers to do the right thing, mine want to but cannot due to current guidelines which goes against what is stated date wise in Rishi's letter.

With the media industries being hit hard by the pandemic, I very much doubt that I'll be able to get any other work for the foreseeable future, so am looking at jobs in other areas at a much lower wage than previously just so I can get back to work, however in the meantime, surviving on 0% of my usual wage as a tax payer my entire working life is really nothing short of madness.

I'm not a fraud or collateral as Steve Barclay so eloquently put it last week, my PAYE tax payments are registered with HMRC, so why can't this be used as proof that I have been employed and paid my taxes to be eligible?

 

So, my question is, knowing the above information, can my previous employer rehire and furlough me under the current guidelines?

If not, then what other help is available or when will the guidelines be changed to help myself and many thousands of others that fall through the loophole?

 

May 2020

 


 

EIC0238

 

 

 

 

 

Written evidence submitted anonymously

 

 

Re: Closure of […] Restaurant’s

 

This is to confirm that it is with great regret that the […] have made the difficult decision to close all of its London restaurants effective 17th  March 2020, until further notice.

 

Under the circumstances and following the Government’s announcement that no-one should be going to Bars, Clubs, Theatres or Restaurants, this move was becoming increasingly inevitable. Crucially as the virus transmission increased, we needed to put the health and safety of our staff and customers at the forefront of our decision making.

 

This information is given in the strictest of confidence, without liability.

 

May 2020

 


 

Written evidence submitted anonymously

 

Job Protection Scheme and Self-employment Income Support Scheme

 

         How effective have these schemes been in maintaining employment and reducing job losses?

         Based upon feedback from our SME client base, effective through furlough

         Is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that fraudulent claims are detected? Impossible to answer

         Has the Government struck the right balance between targeting support and making it easy to access?

         There are a lot of gaps/circumstances being missed, business is rarely Black/white

         Where has Government support been too generous and where has it not been generous enough?

         The balance seems about right, however this is time dependent. If the support is not offered in the longer run, the cost of failed business will still be borne by the Taxpayer through Unemployment benefit/Universal credit/Council tax Reliefs and lost revenue to HMRC etc

         How successful has the Government been in plugging the gaps in the schemes? Although responsive, there are still gaps

         What gaps in coverage still remain and are changes required to increase their effectiveness?

         My business is typical of tens of thousands and is not offered any small business grant. I work from an office in the Garden. I am Owner/Manager domestic rates only, therefore no grants available. Business Income for March and April 2020 dropped by 95% and is unsustainable in the medium term. The small Grants of up to £10,000 should be opened to all the businesses working from home.

         How viable is it for the Job Protection Scheme and the Self-employment Income Support Scheme to be open for longer?

         That is dependent upon Lockdown and return to work conditions, as long as work cannot proceed, you need support. I am mindful that this cost all has to be borne by the Taxpayer eventually

         How and when should the Government’s support packages be wound up? When all business can return to work. Phased reduction over a 1 or 2 month period to allow planning.

         How should the Government prioritise which continuing sectors and groups to support as time goes on and ongoing support is needed?

         Which groups of businesses will have the greatest/cost benefit? Psychologically you need to see retail back to normal, people in the High Street again, pubs and restaurants, but these sectors also present greatest health risk. What is the financial impact of the different sectors, which sectors provide greatest trickle down economic benefit ? your researchers/HMRC must have data ?

         What actions does the Government need to undertake to pursue to support a successful exit strategy?

         Weigh the long term more, although support measures are expensive to the taxpayer, premature resumption will be even more expensive. Consult with the opposition, try and agree some non party political positions. Crystal Clear communication about “what , why and when. Make clear that the cost has to be borne by taxpayers, because not raising taxes would be irresponsible.

 

Support to businesses and Financial services

 

         How effective is the Coronavirus Corporate Finance Facility, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Larger Business Interruption Loan Scheme? In particular, are these measures succeeding in preventing viable businesses from potentially going under during the Coronavirus lockdown?

         Only experience us with CBILS which has been ineffective because of the time to process by the banks. Banks fear bad debt and don’t have the credit trained staff to be able to assess the volume of applications

         How effective has the Government support been so far in terms of coverage and speed?

         The support has been offered but banks and lenders are slow to implement as stated above

         What gaps are there for businesses within the schemes? Priv Ltd co. working from home get little support

         Is the financial sector supporting businesses enough? Are businesses getting the right advice on which grants/loans to access?

 


         As a member of the NACFB, we are unable to charge clients and prospective for any guidance on these matters. Who pays our costs ? As a business we have no income in the current climate but can’t furlough myself because of our FCA obligations . The banks don’t have the trained staff and are not impartial

         What are the financial regulators and the financial sector doing to reduce the risk of people being taken advantage of by fraud at this time, in particular with regard to vulnerable groups? FCA has published guidelines and the NACFB has set out a position for it’s members

 

Other government intervention

 

         Should the Government intervene more actively in redeploying staff and resources to certain sectors of the economy (health/food delivery)?

         No, tell the private sector what is needed within food/health and let them deliver to specification

         Should the Government intervene more actively in terms of state aid, bail-outs and its industrial strategy?

         That’s Cost/benefit analysis. Taking account of the financial impact of failure over the medium term, what is the short term cost ? Society can’t afford for the major banks to fail, they underpin the movement of money/goods/services. You can afford to see a couple of smaller bank’s lenders fail, it’s a healthy warning to others. The same is true of the Insurance industry which must be at risk from the pending claims. Outside financial services, it’s the economic impact assessment against the concept that business cannot be allowed to fail.

 

Economy, public finances and monetary policy

 

         What economic challenges may arise as the public health and social distancing policies are lifted and the economy begins to recover? What preparations can be made to manage these challenges? For example, could there be difficulty in restarting sectors of the economy quickly, a risk of a spike in inflation, or pressure on the UK balance of payments?

         Business insolvency will materialise resulting in job losses and bad debt in the financial system. BoE to ensure Capital Adequacy in the banks. Credit appetite will therefore be reduced in the lenders at a time when the economy has a greater need, consider extending COBILS. The risk of a spike in inflation is in my opinion, not great, raw materials, fuels, supply prices have dropped significantly.

         Is the economy’s recovery likely to be shallow or sharp? With the right financial support, sharp after a slow start. Pent up demand and the desire of business to off load existing stocks with create discounting which will attract buyers and keep pressure downward on inflation.

o        How long is the shock likely to last? – until Christmas, people will want relief from misery!

o        Which sectors are likely to be impacted by economic scarring? Retail – people are getting used to buying more online

o        Which sectors are doing best? Online retailers and associated transport and distribution

         What will be the economic impacts of the coronavirus outbreak and the social distancing measures in terms of sectors and regions and how temporary/permanent will they be? No comment

         What will be the impact on inequalities within society and how should the Government address inequalities that may have been exacerbated by the crisis? Those that have savings and lower debts have been better placed to manage but if you have saved more than £16,000 you get no support even if your income is £0. Is this policy called “punish the prudent ?” The long term solution is education about money which does not currently happen in the school curriculum. Inequality can only be addressed in the long term by education

         What will be the impact on the public finances?

o        What are the potential future implications for tax and spending? Taxes have to rise, everyone knows that, just come out and say it clearly, with an explanation and a strategy. Conversely spending has to fall. HS2 and Heathrow ? Really ? Massive cost and massive economic disruption

o        What are the implications for the Government’s “levelling up” agenda announced in the Budget/infrastructure strategy? Too big a topic to comment in short form

 


         What will be the impact of high levels of Government debt on market interest rates, private investment, capital formation and future productivity? Rates will be driven up. Government chasing debt providers and having to pay more. Private investment will always follow market opportunity and insolvency creates opportunity. The CV scenario has also created oppotyunity for productivity improvements from home working. But that will take time

         What has and will be the impact on global growth and what shape is the international recovery likely to take? No comment

o        Are there international examples of economic policymaking that we can use?

o        How is the UK Government co-ordinating with other governments to boost global growth?

o        How are countries coordinating their efforts to assist the global recovery?

         What will be the impact of the outbreak on the Government’s economic, customs and financial sector priorities in its negotiations with the European Union? No comment

         What are the differences and similarities between this shock and the Great Financial Recession of 2008 and also the economic demand management and demand suppression policies pursued during the Second World War? What lessons can be learnt from these past shocks and the recoveries that ensued? No comment

         What are the lessons that society can learn for the future e.g. reducing carbon emissions, increased home working, business resilience? The CV shock has produced massive environmental benefits and the potential to create permanent change to our travel and working patterns, with the accompanying benefits to the environment. Those changes will also affect quality of life and work/life balance for millions and properly managed by business, these will produce long term economic benefit. This opportunity should not be lost by the government. Introduce Air Travel tax after an annual allowance, measures to accelerate for electric aircraft engines, ban by statute, any packaging that is not recyclable with effect from 01-06-21. Legislation spurs innovation, industry won’t change without a legal push.

 

 

         Finally, let the government be upfront about the cost of Covid 19 and the need for taxes to rise. Clear communication with an explanation of the figures will gain the (grudging) support of the public. It’s not the message, it’s how it is delivered that wins support.

 

 

 

May 2020

 


 

 

 

Written evidence submitted anonymously

The forgotten Facts about me

asked to pay!

May 2020

 


 

 

Written evidence submitted anonymously

 

I am a current Postgraduate Architecture student at Oxford Brookes University.

 

Like many others I have been severely impacted by the Coronavirus pandemic and consider that I have a balanced understanding of the current situation. However, while I am receiving online tutorials I have no access to the essential, specialist facilities required for my course. Specifically no access to workshops and equipment (for example; laser cutters, large scale printing, CNC machinery, photography suite, 3D printing, specialist software). I am aware that our university has enabled students to have online access to their library however, for my Architecture Master’s I am severely disadvantaged in the work I can produce and this will impact on my future.

 

I have undertaken a student loan to cover tuition fees and access to these specialist facilities which I am no longer receiving. To qualify as an Architect I have a significant student debt and whilst I was prepared to face some hard ship in order to return to university for my Master’s I consider it wholly unfair if I am to pay the full amount of tuition fees for something I am not receiving.

 

Furthermore, I along with many other students, feel that the lack of a standardised response from all universities about ending accommodation contracts early, placed significant pressures and anxiety on students at a time when many are suffering financial hardship and trying to manage exams etc.

 

I don’t think it should be up to individual students to fight for their own case against their university to receive fair treatment and the service that we are paying for.

 

May 2020

 


 

 

 

Written evidence submitted anonymously

 

Dear The Treasury Committee,

I’ll keep this brief as I’m sure you’re overwhelmed with people crying for some help, especially those in Ltd Companies.

I run a cat sitting business and my income has reduced by 100% due to Coronavirus and lockdown. I feed people’s cats when they’re away, so clearly when no one is away then I don’t have any work. Last April I did about 500 visits at £12 per visit, this April was zero. Same so far for May.

The government’s offer of furlough for the PAYE element works out to about £550 per month, my basic living costs before spending anything on food are about £2,500 per month in mortgage, bills and child maintenance payments. I live on my own as I’m separated from my children’s mother, so my income is the only income. I am now at the point of starving myself as much as I can get away with, suffice it to say I’m trying to spend as little as possible.

That leaves a shortfall of approx. £2,000 per month, and I’ve used all my savings already – I’m not a fat cat, I’m a cat sitter who paid myself about £42,000 last year in PAYE and dividends.

I could take a mortgage holiday and I could take a bounce-back loan. The former would cost me in excess of £4,000 over the remaining term of my mortgage in additional interest, the latter would also cost me interest.

Why is there no help for Ltd Co. Directors? I know it was a conscious decision by the government, it’s a disgrace and won’t be forgotten by the couple of million of us who’ve been shafted. I’ll be tens of thousands in debt by the end of this, bankrupt.

 

 

May 2020

 


 

Written evidence submitted anonymously

 

I am a small business owner who has been left out of income support schemes and I urgently need help.

 

I run a small Limited Company, and am self-employed in all but name.

 

I started this company from scratch a decade ago, leaving the security of employment to create my own future.

 

I have worked hard and long for these 10 years to create a successful business. For the first few years I worked 80+ hour weeks.

I made my way through the 2008 financial crisis, and came out the other end.

 

My business generates over £50,000 a year in VAT, pays £10,000-20,000 in corporation tax, yet now when my turnover has dropped to virtually zero overnight, I am not eligible for any support

 

Had my business been established as a sole trader, I would be eligible for the SEISS scheme, and I would survive.

 

Now, I may not.

 

I have never been in debt, the company has never had a loan, nor even an overdraft.

 

I am asking for the Treasury to reverse this policy and put us on an equal footing with the self- employed.

 

That way my company will survive and I can continue to generate the money I do for Treasury/HMG

 

The alternative for me, is Universal Credit, which will not begin to cover my living costs and I will go bankrupt and everything that comes with that.

 

Losing my home is a real possibility

 

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees?

 

Please correct these flaws in the support scheme.

 

May 2020

 


 

Written evidence submitted anonymously

Background

We are a video production company based in […] that was formed by myself during the height of Brexit in 2018. The company's only member of staff is myself, the director. The company was growing and whilst didn’t turn over massive substantial amounts in the first two years (due to being new to area and not knowing any clients, and not having a showreel we could show due to being compliant with copyright, even though have over 2000 videos I have worked on in previous jobs), this year we were looking at turning over

£200,000 before Covid19. We were also looking to move into a premise and employ 4-5 people. Set up as a ltd, on advice of an accountant, and certain clients required us to be a limited company and also wanted to keep the company assets separate to personal assets. I take small salary as couldn’t guarantee when the company would have money to pay more, and take remaining personal income from dividends from the company - not through other investment sources.

Job Protection Scheme (JPS) / Self-employment income Support Scheme (SEiSS

As a limited company director, I can’t furlough myself, as I still need to answer customer enquiries, had a small amount of work in which whilst not as much income as the furlough payment, it is more important for the business in the long term. I think it’s more important to be able to carry on marketing for the future than to take a small payment of £550 from Furlough.

I am not eligible for the Seiss, but the contractors I have paid and helped increase their profits form work I have found for them have benefitted from this.

I find it outrageous that limited company directors have been paired with the words ‘tax dodgers and fraudulent’ including by MPs - and even by Rishi Sunak, when all I have done is act compliantly and legally. This is a deep blow when you see so many are able to be better off due to Covid 19. For example the self employed who had extra time to complete the self assessment - giving time to fiddle accounts to get the best from the grants offered. Also have heard of employed staff who this year took a pay cut but because furlough is based on last 3 years salaries are actually now on a higher wage on furlough. It is also hard to swallow that I can’t get any help or if I furlough I can’t carry on working yet the self employed (which I thought I was for many other government purposes, seemingly when it suits, and mortgage applications) can get a grant and carry on working. There is no fairness in the schemes. It

 


seems to me that the government was too generous, offering to pay everyone’s salary at 80% up to £2500, but forgot so many. The packages should have all been announced at same time, and maybe so no one was ‘left behind’. I can’t apply for a grant for a premises, as I have worked from coworking spaces and recently moved to work from home so I could save to employ staff and move into a premises.

There are many gaps not plugged including 2 million limited company directors who collectively employ 14 million people, many of these people will not have businesses to return to. It is not viable for either the JPS or SEISS to be carried on without supporting the directors of the companies/self employed with less than 1 year of accounts/ new employed starters are forgotten. There should have been a basic standard allowance for every adult based on age / living arrangements. This might have been less than the £2500 per month but it would have ensured that everyone is supported fairly. The government MUST prioritise the limited company directors NOW as leaving us to fall through the cracks will no doubt result in millions of unemployment and mental health related deaths. Offering loans is just a debt for many people who have worked hard day and night to offer support to so many employed staff. These directors are the backbone of the country, and not only that have been the ones to take risks in setting up a company, which ultimately will end up paying more in tax. (Whilst tax rates are slightly lower - I am sure the amount of corporation tax that is paid by every company is a considerable amount of total UK tax income, and also it is not to be forgotten that these companies have employed millions of people who have paid tax, without these entrepreneurs creating work, there would be a higher level of unemployment and less people paying other employment related taxes.

Support to businesses and Financial services

Whilst many have applied for CBILS and the Bounce back loan, this is not parity for the limited company directors, as others are effectively getting grants

/ free money. Debt is not the answer for many.

My business, if it can keep going, will help market many other businesses and charities to help them grow and bounce back organically.

My business has protected it’s freelancers, and clients by not filming over this period, but we will be more likely to film and be close to people, if we are not given the same financial support as many others. Many companies (like event providers) will not be able to bounce back, and return to work any time soon due to social distancing.

 


It is clear that the government did not plan for Covid19, and when it did start to act, only acted in haste, but not thoroughly thought out. This is why the UK has high death rates, and companies are crashing. I hope there is a thorough investigation in to the failings, and why so many other countries are out performing (with particular attention to how New Zealand have handled everything)

May 2020

 


 

Written evidence submitted anonymously

 

I am self employed person working in the live entertainment industry, particularly theatre, I help create costumes and bring designs to life.

I feel that the government has considered us up to a point. I am able to claim through the HMRC the financial aid for the allocated period but will it continue?

On a personal level, and as an industry, we need the continued support. Live theatre is, along with restaurants and cinemas, going to be the last area of employment able to open up after lockdown is relaxed. Having a socially distanced audience isn’t financially viable for most theatres and a vast amount of tickets are usually sold to tourists or group bookings of senior citizens none of whom are going to be buying tickets and rushing to the theatre any time soon. Without an audience there’s no income to create theatre.

No theatre means no work for me. I don’t have a spouse or partner I can look to for money to help me out in this situation, I am flying solo here as many of my peers are too.

Prior to lockdown a lot of us skilled professionals had work booked in until the end of the year and with those words “theatres must shutdown” in an instant we watched it all disappear with no idea where the next paycheque may come from or when we might see it.

Live events employees all have a wealth of valuable, transferable skills but many large companies and potential employers look at our cvs and aren’t interested, they don’t see that we’re highly organised, work efficiently, are strong and personable individuals, so it’s hard to find employment elsewhere and if the current financial assistance stops then we have nothing. Our bills can’t be paid, we may become homeless, mental health deteriorates, it’s leaving us in a very vulnerable position.

We probably won’t have any work until early 2021when it is rumoured that there’s a possibility theatre may be able to be staged again. Many small theatres will have gone into administration or closed completely by then, they won’t be able to reemploy their staff, and the time between then and now for everyone in my industry is looking very bleak indeed. I really think the government needs to look at extending the financial assistance for self employed and contracted workers in the live events category. We all want to get back to work as soon as it is safe to do so but if the theatre owners and producers can’t stage live theatre then we have no work to go to.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

I am writing to you to you to express my utmost dismay as to the totally inequitable manner that incorporated self-employed persons such as myself are being treated in the Government’s current business support package made available during the Coronavirus crisis.

I ask you, as my Member for Parliament, to review my letter and provide me with any support you are able to in getting this state of affairs a fair hearing by our Government.

Firstly, I would like to assure you that I am not complaining just “for the sake of it” or to make some ill-informed politically biased view. I understand that these are unprecedented times and I actually support the principle of the government’s general approach to the crisis, recognising the extent to which they have worked to provide support for businesses and workers. However, I have to report that the group which I am a part of, single entity self-employed who have a formed Limited Company, are not being treated with any sort of reasonable equanimity. I would like to take this opportunity to provide you with the reasons why I believe this to be the case.

First a little background to my circumstances:

Now, with regard to work opportunities:

Having explained my circumstance, I shall point out the lack if equanimity I feel applies by reference to the Governments response to the Petition: Coronavirus Support Package for Directors / Shareholders of small Limited Co's. I am making personal comments about my position, however I believe many of the points will apply to similar self-employed limited companies.

 


 

 

 

In the government’s response (email received 29th April 2020) to the petition it says (paraphrased):

(Note Government responses in standard text, my comments in bold italics).

 

  • Many of the measures in the package of measures to support public services, worked and businesses was specifically aimed at small companies.

 

I can only agree with this general statement.

  • Provision of 100% backed loan (interest free for 12 months).

 

My company has sufficient funds to “ride out” the next 6 months or so. Given the lack of clarity about the future for my company I am not prepared to build up any unnecessary debts.

Therefore. in my circumstances the loan offers me no advantage.

  • Small Business grant scheme relating to rates.

 

I work from home, so this is not applicable to me, so far as I understand.

  • Provision of Statutory Sick pay rebate.

 

Since I have had to furlough myself, I do not see that even if I were to get sick this is of any benefit to me.

  • Provision of SEISS for eligible self-employed: 80% of trading profits up to £2500 per month.

 

As a Limited Company this is not available to me. Herein lies some of the greatest inequities embedded in the Governments arrangements.

 

Had I been a sole trader I would probably have been able to claim £2500 per month

Not only that, I would have been able to continue trading (or working for now and for the future) without losing any of that income support.

  • States it is not possible to distinguish between dividends derived from an individual’s own company or those from other sources. Expanding the scope would require HMRC to collect and verify new information which would take longer to deliver and put at risk the other schemes which the government is committed to delivering as quickly as possible. Those self-employed who have Incorporated can furlough themselves and be eligible for 80% of their Salary.

 

I have furloughed myself and will receive around £500 per month because it is based on salary and does not take account of dividends.

 

Further, because the only option open to me was to furlough, I cannot do ANY work during the applicable time (aside from legally required company duties). This includes work for the future that will not even result in income during the crisis period.

 


 

 

 

Now for comparison the owner of company having one owner Director (the owner) and two employees, is, so far as I can see, able to put two workers on furlough, but continue to generate revenue by working themselves.

So, bearing in mind that my workstream has dried up, I am in a no win position when comparing myself to the benefits being provided to virtually every other stakeholder group. If I do any work, even it is minimal current support to clients or for the interests of the future of the company, I cannot claim any support. In contrast a sole trader with a similar general trading profile can not only claim significantly more support but can continue to work normally. That is generate normal income and receive support of around £2500 per month.

Some will argue that by forming as Limited Company I have paid less tax/national insurance than a comparable sole trader. I would address this by saying that my main motivation for forming a limited company was for company profile reasons, not to avoid paying taxes. I accept that I will have paid less tax and National Insurance as a Director of a limited company, so accept that I cannot draw a direct comparison between respective payments. But, to prevent me to do any work for the future or limited work right now seems highly penal and frankly is jeopardising the future of the company. Should I fail to survive I may then become a future burden on the States resources.

I would propose the following to provide some element of equanimity the self-employed limited company:

I appreciate these are busy times for you and your colleagues, however I would ask you to give some consideration to the case I have made and take whatever action you can to support my case.

I look forward to your response.

May 2020

 


 

 

Written evidence submitted anonymously

 

Job Protection Scheme and Self-employment Support Scheme

 

My consultancy works to help start-ups and SME’s survive, thrive and scale creating more tax revenues for the Government and employment opportunities.

 

As all of our clients were in the hospitality/creative sectors our income ceased when full lockdown started.

 

We do not qualify for JPS or SEISS. As an administrative aid we take our remuneration in Dividends. Consequently, we do not qualify for SEISS. We have no premises and obviously cannot furlough ourselves as our income is deemed to be nil. Our profits over the past 5 years have never breached £50k. After a serious illness a few years ago my wife took her small pension as an annuity, consequently the amount available to us via U/C would be

£34.51 per month in total.

 

The actual benefit to us financially in taking dividend remuneration when it is available to be taken is, after all other taxes are taken into consideration, just over £12 a week. This is more than eaten up by the admin costs of being registered as a Limited Company. We have no investment Dividend income. So, paying ourselves via dividends actually costs us money, but saves us a lot of time.

 

I have no access to any Government schemes unless I apply for a Bounce Back Loan which will put a lot of debt onto my balance sheet. As I am one of the registered ‘extremely vulnerable’ I am loathe to access this money as I have no clear indication when I will be able to leave my house and work again. It might be years. My accountant has advised that unlike the SEISS and furlough schemes this money cannot be used to keep body and soul together and it seems that if the money is used for anything other than the specified uses the tax applied will be somewhere between 7.5 and 32.5%.

 

From what I know all the Government schemes are based on a claim being made and HMRC clawback being enshrined if incorrect claims are made, as with annual accounts. Apart from the part/whole self-Dividend paying small business owners who seem to be not trusted to do this and are consequently excluded from the help given to their employees (furlough) and the other self-employed (SEISS). There has been much publicity around this matter, and it seems a tiny proportion of the excluded get investment income. And of those that do the average annual revenue seems to be around £30.

 

Despite a huge campaign to raise the issue of this exclusion, the Government’s position remains that we are not to be trusted, are tax dodging fraudsters despite all cash benefit for smaller businesses being reduced over the years so that, as for me, the only benefit is admin simplicity in a highly variable income business.

 

It is clear (to me anyway) that the failure to treat people like me equally will inevitably result in thousands of business failures and millions of job losses as owners give up and make their furloughed staff redundant. The SEISS offers 3 months at a MAXIMUM of £2500 a month,

 


 

which, in the context of the scale of the business closures and forthcoming redundancies to come, feels like an achingly small amount to pay given the amount of largesse given to multi-billion pound businesses. The Chancellor could, by allowing people like me into the SEISS, with personal and accountant certified statement of any investment income, save a swathe of hard fought for small businesses and the jobs of millions of people.

 

I feel that the above suggestion is actually the biggest ‘bang for its bucks’ the Chancellor could get. I don’t understand why this (clearly) Treasury totemic issue around dividends is being allowed to wipe out the very businesses we hear are going to be needed to drive the economy out of depression and re-build the tax base of the economy.

 

Support to businesses and Financial services

 

None of the major finance schemes are applicable to me as a small business owner (<£50k profits).

 

I did, in the early days discuss the blizzard of schemes that came out ,but my accountant and bank stated I wouldn’t be eligible for any of them.

 

Other government intervention

 

It feels that our excellent military could have been used more and earlier.

 

The Government has intervened at an unprecedented level. The disappointment is that, people like me - and there are maybe 2 million of us -who play by the rules, pay our taxes – dividend/PAYE/Corporation – have been the ones to have been made some sort of example of for using a HMRC approved scheme that doesn’t really save us any money any more.

We’re not Philip Green – we make <£50k profits!

 

Economy, public finances and monetary policy

 

My main observation business – wise is that the policy of excluding small business Directors from support at this time will mean that a section of todays business base will not be around to take up the slack. This will affect the capacity of parts of the economy to start quickly and the inevitable huge amount of redundant people will be a drain on the public finances for more time that is actually necessary. Their jobs can be saved as detailed above. The hardworking entrepreneurs are unlikely to return to ‘business’ after this treatment.

Many feel that the Government is creating a hostile environment for entrepreneurs and small businesses. If my business fails I won’t work for myself again. The Government needs to consider whether they are actually going to have schemes to encourage new start-ups. It is hard enough to get a business off the grounds now. Long hours, stress and often having to put the family home up as collateral to access finance. Many are now thinking, given the hostile environment evolving, why would you bother? Increasingly many feel that’s a fair question.

 

Elements of the economy should recover quickly – construction, transport, manufacturing but the economy is going to have some heavy lifting to do to support the unemployed, both

 


 

the unavoidable and avoidable. That’s an awful lot of avoidable spending power taken out of the economy on the back of a Treasury Totem.

 

Inequalities. Nearly 60% of the business of serious risk of failing due to the lack of support are female owned ad run. In addition there is, particularly in FMCG, a preponderance of BAME entrepreneurs. This will cause the Government serious presentational issue as the reviews of actions taken in this pandemic take place. Not a good look to be discriminating against women and the AME community at any time.

 

I feel that there will be a surge to home-working initially but that will crumble relatively quickly owing to both employer concern over productivity in non IT sectors and worker loneliness.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

I would like to thank the Treasury Select Committee for pushing the government on the ‘hard edges’ of the various Coronavirus support packages that have been introduced so far.

 

I’ll start my evidence submission with a summary of my business and the economic impact that Coronavirus has had on it, followed by:

 

 

My Business and the economic impact of Coronavirus

I work as a designer in the book publishing industry. The spring and summer are usually one of my busiest periods – always a big push to get books off to the printers for the high value autumn and Christmas markets – but this year my work had completely dried up by the end of February. The knock-on effect, not just of bookshop closures but also shutdowns of book wholesalers, warehousing and distribution, is already impacting publishing schedules and, thus, everyone else along the supply chain. This impact will be long-term. Although, work does continue in the industry, publishing programmes are being re-jigged and scaled back – in the present, new titles can’t be marketed or sold effectively; over the coming months publishers can’t risk over-saturating the market with new books once restrictions ease.

 

As a timely illustration of the impact on the publishing industry, The Bookseller reports today (7 May) that small independent publishers fear being ‘wiped out’ by September (https://www.thebookseller.com/news/small-presses-fear-being-wiped-out-autumn- 1202281?utm_source=Adestra&utm_medium=email&utm_term=&utm_content=&utm_campaign= Morning%20Briefing%20-%20070520). These are Small Limited Companies like myself who are falling through the cracks of support. Small businesses that provide work for so many freelancers: editors, proof-readers, indexers and designers … my client base includes small Indie presses as well as larger publishers. In recent years print sales have up year on year, more indie bookshops opening but now, across the board, there are fears of print sales being down 75%.

 

My business is a good example of the lack of parity between how Small Limited Company Directors and self-employed sole traders are currently being treated. I set up as a limited company primarily because of the protection offered by the limited liability. But many of my friends doing the same job as me are self-employed sole-traders. We work for the same clients, have similar incomes (and publishing is not an especially highly-paid industry) and similar ongoing costs. Yet I, having furloughed myself, can claim support for only 80% of my small PAYE, with my dividends – ¾ of my usual income – excluded, while they could claim 80% of their total income; I am only permitted to file accounts and other legally required reporting, while my self-employed friends can continue seeking and accepting work offered.

 

My company’s income fluctuates throughout the year because the majority of the projects I’m working on at any one time run over several months. So I pay myself a small monthly PAYE salary then take dividend income when my trading profits allow. This is no different from my self-employed

 

 

 

1

 


 

sole-trader colleagues in the industry. They also receive their income once their invoices have been paid. It just has a different name.

 

I’ve successfully run my business for 17 years, without ever needing any loans, and making enough profit to give me a modest but sufficient income. If it weren’t for this crisis I would have expected to continue doing so this year too, and for the next 20 years.

 

The Chancellor talks about sustainability, and comparing the costs of the various support packages with what is being spent on the NHS. But if small businesses don’t survive there will be far less tax revenue, not just from small business owners but also the millions of people they employ, to spend on the NHS, not to mention the very increased benefits bill that will result.

 

 

DWP response on support available to Small Limited Company Directors

5 May, Therese Coffey’s response to Rob Butler (on what can DWP do to help owner/directors of small limited companies): “small business owners who have set up their companies in particular ways, I’m sure well advised by accountants at the time on an optimal way to do that … [SEISS] is expected to cover 95% of people who receive the majority of their income from self-employment. But if not, then I would recommend that those other people do look online at their potential eligibility for Universal Credit”

 

 

 

Evidence Session 29 April

I watched the Treasury Committee Evidence Session on 29 April, and downloaded the transcript a couple of days later. Rather disappointed that Stephen Barclay, Beth Russell and Katherine Braddock failed to answer so many of your questions adequately, but I’d like to pick up on three responses in particular from Beth Russell and Stephen Barclay, relating to Dividend Income and Small Business Grants:

 

From Beth Russell (on Dividend Income): “There is both a fraud risk and an error risk, because it is difficult for some people to work out themselves what dividends relate to their business versus other dividend income they might have.”

 

 

 

 

2

 


 

From Beth Russell (on looking at proposals for ‘pay now, claw back later’): “we do not have information on these people …”

 

From Stephen Barclay (on Small Business Grants being linked to SBRR): “Part of the reason for linking it to property is that property is a significant fixed cost of business.”

 

 

The hard edges for Small Limited Company Directors

 

Government Support Checklist:

 

I am a #ForgottenLTD https://www.facebook.com/ForgottenLtd/

https://twitter.com/hashtag/forgottenLTD?src=hashtag_click&f=live

 

 

Chancellor’s response to the Treasury Select Committee (published 21 April 2020)

The Chancellor’s letter to the Select Committee, dated 20 April, made for depressing reading. Mainly because he failed to answer the majority of questions posed by the Committee, but also there were a few standout comments that really felt like a slap in the face.

£16,000 in savings “In such cases, it is likely that they have alternative means of financial support” and assessing “total household income to ensure welfare supports those most in need who do not have access to additional financial assistance” Neither the CJRS for standard employees nor the SEISS is means-tested. As the committee pointed out there should be a level-playing field.

 


1 I note that the Small Business Grant fund had been topped up (2 May) to cover those in shared workspaces. However, it is discretionary.

 

3

 


 

 

Chancellor’s apparent view on Dividend income

To quote Andy Chamberlain from IPSE: “There was absolutely no way he was going to consider 'replacing' dividend income in the same way as he has 'replaced' earned income. He says dividends are primarily a return on investments. We argued, he firmly rejected the point” (https://twitter.com/AndyIPSE/status/1243460876507713536)

 

The truth is the dividends that small limited company directors pay themselves is a return on their labour. What we have invested in our companies is our hours of income-generating work. This is earned income, and completely different from dividend income from investing in the stockmarket.

 

 

Tax Avoidance Rhetoric

It doesn’t matter what term is used – efficiency, avoidance, evasion (I’ve heard from some quarters)

–  micro company directors paying themselves partly through dividends is neither tax avoidance nor tax evasion and isn’t especially efficient.

 

We pay:

 

         Corporation Tax

         Dividend Tax

         A higher proportion of VAT on our business costs because we can't benefit from the economies of scale that larger companies can

 

For an income up to £50k ‘tax advantages’ for a director paying small PAYE + dividends, rather than all PAYE are minimal.

 

We don't get:

 

         Sick Pay

         Holiday pay

         Redundancy pay

         Employer pension contributions

 

All this has to come out of our trading profits ie our Dividend payments. Plus accountancy fees for company accounts are a great deal higher than for Self Assessment Tax returns for the Self Employed.

 

 

 

4

 


 

Even if we paid ourselves PAYE above the Secondary NI Threshold – therefore, paying both employee and employer NI – we don't get equal eligibility to benefits from those contributions. Which is also the case for the self-employed who do pay NI, compared to employees.

 

 

My observations on the cracks in support and solutions to fill those cracks

 

Some key points that need to be address are:

         Small Limited Companies: Dividends income to be included in support scheme, so at least equivalent support as that for the Self-Employed

         Furloughed Sole-Directors: allow sole directors to continue working beyond just statutory duties

         Small Business Grants: eligibility for all small businesses, not just those that have premises with a rateable value, or work in shared workspaces

         SEISS: extend support to those who began Self-Employment after April 2019

         Bounce Back Loans: not an equitable alternative For more detail on these see below:

Small Limited Companies

Exclusion of Dividend Income

It seems to me that the government’s claim that the dividends income that sole-directors pay themselves couldn’t be included in the support offered because the tax system does not distinguish between such dividend income and dividends from other shareholdings, is rather a nonsense. There is a paper trail and, between HMRC and Companies House, the government already have all the necessary information:

 

1.       The Tax Schedules that are prepared by accountants (and submitted to HMRC) alongside the Self Assessment Tax return clearly itemise the source of all dividends income. So, in my case, the £50 or so dividend income I receive from the few shares I have can easily be distinguished from the dividend income from my own company. A simple calculation of the minimal PAYE and the dividends received from that same company (identified as my employer on my Self-Assessment) is all that should be needed.

2.       As well as Self-Assessment Tax Returns small company directors also have to submit Company Accounts and Company Tax Returns.

3.       Employer/Employee PAYE references will also evidence micro company structure

 

Surely it can’t be too hard to marry up these records in order to offer support equivalent to the SEISS package.

 

Solutions:

 

         If the government can design a simple form for Bounce Back Loan applications, it can’t be any harder to design one for our accountants to submit a claim for our dividend income.

         Base the support on 80% of a micro company’s profits before tax (average of 3 years from Company Tax Returns) + 80% of the PAYE salary, up to a £2500 a month threshold per company director. This will give parity with the SEISS grant (for sole-traders and LLPs) being based on Trading Profits and make it simpler for tax ie based on the same returns we already use.

         On the matter of fraud, our accountants already have to include a Return Declaration (which we as directors bear responsibility for, or otherwise face hefty penalties) on our Company

 

 

 

5

 


 

Tax Returns. Seems to work fine when HMRC are checking we’ve paid our Corporation Tax liability correctly.

 

Furloughing and Statutory Duties

Currently there is a huge inequity between the support offered to the Self-Employed and directors of Small Limited Companies who put themselves on furlough. The former can continue working to generate income, the latter cannot. There is also inconsistency in the guidance given on what duties furloughed director are permitted to do.

 

As the Institute of Directors has pointed out, the Government’s direction to HMRC (issued on 15 April) appears to restrict a furloughed director’s duties to filing accounts and similar legally required reporting, thus excluding tasks such as paying suppliers or administering the furloughing of other employees.

 

The example Martin Lewis (Money Saving Expert) gave of the conflicting answers he’d received from different government departments about permitted duties related to preparing advertising or marketing material for future work. One department said this would be permitted, the other not.

 

I would have thought, in both cases, such duties would fall under the Duty to promote the success of the company. In particular the points highlighted below:

 

(1) A director of a company must act in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to—

 

(a) the likely consequences of any decision in the long term, (b)the interests of the company's employees,

(c) the need to foster the company's business relationships with suppliers, customers and others,

 

(d) the impact of the company's operations on the community and the environment,

 

(e) the desirability of the company maintaining a reputation for high standards of business conduct, and

 

(f) the need to act fairly as between members of the company.

 

Will we be prosecuted for not performing the above statutory duties as laid out in law in the Companies Act 2006 …?

 

Ultimately small limited company directors should be able to receive support while still being able to perform duties that would generate income, whether in the future or on the basis of short-time working, as is the case with the Self-Employed.

 

 

 

 

 

 

 

 

 

 

6

 


 

Small Business Grants

Although the Business Secretary’s announcement on 2 May of additional Small Business Grant funding for businesses with ‘fixed property-related costs’ is welcome, worryingly, I note this funding is discretionary and not necessarily equal support: “local authorities will have discretion to make payments of any amount under £10,000.” It also still excludes many who’s ongoing fixed costs aren’t deemed ‘property-related’.

 

Small Business Grant funding needs to be extended to all small businesses. Both owner/directors and the self-employed have fixed ongoing business costs.

 

Bounce Back Loans

Although this addition to the available support packages is welcome for those small business that wouldn’t otherwise meet eligibility criteria for business lending, the Bounce Back Loans are not an equitable alternative to the grants that others are receiving. In the most extreme case the only support on offer for a sole-director is a loan they have no idea whether they be able to pay back.

 

 

 

Thank you again for keeping the pressure on. We Small Limited Company Directors have been forgotten. We have been left behind. If we don’t get parity of support now we will not be ‘all in this together’ to help the economy recover, nor will the millions of others that collectively we employ, and the economic impact of Coronavirus will be so much worse.

 

May 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7

 


 

 

Written evidence submitted anonymously

 

To the Treasury Committee,

 

I have been self-employed as a video editor for almost 18 months. I’m a new sole trader, still building up a book of contacts and finding my feet as a freelancer. This pandemic has hit me at a very vulnerable time, when work is not always consistent. Well-paying jobs have almost completely dried up because my contacts base and previous work portfolio was not strong enough to sustain the impact Covid-19 has had on the media and production industry.

 

I am not eligible for the government’s self-employed grant scheme. I have filed a tax return for the three months of the tax year 2018/2019 that I was trading, but the income from my freelance work counts for less than half of my earnings that year due to my previous full-time job, meaning I cannot claim any support during this time of massive uncertainty.

 

Other freelancers who are more established in their businesses than me, who are still able to find jobs through their extensive networks of contacts, are able to claim this grant, even if their earnings have only reduced slightly. They may even be better off than they were before Covid-19. The way the support system works is unjust, leaving out those who have recently gone freelance and are very vulnerable to business collapse during this time. We need this grant to stay afloat when work doesn’t come easy.

 

Why can we not use our 2019/2020 tax returns to prove our earnings as freelancers? The information is easily collected and filed. Why can we not be given a lower, base monthly total as compensation for the earnings we will be losing during the lockdown and beyond?

Something, anything to help us through this, instead of being completely shut out.

 

I currently am unable to claim much support on Universal credit because I am still receiving payments for old invoices. If I were eligible for the government’s grant, these payments would make no difference to the amount of money I would receive. How is this system fair to those who really need the support of the scheme to see them through the next few months? Particularly when others with higher incomes will be receiving thousands of pounds from the Government in lump sums.

 

I know of multiple self-employed people who for various reasons are set to lose out on financial help due to the current restrictions on who can apply for the grant. Please reassess the restrictions of your scheme, to include as many of the self-employed as possible, so nobody is left out on the support they desperately need.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

I became a self-employed copywriter in May 2019, after leaving my job of 15 years.

 

I was busy with work continually until March 2020, working on three consecutive contracts. When my final contract ended, I went on holiday for 2 weeks, arriving back on 22 March. Lockdown was imposed on 23 March and I have not had a day’s work since.

 

Because I became self employed in 2019, I have been excluded from the Self Employment Income Support Scheme. We are told we cannot submit our 2019/20 tax returns as proof of income, as HMRC cannot tell whether we are frauds or legitimate businesses. I find this reasoning illogical. Those who were late filing their 2018/29 returns were given extra time to submit theirs – if there was no risk of fraud with them, why should there be a risk of fraud with us? To save HMRC effort, honest workers are being punished – it’s immoral.

 

Universal Credit has been a non-starter, as my tax savings make me ineligible. When I queried this, I was told if I paid my tax bill I could submit an application. Yet I now need my tax savings to live on – I don’t know when I’m going to work again. Finding work is virtually impossible - no one is hiring freelancers when so many of their own employees are furloughed. The clients who previously used me are running only skeleton teams. There are barely any job openings on Linked In.

 

Until May 2019 I paid PAYE contributions for 25 years. I’ll be paying thousands more in January 2021. I’ve never claimed benefits. Yet in the biggest crisis we have ever known, I have not received a penny from the government in support. The uncertainty is having a crazy impact on my mental health. I’ve heard a lot of concern for the anxiety of furloughed workers, but none for the newly self- employed. We’ve been hung out to dry.

 

I believe newly self-employed people should be allowed to submit their 2019/20 tax returns as proof of income. We’re legitimate businesses who were registered as self-employed well before this crisis hit. We can supply enhanced evidence, if needed. Any support would be better late than never.

 

I’m extremely afraid that the government is going to keep extending the lockdown, keep supporting the people it has already helped, and keep ignoring those it hasn’t – like me. That may be the politically expedient thing, but no one involved in these decisions will ever be able to say it was the right thing.

 

May 2020

 


 

Written evidence submitted anonymously

 

May I please explain my circumstances as impacted by the Coronavirus and how government measures to date have failed to support myself and others in similar circumstances.

 

I am a sole trader, registered as self-employed for about ten years now. I am a freelance sports photographer supplying images to media agencies, newspapers, websites and magazines etc.

 

I last worked on March 10th and due to the lockdown do not currently expect to work again until August earliest, at best. As I would have to invoice and await payment from clients I do not expect to receive any income until October earliest. The likelihood is that I will undergo a minimum six month break in receipt of any income at all.

 

When the Chancellor announced support for the self-employed I personally breathed a huge sigh of relief because I knew my savings would not last through a six month period. I have until this week felt secure throughout this situation because of this and continued to pay all of my bills.

 

I do not qualify for Universal Credit, CBIL or any other support.

 

Now I have been informed that I do not qualify for SEISS support. The reason for this is because during the 2018/19 tax year I cashed in a personal pension. This money was used primarily to purchase new equipment for my business. This was a major investment for me, the equipment purchased would enable me to continue in my job for a period of five years. Because of this income, which was taxable, and the way I spent it, my non-trading income was higher than my trading profit for the SEISS assessment period and therefore disqualified me.

 

My accountant confirmed my ineligibility for this reason and informed me that I might aid my situation by applying for a Bounce Back Loan (BBL), which although this was repayable, as opposed to the SEISS grant, it would at least tide me through the period. I applied for a BBL and have been told I do not qualify. The reason I do not qualify is because the assessment period is the 2018/19 tax year and of course during that year my non-trading income was higher than my trading profits.

 

So I am now in a position where I do not qualify for any government support and the reason I don’t qualify is because I invested in my business.

 

As previously stated I cannot sustain this period without income so my only available option is to sell my equipment, therefore surrendering my ability to earn future income and closing my business.

 

How can this be right when others have received support without any qualifying requirement?

 

May 2020

 


 

Written evidence submitted anonymously

 

I am a lone trader, who started in August 2019. I work in the exhibition industry, which understandably has been shut down due to coronavirus and won’t recover for some time. I feel like I am one of the businesses that have slipped through the cracks for financial help.

As I am a start up I do not qualify for the Self employment Income Support Scheme. I also can’t get the Business Interruption Loan Scheme or Bounce Back Loan as I could get a “New business” Loan (at higher interest). I can’t get universal credit as between my husband and I we are just over the threshold in savings.

I have tried just getting a temp job to get in some money but as I’m needed to look after the children during the day (due to school closures) I am not flexible enough for them.

There are literally no options for me but to use our savings to pay the bills until the events industry recovers, which is very frustrating. Had we have spent our wages and not saved; we would be entitled to universal credit. It doesn’t make sense.

Ideally there would be a small grant available to help start up businesses like mine make it through this time, so that we are not forced to close shop before the industry recovers.

May 2020

 


 

Written evidence submitted anonymously

 

I am writing to you with regards to the Self-Employment Income Support Scheme (SEISS) which has been introduced to self-employed individuals who have been adversely affected by Covid-19.

 

I have a huge issue with this in that it is only available to those with trading profits of £50,000 or less.

 

1.       Why has this £50,000 cut-off amount been introduced, especially given that there is no such cut-off amount in the similar Job Retention Scheme for employees?

 

2.       It is highly unfair that someone with trading profits of £50,000 is able to use this scheme in full and receive a grant of up to £7,500, yet if your trading profits are £50,001 (only £1 more) or more then you are entitled to absolutely nothing under this scheme.

 

This is hugely discriminating against self-employed individuals with trading profits of above £50,000 who have been severely affected by covid-19, compared with employees and self-employed individuals with trading profits of £50,000 or less.

 

It is hugely unfair that a self-employed individual could receive no grant at all compared to a self- employed individual that has trading profits of £1 less and is entitled to a grant of up to £7,500.

 

It discriminates against individuals whose trading profits are above £50,000 and are correctly declaring all their self-employment income to HMRC compared to self-employed individuals that have trading profits in excess of £50,000 yet are declaring less than £50,000. This sends out all the wrong messages such as ‘it pays to cheat’.

 

Self-employed individuals with trading profits of over £50,000 may have lost their entire income due to covid-19, and may not have savings yet still have mouths to feed and have regular outgoings. The Universal Tax Credit offering is by no means a sufficient help, and is far less than the amounts offered by the SEISS.

 

I would therefore ask that the £50,000 cut-off amount for the SEISS is removed so that all Self Employed Individuals who are affected by Covid-19 are able to use it.

 

 

May 2020

 


 

Written evidence submitted anonymously

 

I work as a freelance Production Assistant in the film industry, predominantly in Advertising. Due to Covid 19 I have not been able to work and am very anxious I will not be working for quite some time.

 

I was under the impression I would be eligible for the Self Employment Income Support Scheme, however I recently found out that I am not - due to earning more in my full employment than I did with my self-employment for year 2018/2019, 2018 being the year I went freelance.

 

I am urging the government to look into the Self Employment Scheme Eligibility as I know so many people in the creative industries, like myself, who are falling short and are consequently really going to struggle.

 

I’ve now been self employed for 18 months, I’ve completed a tax return for 18/19, I earn less than the £50,000 cap, I do not have a Ltd company, I will be paying my advance tax payment for 19/20 in advance and I will be trading for the foreseeable future.

It seems unfair that I am unable to get help when I will need it most.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

To whom it may concern

 

This is to respond to the question as to whether the Government has successfully plugged the gaps in the job retention scheme, as well as to comment on its approach to detecting fraudulent claims.

 

 

I started a new job as an EFL Teacher at […], on a year’s renewable contract, on 2 March. When the country went into lockdown, the school had to close. It looks set to remain so until social-distancing in classrooms becomes viable, and until overseas students feel confident to attend classes in the UK.

As is normal practice in most salaried jobs, I was paid at the end of March with the RTI submission reaching HMRC just before this. Consequently, I am not eligible for the furlough scheme, despite still being, and wanting to be, employed. […] are also keen to keep me on.

I live alone, so my household is dependent solely on my salary. I have lost 100% of that. As I am employed, I am not eligible for Universal Credit. As to finding temporary work, unfortunately the jobs available at the moment are not advisable for someone with asthma. Mortgage holidays and rental help aside, I wonder what the government imagines I and others like me are living on.

I have emailed my local MP, the Treasury and the Prime Minister himself with regards to the Government’s oversight in not providing financial relief to me and the thousands of others in the same position as me. To date, only my local MP has responded, expressing the rather fatalistic attitude that these are unprecedented times, and that the Government is already helping millions of business and individuals, therefore it is unlikely to extend the furlough cut-off to accommodate us. The fact that millions are receiving help is great. However, this does not help us, nor does it justify ignoring our claims. He has now ceased responding to me. Currently, I feel powerless, dismissed and undervalued as a taxpayer.

On the issue of fraudulent claims, I am not aware of all the measures which have been put in place to detect these. However, I can comment on the preventative measure which has resulted in the Government refusing to budge from the 19 March cut-off date. This is overzealous and does not make sense to me. It should be very simple now for HMRC to see retrospectively who was genuinely employed, who paid tax and NI at the end of March. It should now be possible to include us on this scheme, rather than lumping us together with potential fraudsters.

The pandemic is by no means over, and its after-effects will be with us for some time to come. As a genuine new job starter, I do not feel it is unreasonable to request the same financial relief that the Government is affording to other employees. Even if it is just until June, at least this will provide some cushioning from the hard times to come.

Thank you for taking the time to consider my case.

May 2020

 


 

 

Written evidence submitted anonymously

 

I am a self-employed , classically trained singer, aged 61, and have worked as such since 1980. My work is almost all in live performances all over the world, with 80 – 100 concerts plus recordings. This is my personal story, but I know about an awful lot of others.

I believe I can claim the 80% of my profits for the last three years, and will find out later this month. However, this is only three months’ worth of money, and so far, all my free-lance work has been cancelled up to August, with most of the rest of this year looking precarious as well.

So far, I have lost somewhere between £10,500 and £14,000 worth of work due to the current situation, and my income in total from March to September looks like being less than £1,000. My calculation of what I will get from the Government scheme is about £4,000; I have just too much in savings to apply for more, but the fact is that as a singer I may be unable to work for the rest of this year, and possibly next year too.

There are many people in this situation. Singers, other musicians, all kinds of performers who cannot work if venues aren’t open. Will the Government let them all just slide into unemployment? Three months’ worth of money is not going to plug this gap. There needs to be some way to keep our performers in a state where they will be able to pick up and start again the minute circumstances allow. Many of us would be happy to do other things, to be useful (I’m currently volunteering for the NHS and helping with some online Church services), but given the general level of unemployment after this pandemic, people such as myself may find it very hard to start another career.

Working out a scheme whereby musicians, actors, dancers and singers can actually work and be paid seems important. Special studios where things can be properly recorded and sent out on-line to a paying audience? There’s plenty of free stuff out there, but we make virtually no money from our existing recordings being played on Spotify etc.

I know you have many other things to consider, but our country needs good music to still be there.

May 2020

 


 

Written evidence submitted anonymously

 

I am a British citizen, originally from Southampton in the UK, now living in New Zealand. I worked in europe for many years and payed taxes as well as private pension contributions. I am an independeant IT contractor and author of open source big data books.

 

The current virus situation may be solved by either drugs or vacinations within a year or two but I think that the economic impacts in my industry are going to be felt for decades. The current lockdown situation across the UK, New Zealand and many other countries has severely impacted my industry. I am an independant worker so I do not receive government handouts or grants when out of work.

 

I have been forward thinking about my financial future in the fact that I have both savings and pension plans. However, my savings will not last for years and tax laws in the UK stop me from accessing my private pension funds in times of crisis.

 

My question to the UK government representatives is this.

 

When my savings finally run out would they support people like me accessing my private pension funds or would they prefer that I queue in free soup kitchens. I ask this not to be provocative but because I am monitoring just this kind of situation in Thailand now. My savings cannot last forever and so I believe that tax rules must be adjusted in the short term so that people do not end up in a desperate situation. This also avoids the need for government support.

 

I will provide my details below but please keep my name confidential as I would be embarrassed if my family, friends or peers were to realise my situation.

 

May 2020

 


 

 

Written evidence submitted anonymously

I would just like to give feedback on how I feel the Ltd companies have been treated in this current time die to Covid 19.

My husband has been self employed for 13 years, the last 3 of which he has been registered as Ltd. This was upon advice from a few various people such as his accountant, insurers ( due to his work) & also companies he did work for wanted him to be Ltd.

We have been labelled tax Dodgers by the government which I find extremely disrespectful & discriminatory. Since 2016 the way in which tax was paid for Ltd companies has changed dramatically & was brought into line with standard rates. If you look at the charts out there the difference between self employed / employed & ltd is now minuscule. The difference is about £500 a year. I’m my opinion that isn’t us “having it easy" and makes us just as entitled to help from the government as everyone else that has been given it.

Yes the government have given Ltd companies help but there are way too many cracks in their schemes and all we want is parity. For example:-

1.      Furlough – we have decided against this as if you are a Ltd director you can’t do any work to generate income. This essentially means leaving your business slowly wilt and not having anything to go back to when this is over.

2.      Grant’s- Many of us don’t qualify for Grant’s as we either work from home or via Van’s. Yet the self employed have received a grant AND still allowed to work.

3.      BBL – To many this is the only option for them at this time but taking on debt / more debt at this time when the situation is so unknown is crazy. These cannot help out personally either or to buy assets with.

My husband work has been affected dramatically due to restrictions allowing him into peoples properties. He runs a solid fuel installation / property maintenance business. Small businesses have always been the back bone of the economy & by not helping with Grant’s these will crumble and leave such a big hole.

We feel that everyone else has been given help but Ltd companies aren’t worth receiving any.

Without help these business will end up folding which will in turn lead to many more people becoming unemployed. Its all well and good the government paying their wages under the JRS but if you don’t help the actual business then I see that as a waste if money as their jobs haven’t been saved they’ve just been prolonged for a few months.

 

 

Ltd companies need your help now please. We don’t want to be furloughed and leave our business crumble, we don’t want to be left with loans hanging over us if business doesn’t pick up, universal credit isn’t available to majority if their spouse is receiving a wage under JRS.

 


 

When we go for bank loans or mortgages we are classed as self employed. Even when you apply for Universal Credit they class a Ltd director as self employed! Our dividends are classed as earnings which is the case in every situation apart from yours now.

 

 

Even if you were to just offer a grant to all instead of drafting up a scheme to include dividends, we just want some sort of parity. We are not baddies who are doing something underhand and illegal. Everything we do & how we run our businesses is 100% legal.

 

 

So please, before it is too late for many, please help with Grant’s so people like me can keep a roof over my families head, food on the table for my children, money in my account whilst I can’t work to pay Bill’s. This is through no fault of our own and we need our government to help before mental health is adversely affected.

 

 

As stated by Rishi & Boris on one of the first statements “no one will be left behind" “we will make sure everyone has an arm around them".

 

 

#forgottenLTD need your help now and stop being discriminated against.

 

 

May 2020

 

 

Regards

 

 

Morris

 


 

Written evidence submitted anonymously

 

 

 

Subject:

 

Impact of government economic interventions on sole directors of limited companies without premises

 

Summary of key points:

 

1)   Many limited company directors are not incorporated by choice, rather because of procurement rules imposed by government agencies, e.g. NHS;

 

2)   The lack of support for these directors, who otherwise would be ‘self employed’ as sole traders, is causing severe financial hardship and means many will be unable to withstand the economic hardship during recovery;

 

3)   There are potential alternative ways of overcoming the ‘disaggregation of dividends’ issue, including potentially offering corporation tax rebates to solve the issue; and

 

4)   The unequal support for sole trader competitors is potentially anti-competitive and will further drive micro limited companies out of business.

 

Evidence submission:

 

I write as a sole director of a micro limited company, offering bid writing, graphic design and business support for charities and public sector organisations in the health and social care and education sectors. I have been undertaking this work for approximately 20 years. I earn a very modest amount from my work.

 

 

 

 

 

Page 1

 


 

The specialist services I offer are often lacking within those organisations and without the support in bid writing and tendering, many would not be able to secure the funding necessary to deliver services to the most vulnerable in society.

 

The work normally undertaken by my business, and others like mine, dried up overnight upon the announcement of the coronavirus measures. Many of the commissioning organisations, such as Local Authorities and the NHS, have, perfectly understandably, diverted their efforts from day-to-day procurement to frontline coronavirus-related work. Many contracts due for renewal have been extended to enable a re- focusing of commissioner efforts on other things. This is, of course, the right thing to do. Health comes first and this is a national emergency. But our clients do not, for the time being at least, need our services.

 

Thus, for me and many fellow businesses in the same situation, the sudden lack of work has caused financial difficulty, despite a significant level of ‘rainy day planning’. Compounding this are the ‘gaps’ and anomalies in the government support measures that have brought to the fore a number of issues forming the content of this evidence:

 

1)                Obliged by government policy to become a limited company, rather than choosing to do so

 

For many years, I operated as a sole trader and was happy to do so. However, when I was asked to support a local NHS service with procurement advice, I was informed that I would need to work under the banner of a limited company. NHS procurement rules, stipulated by government, prohibited the use of sole traders. Even though the administrative and time burden

 

 

 

 

 

 

Page 2

 


of becoming a limited company was significant, I had no alternative but to comply or refuse the work.

 

I am aware of other companies in a similar position. Many clients, including some of the larger ones within the third sector, have followed the lead of the government agencies and decided to only use limited companies as sub-contractors, stating this assists their ‘due diligence’ processes.

 

Whilst there is much coverage of the tax benefits ‘enjoyed’ by limited company directors, my own experience has been that these modest benefits have been offset by the increased costs of running the limited company in terms of accountancy, fees, administrative costs etc. These are inescapable as a director of a limited company and are not faced by a sole trader. To be clear, I would much rather be a sole trader. But the government agency rules have placed me in a position where I have had to set up the company and take on the administrative burden that goes with this.

 

This existing burden is now compounded by the lack of comparable financial support offered during this critical time.

 

Maybe it is time for the government to consider reversing this policy so that businesses like mine can return to sole trader status whilst still providing vital services to government agencies?

 

2)                Financial hardship

 

As a result of the Treasury’s decision to exclude limited company directors without premises from the business grant schemes and also from the self-employed scheme, SEISS, many people operating under my (government-enforced)

 

 

 

 

 

 

Page 3

 


business structure are at a significant disadvantage and struggling to make ends meet.

 

Many, like myself, pay ourselves using a mixture of both PAYE and dividends. My earnings are very irregular. Therefore I only take the majority of my earnings when I know that there is profit available, normally at the end of the financial year. All earnings are declared both through the self assessment and the company accounts. There is a clear trail showing the dividends taken, declared to Companies House.

 

Those dividends are already used by HMRC to calculate personal taxation and to adjust PAYE tax codes. There is, therefore, already a direct link with PAYE. This often results in an adjustment to the PAYE code, as I have seen this year, in line with the advanced payment on account payments made. (Incidentally, I shall have to wait until the next tax year for any due refund on this, having now paid tax twice-over in advance for this current tax year, both through the tax code system AND self assessment – something I would never have had to do as a sole trader, or as an employee before that). But the point is – HMRC are already using my dividends to affect my PAYE, yet for the purposes of the Job Retention Scheme, they are deemed irrelevant and excluded. Is this not a double-standard?

 

This means that any claim under the Job Retention Scheme can only be based on PAYE earnings. This is small and does not cover monthly outgoings – although it is nevertheless very welcome.

 

3)                Alternative ways of dealing with the problem

 

I understand the point made that it is difficult for the Treasury to disaggregate dividends earned in a ’self employed’ capacity, from those earned by individuals with passive share

 

 

 

 

 

Page 4

 


portfolio. Whilst I do not fully accept that it is so difficult to obtain the information, and I certainly feel the ‘claw back’ system, with stiff penalties for false declarations, would be a very workable solution, I do have some sympathy for  the  Treasury’s thinking. However, I also wonder whether there are other solutions.

 

Therefore, rather than focusing on dividends, I wonder if it might be worth asking the Treasury to consider something that focuses more directly on the Corporation Tax calculation that would have released the dividends in the first place, rather than on the cover-all ‘dividend’ submission on the self assessment form, given that both are fundamentally linked?

 

For example:

 

 

 

 

 

 

 

 

 

Page 5

 


 

 

         As all dividends are inherently linked to corporation tax, given they can only be paid on any profits after tax has been paid, the reduction in tax payable would be a reflection of earnings;

 

 

 

 

 

 

Any such system would eliminate any issue about identifying the source of the dividend income, as it is directly linked to earnings through the limited company. It would also provide small

 

 

 

 

 

Page 6

 


businesses with the freedom to release set-aside funds immediately in anticipation of the rebate - and direct the funds to where they are most needed, whether that be Director salary for those not receiving any other salary help, or business resilience-building if the director felt that were more appropriate. This would be a great relief to many people anxious about the on-going viability of their business.

 

 

4)                Anti-competitive interventions

My final point relates to the ‘recovery phase’ of the current crisis and the impact of the disparity of government intervention on competition.

At present, the absence of grant-support or a comparable income support package means that the only option for many sole director businesses is to apply for a ‘Bounce Back’ Loan. This obviously involves placing the business in debt. This will not be the case for our sole trader competitors, or those businesses with premises, who will have received non- repayable grants.

 

As we move forward, we will all be bidding for the same work. When bidding for this work, our pricing will of course have to cover the newly-acquired debt overhead; our competitors’ pricing will not.

 

Likewise, if we are forced to furlough as Directors, we are not permitted to undertaken any income-generating activity for the company. However, our sole trader competitors can continue to work. This will include maintaining and nurturing customer relationships. Again, this rule will ensure competitors have an in-built competitive advantage when the emergency is over. Could not an exception be made for limited company directors to be able to continue an element of work, not least to prospect

 

 

 

 

 

Page 7

 


for potential work at the end of the crisis in order to better hit- the-ground running?

 

As it stands, even if we can keep our heads above water during the period of shutdown, we may find ourselves subsequently defeated by the government’s unequal subsidizing and treatment of our direct competitors. This feels very unfair and would be worthy of some exploration by the Committee?

 

In submitting this evidence, I would like to recognise that this is not an easy situation for any government. Few of us would want to have to make these life and death decisions. It is a national emergency. The help provided to so many people will be very much welcomed. But there are gaps. And in order to rebuild after the emergency passes, the government will need the help of ALL individuals and businesses to recover. If we are left behind, or worse still go to the wall, then a significant national resource will be lost… and that will cost far more in the longer term than the short-term investment required now.

 

May 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Page 8

 


 

Written evidence submitted anonymously

 

I am a director of a small business, a tea room, gift shop and visitor information centre, which has been severely impacted by the Coronavirus pandemic. I own a tea room which was forced to close suddenly losing all revenue overnight. As a tourism related business this could not have come at a worst time, we lost our single biggest trading day of the year, Mother’s Day and then all of Easter holiday trade to start with. To put this into context we generally trade at either a loss or break even during the winter from November to March, during this time we cannot afford to take any personal income from the business and therefore look forward to Easter to be able to do so after several lean months.

 

The CJRS was welcomed to help support our staff, we were to have made redundancies and this scheme helped to prevent this. We are now having to reconsider this as the fact that employees are still accruing paid holiday entitlement during this period of furlough will be a cost burden that we can ill afford if we survive through this as a business. It is most likely that trade will be radically reduced when we reopen and so costs and particularly significant staff costs will have to be reduced pro rata.

 

It was a startling discovery to find out that we as business owners were not covered for the majority of our own personal income by this scheme. When the first furlough claim came through we paid thousands of pounds over to our team and had little for ourselves. We had all the stress and huge anxiety of sorting out drastic measures to help our business to survive, agreeing payment plans for our outstanding liabilities and basically putting our tea room into mothballs after 11 years of trading.

 

Government support schemes covered those in employment through PAYE and the self employed but not us as directors of a small business. We received a cash grant for the business because of our rateable value and this was passed on to suppliers, pay utilities bills and our landlord, it was not for our personal income and not to be used as such. We were told we could take out a loan, we never incurred any debts in starting the business but we were told we should do this, very different to what employees and self employed were being told, why are we different.

 

We took the majority of our income through dividends after we had paid corporation tax on profit. We abided by the rules set by government and were advised to do so by our accountant, so we did fully and properly. We are not wealthy, we earned routinely £40-50,000 a year, yet we now feel tarnished as though we have been tax dodging billionaires.

 

There were reports of large organisations jumping on the furlough bandwagon using it to decrease their payroll bills, of companies profiteering from such, and yet we couldn’t even cover our own personal income. A 17 year old girl who worked part time for us at the weekend whilst still at school had £160 in furlough pay and yet my husband received not a penny. How unfair is this?

 

We are trying to plan to reopen if we survive the period of closure. We have compiled cash flow projections several times over. It looks likely that our turnover will be decimated due to necessary social distancing measures and the look and feel of our business will change dramatically. Visitor numbers will be severely affected from both the U.K. and abroad. Our ability to service customers or accommodate them as seated customers will hugely impact on sales per head. It looks as though consumer confidence may mean that we operate a more takeaway style operation with lower spend per head anticipated also, a double whammy. We therefore will have much less revenue yet we will be expected to pay the same costs for our rent, business rates, electricity   etc              will our suppliers want to reduce their costs to us to share the load, we doubt it.

 

We also have additional costs before we open which include social distancing instructional signage, investment in procuring takeaway disposables such as coffee cups and food wrapping materials. Things like hand sanitizer gels and dispensers which we also need have tripled in price. We will also need acrylic sneeze screens for the till areas and new fully covered cake cabinets for display. We anticipate all these additional costs will amount to around £7000, something we can ill afford with no revenue since March.

 


 

And then the dilemma of the prospect of not being able to start to trade again until the autumn, missing out on our profitable months. It will be extremely difficult to survive as a business if we have no interim support during this period. Things like deferring VAT, NI or things like corporation tax will not help us, they merely postpone debts that still have to be paid. Not being liable for business rates will only save us £5500 this year and £22000 next year. We will need assistance with a phased furlough scheme as we test the water with staff costs to see what sales there will be to sustain our staff costs.

 

The impact on our personal income will be right through to when we are able to go into profit again, if we have no profit there are no dividends for us to take. After a significant period of time from March of this year with no personal income it continues to be a crisis for us. We had built a successful business through many years of hard work and we are expected to be the only sector in employment that are expected to go into debt to get out of this. I simply ask why is this? Please do not let anyone to say the system will not allow this, it is simply not true.

 

May 2020

 


 

Written evidence submitted anonymously

 

My name is […] and I am the sole director of my limited company […] which offers marketing and brand management services to businesses ranging from start ups and not-for-profits, to larger retailers and agencies. It's been almost two years since setting up my business and I've grafted hard to build up my client base and work hard for my clients with hope of growing my one woman limited company in the near future.

 

I am now in a awful position as I am not eligible to any government income support and all my contracts came to an end in March due to the Coronavirus outbreak. A long with many other limited company directors, we are all incredibly scared, confused and angry. We do not deserve to be left with nothing, and are being penalised for setting up our businesses in line with what our accountants and the governments have laid out for us.

 

And whilst all we are hearing is that it is 'too difficult' to calculate support for Ltd directors who pay themselves mainly in dividends, myself and many others will be unable to continue their businesses and as a result will fail within the next few months without any support from our government. We have proof our tax returns, company numbers and the majority of us don't have shareholders, so the decision to completely leave us out of any income support is crippling for our futures as entrepreneurs.

 

Many of us don’t qualify for small business grants as we’re not in commercial premises. Taking on debt to support our livelihoods isn’t an option. Without rapid assistance, many of us will go under – costing jobs today and crucially those we could have created in the future.

 

We are calling on the government to immediately:

 

  1. Allow furloughed directors to continue to work

 

No one should be forced to abandon their businesses, nor punished for unwittingly undertaking any action that may be deemed fraudulent. We need to be in the strongest position possible to emerge from this crisis intact and to play our part in the country’s economic recovery

 

  1. Extend Business Support Grants to all small businesses We need support now to save and sustain our businesses
  2. Protect our incomes by extending SEISS to encompass small limited company directors

 

  1. To include PAYE (except where already furloughed), dividends and/or income classed as repayments to a director's loan for companies not in profit

 

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees?

 

 

May 2020

 


 

Written evidence submitted anonymously

 

Support Needed for Small Ltd Companies

 

I wish to provide evidence to show that small Limited companies have been left out of the Government rescue packages to business through the Covid 19 crisis.

 

Myself and my business partner Helen Scott are both joint founders of a small ltd events business called […]. We put on Music, film and media events for large media companies who require us to be VAT registered for trading purposes, including public liabilities, and to manage all suppliers through our business on their behalf.

 

We are both working mums with families to feed. All of our events cancelled from Mid-March and until at least the end of the year. We will be the last sector up and running as and when we return to our new normal.

 

We pay ourselves a small PAYE amount of circa £700 and make up that amount monthly with dividends of £2300. We pay tax on both personal tax and corporation tax as well as VAT returns. We also have to pay our own insurances, accountancy fees and do not have holiday or sickness pay. We also employ a regular team of freelancers and other small business suppliers. We also commission caterers, photographers, designers, staging and crew suppliers.

 

We have been forgotten by the government. If we furlough ourselves, 80% of £700 is not enough to help with bills and outgoings. Our dividends (which we are taxed on) should be counted. Our company is […]. We have been trading for over 3 years.

 

I ask that you consider the following measures – in particular for companies within those sectors who will be the last to return to work:

 

1)  Allowing furloughed directors to continue to work to support their businesses

2)  Extending Business Support Grants to all small businesses

 

Please, please reconsider your measures to support small businesses like mine.

 

May 2020

 


 

Written evidence submitted anonymously

 

 

Small Limited Company Directors Excluded from Government Support – Covid-19 Crisis

 

We started our small but successful ballet business in 2003. […]

 

We import ballet shoes and accessories and distribute to dance retailers around the UK. We work extremely hard, have sacrificed a lot over the years, enjoy great relationships with our customers, and are very proud of what we have achieved, and the contribution we have made to the economy. We are 2 directors, and we employ 2 staff. The business has grown steadily over these 16+ years.

After some quite significant loss of margin over the last 3 years (exchange rates losses around Brexit) and loss of a major supplier, in January and February, our business was showing good growth again.

 

On 16 March, all orders from our dance store customers dried up overnight, as ballet classes around the country had ceased, and nobody was needing kit. It is unlikely to get going again until schools and ballet classes recommence. We therefore have virtually no income and no prospect of income until then. This is causing untold stress on our family.

 

Our business is our only source of income to pay for our mortgage, household bills, university accommodation, and food to keep our family. We pay ourselves through a mixture of salary and dividends .The Job Retention Scheme has been very helpful for our two employees, and the small business grant has been invaluable in paying rent and some of our supplier bills, (we thank you very much) but my husband and I find ourselves with only £550 for our whole family to live on.

 

I simply cannot furlough myself as it is my responsibility to keep the business alive and prepared to grow again and contribute to the economy. We have taken the impractical decision to furlough my husband, but as director, he is only entitled to 80% of his PAYE = £550 per month, and frankly we need him working on other back office tasks. We cannot understand why the government cannot take our dividends into account as part of our earnings and allow him to claim up to £2500 a month. (which would still not be enough for a family to live on but would help). So, we are having to extract every last penny out of the business to survive.

 

The only other option we have is a loan, which is not a viable or responsible option in uncertain trading circumstances. All we ask for is parity with other tax-paying members of the public and parity with the self-employed who can receive up to £2500 per month, continue to work and receive a grant. If we could both continue to work and earn this £2500, our business would have a chance of surviving and we could continue to keep our employees. With the current level of support, we may have to make them redundant as soon as the furlough scheme ends because there will be no funds left in the business to pay them or us.

 

We ASK YOU Boris Johnson, Rishi Sunak, Alok Sharma, Keir Starmer, Ed Davey, HM Treasury, HMRC - the Government, to acknowledge that Dividends received by the directors of micro entity Limited Companies CAN and WILL be differentiated from that of other Investment income (which in nearly all cases doesn’t exist).

Jonathan Geldart of the IoD wrote to MP’s in his press release of 17th April, saying, “Include company dividends earnings in income support”.

https://www.iod.com/news-campaigns/press-office/details/IoD-calls-on-MPs-to-support-small- company-directors

 


Mr Geldart, in his article in the Daily Telegraph dated 9th April 2020, points out that we Small Limited Company Director/Workers are:

1.       TWO MILLION PEOPLE RUNNING THEIR OWN BUSINESSES

2.       NOT THE “FAT CATS” THAT THE WORD “DIRECTOR” CONJURES UP

3.       THAT SOME OF US HAVE PUT A LIFETIME OF EFFORT IN TO OUR SMALL BUSINESS - WHETHER FOR EXAMPLE THAT’S AN, ACCOUNTANT, SOLICITOR, IT PROFESSIONAL, DESIGNER, ARCHITECT, PHOTOGRAPHER, ELECTRICIAN, PLUMBER, CARPENTER, ROOFER, BUILDER OR CAMERAMAN, to name but a few

4.       THAT MANY OF US TAKE ONLY THE BARE MIMINUM IN PAYE SALARY AS OUR INCOME IS ENTIRELY DEPENDENT ON THE BUSINESS WE CAN DRUM UP, AND ONLY TAKE INCOME AS DIVIDENDS WHEN THERE IS A PROFIT

5.       THAT MANY OF US ALSO, WHO ARE NOT PAID THROUGH PAYE, ARE PAID FULLY BY DIVIDEND ONLY AS OUR INCOME, IS ENTIRELY DEPENDENT ON THE BUSINESS WE CAN DRUM UP, AND ONLY TAKE INCOME AS DIVIDENDS WHEN THERE IS A PROFIT

6.       THAT THE GOVERNMENT’S RETENTION SCHEME DOES NOT COVER DIVIDENDS LEAVING US “HIGH AND DRY” AND THAT THIS NEEDS TO CHANGE

7.       ANY DIFFICULTY IN SEPARATING DIVIDEND INCOME FROM INVESTMENT INCOME FOR SHAREHOLDERS IS SUMOUNTABLE AS A PAPER TRAIL EXISTS and can be proven

8.       EVIDENCE OF OUR DIVIDEND INCOME IS IN OUR PERSONAL TAX RETURNS AND DIVIDEND VOUCHERS SO HMRC CAN DEDUCE ELIGIBILITY

9.       IT IS BETTER LATE THAN NEVER TO HELP US

10.   THAT THERE IS SIMPLE SOLUTION AVAILABLE HERE FOR GOVERNMENT WHICH IS THE “PAY FIRST, CHECK LATER” OR THE “CLAW-BACK METHOD”, ALSO PROPOSED BY MEL STRIDE MP AS A SOLUTION TO FIND FAIRNESS.

11.   IN RECENT YEARS, ANY TAX ADVANTAGE HAS BEEN TAKEN AWAY FROM US SO THAT THIS SHOULD NOT GET IN THE WAY FROM PROVIDING SUPPORT TO US

12.   THAT TO SPEED UP THE RECOVERY- WHEN IT COMES - WE ARE NEEDED TO KEEP THE UK’S ENTREPRENEURIAL SPIRIT ALIVE AND KICKING

 

Accountants can easily verify this in a straight-forward income support grant for 80% of our declared or projected income or Company profits up to £2500 ( similar to that required to get a BBL) , and the ability to work in line with SEISS, and claw back later should any erroneous claims be made.

 

Treasury Select Committee - We thank Mel Stride for placing pressure on the Treasury and fighting our corner and await the proposals Mel Stride requested from Beth Russell to support the #ForgottenLtd.

Treasury Select Committee - Andy Chamberlain - IPSE Director of Policy was charged by Mel Stride to come back with their (IPSE) proposed solutions. Thanks to Andy Chamberlain and Mel Stride. https://www.parliamentlive.tv/Event/Index/2e7222ab-76b1-48b6-bbe0-52e5203d5293

Paul Scully – Business Minister – asked for our proposals as to how dividend income could be factored into Income Support for us – and this below was our suggestion sent to him :-

Owners of small businesses that use dividends as a form of payment could be classified into three groups:

 

Group 1:

 

Owners that pay themselves exclusively through dividends and perhaps don’t even run a payroll (we gathered from you that this is how you used to operate). It follows that these companies are unlikely (although not impossible) to have shareholders that are merely investors in the company and do not do any work for the company.

 


Group 2:

 

Owners that pay themselves through a mixture of salary and dividends and are the only shareholders in the business (we fall into this category).

 

Group 3:

 

Owners that pay themselves through a mixture of salary and dividends but are not the only shareholders in the business.

 

The only way to find out which group people fall into is to combine data held by HMRC and Companies House. As the company applying for support has all the information needed it would seem that a simple portal to apply for support could be built relatively quickly and the information given cross checked with data from HMRC and Companies House. The information from Companies House should be the most straight forward as it is publicly available. HMRC data on the other had is confidential and therefore will need special permissions to access. Looking at each group in turn:

 

Group 1:

 

The claimants would need to enter their company number, company tax number and all shareholders claiming support and the level of support (capped at £2,500) plus the tax number of each claimant (this could possibly be used to credit and pay each claimant too on a monthly basis).

 

Checks:

 

1.       Check dividends declared in accounts submitted to HMRC to verify dividends claimed (Companies House accounts may only have a balance sheet so may not have dividend information)

2.       Check individuals tax returns for level of dividends against claimed (this is just a check that at least this level of dividends has been received by claimant as dividends from other sources are not broken down in the tax return)

3.       Check Companies House data to verify all shareholders are claimants and visa versa.

4.       Check HMRC data to verify that company is not registered for PAYE.

 

 

Group 2:

 

The claimants would need to enter their company number, company tax number, company PAYE number and all shareholders with tax numbers and Employee Numbers claiming support and the level of support (capped at £2,500 and broken down into pay or furlough pay and dividends). The tax number of each claimant could possibly be used to credit and pay each claimant too on a monthly basis.

 

Checks:

 

1.       Check combination of Salary cost claimed and dividends is below £2,500.

2.       Check declared salary cost is the same as PAYE data submitted to HMRC.

 


3.       Check dividends declared in accounts submitted to HMRC to verify dividends claimed (Companies House accounts may only have a balance sheet so may not have dividend information)

4.       Check individuals tax returns for level of dividends against claimed (this is just a check that at least this level of dividends has been received by claimant as dividends from other sources are not broken down in the tax return)

5.       Check Companies House data to verify all shareholders are claimants and visa versa.

 

 

Group 3:

 

The claimants would need to enter their company number, company tax number, company PAYE number and all shareholders with tax numbers and Employee Numbers claiming support and the level of support (capped at £2,500 and broken down into pay or furlough pay and dividends). The tax number of each claimant could possibly be used to credit and pay each claimant too on a monthly basis. They also need to enter non-claiming shareholders.

 

Checks:

 

1.       Check combination of Salary cost claimed and dividends is below £2,500.

2.       Check declared salary cost is the same as PAYE data submitted to HMRC.

3.       Check dividends declared in accounts submitted to HMRC to verify dividends claimed (Companies House accounts may only have a balance sheet so may not have dividend information)

4.       Check individuals tax returns for level of dividends against claimed (this is just a check that at least this level of dividends has been received by claimant as dividends from other sources are not broken down in the tax return)

5.       Check Companies House data to verify all shareholders that are claimants are registered for PAYE and non-claimant shareholders are not.

I’m sure the above categories will not cover each and every situation that is in legitimate need of support but I believe that it should cover the majority. It may be that companies claiming support will need to demonstrate in future that they suffered a very significant drop in revenue during this period if the amount given in support is not to be repayable by the company (i.e. to stop businesses that have not been affected claiming). There may also be exclusions in terms of the types of company eligible to claim.

 

Currently many Directors who pay themselves a small salary, will only receive approx. £585 per month under the JRS, which is not enough to pay our business expenses, let alone put food on our tables. And even worse, those Directors who take no PAYE salary, get nothing. We are told by the Government to apply for Universal Credit, which takes into account Dividend income, and is minimal at best, if you qualify.  We would also like to point out that dividend income could not currently exist for us, given the pandemic.

 

 

Evidence of support for our plight is growing with OVER 341,000 Supporting THE CHANGE ORG PETITION, through the EARLY DAYS MOTION #351, which has increased to 44 MP’s – we are actively asking our MP’s to sign this EDM, to show their support.

 


https://edm.parliament.uk/early-day-motion/56824/support-for-small-limited- companies?fbclid=IwAR141XR-u4_CC3e8iRKpjYTZDsShxaHBHKP2skNh2cjfd6QmDSTVTAfUQ3M

 

Within the 20% tax bracket, there is very little advantage of earning through dividends. Based on, say a £30k limit for Covid19 purposes – the difference is £661. The reasons individuals take this route for their business are circumstantial, including coping with fluctuating cashflow, protecting ourselves from unlimited liability. It is NOT to avoid paying tax to the Government.

 

We do not appreciate and find it an outrage being CALLED “Tax Dodgers” when OUR structure is perfectly legal and operating to HMRC rules, when in fact, we contribute 2.2 Trillion pounds in tax year-on-year to the economy, employing 16.6 Million people through our drive, selfless sacrifices, and ethical approach to the way we work.

 

We are deeply saddened that first we were shut out of any substantive income support by government - and then were told that we are tax dodgers. We WERE all in this together before this pandemic when we paid our taxes and collected VAT. Although not NOW, as unlike the rest of the self-employed, we have been left behind. We SMALL company director/ workers ask government to provide us with GRANTS WHICH WE NOW URGENTLY NEED - AND NOT DEBT – BEFORE WE ARE

FORCED TO CLOSE DOWN and retrench our staff.

 

Dividend income is included as part of any financial questionnaire where applications for Universal Credit, Mortgages, University Grants are concerned. Therefore, Dividend income should NOT now be EXCLUDED for income support when it is MOST needed during this CRISIS.

 

Two Million Business Owner Directors, and their staff will be adversely affected by not receiving the same income support that 95% of the rest of the UK are receiving. Their furloughed staff will be laid off or, made redundant – this has already begun – we are already seeing evidence of this in other sectors. We reiterate, many of us are a One-Person-Band Director/WORKERS and that we too are self-employed. Not only will the economy hit depression when our businesses collapse and jobs are lost, millions of individuals will also hit depression not knowing how they will feed their families and pay their bills. Loans are NOT the answer, they are NOT viable and are unacceptable - we need INCOME support just like the Self-employed, NOT debt. Financially, like other sole traders, we small limited company Director/Workers are only as good as our last month’s income.

 

We ask you to take note of Mel Stride, Ed Davey, Jamie Stone, Paul Scully, Andy Slaughter , Harriet Harman, Jonathan Edwards, Jim Shannon, Alison Thewliss’, Andrew Selous and Caroline Lucas’s support - amongst many other MPs -who support our request to government for income support on the same basis as the rest of the self-employed.

Please Support these Directors who in turn will be enabled to continue to support their company, and just as important, support their workers through these unprecedented times before it is too late. This is a crisis within a crisis, we implore you to listen and take the right and proper action for fairness to all Small Businesses.

 

We call on you Boris Johnson (PRIME MINISTER), Rishi Sunak, Alok Sharma, Keir Starmer and Ed Davey (THE LEADERS OF THE LABOUR AND LIBERAL DEMOCRAT PARTIES), HM Treasury, HMRC - The

Government - to do the right, fair and proper thing. This is a cross-party issue for fairness. Please acknowledge receipt of this letter and await in anticipation of your response.

 

May 2020

 


 

Written evidence submitted anonymously

 

As the owner, sole director and only employee of my own Personal Service Limited Company I am dismayed and disgusted with the discrimination of the Government towards limited company directors when it comes to financial support during the Covid-19 pandemic.

I work in the sports broadcasting industry, which was one of the first to be closed down, and yet I, along with many other freelancers in TV who work through their own limited company as the sole employee, have been unable to receive any financial support, unlike those who are employees or self-employed. At the time of writing (11th May) I have earnt precisely £0 since March 15th, whilst being ineligible for any form of state support.

 

All of my many clients are prominent blue-chip companies and institutions, and many insist that I provide my services to them via a Personal Service Company. All my work is done through my company, and I pay corporation tax, dividend tax, VAT and personal tax, which together amounted to almost £25k last year. As I work in various locations in the UK and around the world I do not have business premises, but like thousands of others, work from home.

I found it scandalous when the Government painted a picture of all limited company directors being “tax-dodgers” and when the Chancellor suggested that freelance journalists had an average income of around £200k a year. Absolute rubbish, firstly my company was established in 2003, and has always paid tax, and secondly I know no-one in my line of work who earns that much per annum.

 

As a last resort I applied to furlough myself from my own company, only to be informed by my accountant that I was ineligible to do so. This is because the annual payroll for my company was carried out at the end of March, as it has been since my company was formed and began to employ me as the sole employee seventeen years ago.

According to my accountant, HMRC did not make public that the electronic RTI submission (the way the PAYE is communicated to HMRC) relating to the 19/20 tax year had to be done by 19 March. He queried this, and HMRC then quoted from their own internal guidance to explain why I could not furlough myself. How on earth can they justify this, when it was never in the public domain? I am not alone, many hard working directors of their own one person limited companies are also unfairly excluded. My accountant says, “We are perplexed by the omission of key eligibility criteria from the official guidance.”

The Chancellor stated that we were all in this together, and that no one would be left behind. This is simply not the case. Those who are employed and self-employed can receive financial assistance, and the self-employed can continue to work if they are able to. If I had been successful in furloughing myself, I would not have been able to do anything other than statutory duties for my company.

The Government instead said companies could apply for a loan. Loans for personal service companies are not the answer, my company only supplies my services, and unlike manufacturing for example it is not possible to just simply increase productivity. Also my ability to repay a loan is dependent upon sports fixtures in the coming year and all the major events I was booked to work on in 2020 have been cancelled.

The disparity in support available between the employed, the self-employed, and the one person trading through their own limited company, who are freelance, is discriminatory, and totally unfair.

 

 

May 2020

 


 

Written evidence submitted anonymously

A gap in Assistance for the Events Industry.

There has been additional assistance given by the Government to the Leisure, Tourism and Hospitality industries because of the disastrous effects that Covid 19 have had on these industries. However, Event experts and suppliers supply these industries. Therefore our industry overnight went crashing to zero income from March 2020. Unlike many other industries we are not earning any income during this very difficult period. Events do not and will not occur for approx. 6 months.

We request that the committee give special attention to the £35 billion of revenue that the Events industry bring to the UK economy each year, the events industry in the UK is regarded as one of the best in the world. London is often a preferred Event location for many industries holding their events worldwide, but this industry need long term help of grants to survive. Many event companies are within serviced offices so do not pay business rates directly and so they have found no help.

This industry will not survive and continue to be one of the best in the world unless further help is given through grants. For the committee to consider that the Events industry are fundamental to tourism and hospitality to recover. The government has not directly recognised this huge profit making industry because there is not one SIC code to identify us properly.

We anticipate that the Events industry will not be able to survive the next 6 months of zero income unless assistance is given to help our industry survive.

 

 

May 2020

 


Written evidence submitted anonymously

 

I was working for an agency from September through to December 2019 and then after Christmas I was ask back from the company if I could return again which was dealt through the same agency which finished on the 20th March 2020 because as the agency stated that I had completed my assignment at the company so I was no longer needed.

 

I heard from one of the people I used to work for that the company had ceased working due to the coronavirus pandemic so I contacted the agency and they were quite adamant that because I had completed my assignment I was not entitled to be furloughed which the government were trying to get them places to do due to the pandemic.

 

I have been watching the Martin Lewis in a hope that this would change and also the government statue on the situation so that I could inform the agency so they could change there stance, which the government has published but the agency are still adamant they will not furlough and it is up to them if they will or will not allow, which they are still stating adamant they will not allow.

 

I myself cannot look for other jobs during this period of time because I have contact with elderly parents at my place and I can’t put them at risk as I get them food in from the shops and I was also getting there prescriptions from the doctors until recently, also the fact that I am at the at risk category as well due to my health problems which I have had since I was 10 when I was involved in a RTA when I was 10 which left me in a coma for 2 weeks on a life support machine.

 

I have asked the agency to do the right thing and furlough but they won’t as they state that they are only a small agency and they can not afford to fork out the money to pay but I have said the government will pay, they have asked me not to send them documents through about the government views or any other info which I think is wrong.

 

I have kept all the email correspondence from both parties so if you would like the details I could provide as proof but I don’t see why they should get away with doing what they are doing at this time due to the pandemic as there are thousands of people in the same position as I am.

 

May 2020

 


 

Written evidence submitted anonymously

 

 

It has been a week since I have tried to apply for the BBL with my bank Barclays but until today I have been very poorly treated, lied to by the bank saying that for some customers it works and for others it does not. when in fact they are screening each applicant.

 

My business is eligible but barclays does not play by the books as told by the British Business bank and credit check and screen customers.

 

Why would they need to visit our site otherwise?

 

For evidence, please see footprint of Barclays visit of my company web site [not published].

 

May 2020

 


 

Written evidence submitted anonymously

Job Protection Scheme and Self-employment Income Support Scheme Response to item 1

Unable to claim any support from Job Protection Scheme as left old employment on 26/03/20 was

due to commence new employment on 01/04/20. My new employer deferred my start date by one month and it has been deferred again until June.

 

I asked my old employer to re-employ but would not do so. They admitted that the most recent information from the HMRC stated they could re-employ employees who left employment after the 28th February, but in the same guidance it clearly states that:

 

 

 

 

Please look into the points raised above, there is a large number of individuals in the same position as myself.

 

Why is Government not making it compulsory to re-employ and furlough and removing the reasons quoted above for those in my situation or allowing the new employers to have honoured the job offers issued and furloughed.

It is not good enough that people through no fault of there own have fallen between this large gap. Response to item 4

Speaking from personal experience I have found it difficult to access any support as I applied for new

style new job seekers allowance on 31/03/20 and to date have not received anything.

 

Response to item 7

There is a large gap as per item 1 an urgent review and amendment is required ensuring those who were changing employment get support from either their old employer or the new employer. This could be critical for some families and needs addressing urgently. The token change of date to March is not sufficient.

Other government intervention Response to item 1

The Government do need to intervene and actively resource the benefits agency to allow swift processing of claims.

 

May 2020

 


 

Written evidence submitted anonymously

 

Small Limited Companies Excluded from Government Support – Covid-19 Crisis

 

I set up my company, […], in June 2010. After 20 years as a sought-after artworker and retoucher on the London reprographics arena; also managing the studios for most of the firms I worked for, I decided, in 2010 that I needed a change of scenery and decided to go freelance. I wanted to see how other top advertising studios worked, by working in each for a short time. This wasn’t a gamble. If it didn’t work out. At the time I had plenty of job offers to go back to.

 

Advertising agencies, recruitment agencies and design studios did not want to deal with sole traders. They did not then and today they still do not. So I was forced to incorporate as Limited Company. To be frank, I didn’t care what system I had to work within as long as I was paid for the work I did. That was only fair. I saw it as a mechanism to work and I have followed all the rules and paid everything due, on or before time. Tomorrow my VAT will be taken by direct debit. I could defer it, but it just means debt to take on.

 

My work can take me all over Europe making sure customers’ branding is printed perfectly. I also retouch images for some photographic studios as well as produce artwork for a whole swathe of marketing and exhibition materials. I had a good small business until the outbreak of Covid-19. It did allow me to have a good work-life balance and I was able to support family and sometimes friends going through a tough time.

 

So has Covid-19 affected my business. Yes. A big yes! Suddenly all work I had booked-in up to Christmas 2020 was pulled, cancelled, shelved. Is there a chance of any of this coming back? I’m hoping so. But some for sure will not. A main customer who gave me most work recently has shut their 7 high street shops; these will not reopen. One-man-band photographers are like me, unsupported and some are closing studios for good and making assistants redundant. Because of social distancing, photography studios cannot hire models or make-up artists, this means there is hardly any model photography being taken and therefore this impacts my work.

Brand clients are understandably not asking me to undertake air travel to Europe. I doubt mainland Europe will want Brits travelling to their countries whilst we still have high Covid-19 numbers, so this revenue stream may never recover for me.

 

My business is my only source of income to pay rent, council tax, food, other household bills.

 

I pay myself through a mixture of a small salary and when profitability allows, dividends. If I furlough myself under the current rules, then I cannot take any work should I get a phone call. As a director I would be shirking my duties to put myself in a position where I cannot support the business. I personally have been left out of any support programmes.

 

The Chancellor has offered business loans on favourable terms. But still loans. As a director with no ability to forecast work projects and profits to replay the loan, I am not taking a business loan.

Personally I would rather sleep on the streets than take the business into a debt situation. Debt is not good for your mind. I’ve been in debt, I recovered from debt. I’ve lost friends to suicide because they were in debt. I will not be taken into that place. Taking on debt is a gamble. This Chancellor is forcing fellow Directors to take this gamble. The gamble is their life. Forcing debt is just plain wrong!

 

Also I must point out that Government are paying their own ‘Contingent Workers’ that have been impacted by COVID-19 payments of 80% up to a maximum of £2,500 and that they state that “This

 


approach should be applied to all categories of Contingent Workers including: ● PAYE; ● Umbrella;

●  Personal Services Company.’

 

Please see below from the document assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/88131 4/PPN02_20-Contingent-Workers-Impacted-by-Covid-19-April 1_.pdf

---

Purpose of the Guidance notes for Payments to Suppliers for Contingent Workers impacted by COVID-19

 

The purpose of the Guidance notes for Payments to Suppliers for Contingent Workers is to provide measures that contracting authorities can use to implement with Contingent Workers who have been affected by COVID-19. These measures aim to protect:

 

●  the livelihood of Contingent Workers and avoiding claims of unnecessary Statutory Sick Pay from

the Supply Chain;

 

●  against the risk that some may attend work when they should be self-isolating, thereby potentially infecting wider teams and the broader general public;

 

●  against the risk of losing critical workers to jobs in other sectors because they are not getting paid;

 

●  Supplier revenue with the intention of keeping them solvent so they remain a part of our ongoing

supply chain in the future.

 

---

 

Is it fair that the Government, flush with our taxes, can choose to pay PSCs and others, that this Government deems a Contingent Worker and not force then to furlough? Pay Limited companies it chooses a wage of sorts. Not force their owners to live off scraps or indeed nothing; unlike thousands of Forgotten Limited companies?

 

I would like to see the Government play fair. Or at least admit to Limited Company Directors that they have been forgotten and will be left behind. At least then we will know what cards we are dealt.

 

All I ask for is parity with other tax-paying members of the public and parity with the self-employed; who can receive up to £2500 per month in a grant and continue to generate further income by working.

 

I expect that all taxpayers will be expected to contribute when paying back these government schemes. Where is the fairness here?

 

I expect that the MPs generally see small business as the lifeblood of the economy. Bloodletting was proved ineffective decades ago. Please don’t kill us off. We want to work, we want to contribute, but we would like parity and fairness.

 

 

We ASK YOU Boris Johnson, Rishi Sunak, Alok Sharma, Keir Starmer, Ed Davey, HM Treasury, HMRC - the Government, to acknowledge that Dividends received by the directors of micro entity Limited Companies CAN and WILL be differentiated from that of other Investment income (which in nearly all cases doesn’t exist).

 


 

Jonathan Geldart of the IoD wrote to MP’s in his press release of 17th April, saying, “Include company dividends earnings in income support”.

https://www.iod.com/news-campaigns/press-office/details/IoD-calls-on-MPs-to-support-small- company-directors

 

Mr Geldart, in his article in the Daily Telegraph dated 9th April 2020, points out that we Small Limited Company Director/Workers are:

1.       TWO MILLION PEOPLE RUNNING THEIR OWN BUSINESSES

2.       NOT THE “FAT CATS” THAT THE WORD “DIRECTOR” CONJURES UP

3.       THAT SOME OF US HAVE PUT A LIFETIME OF EFFORT IN TO OUR SMALL BUSINESS - WHETHER FOR EXAMPLE THAT’S AN, ACCOUNTANT, SOLICITOR, IT PROFESSIONAL, DESIGNER, ARCHITECT, PHOTOGRAPHER, ELECTRICIAN, PLUMBER, CARPENTER, ROOFER, BUILDER OR CAMERAMAN, to name but a few

4.       THAT MANY OF US TAKE ONLY THE BARE MIMINUM IN PAYE SALARY AS OUR INCOME IS ENTIRELY DEPENDENT ON THE BUSINESS WE CAN DRUM UP, AND ONLY TAKE INCOME AS DIVIDENDS WHEN THERE IS A PROFIT

5.       THAT MANY OF US ALSO, WHO ARE NOT PAID THROUGH PAYE, ARE PAID FULLY BY DIVIDEND ONLY AS OUR INCOME, IS ENTIRELY DEPENDENT ON THE BUSINESS WE CAN DRUM UP, AND ONLY TAKE INCOME AS DIVIDENDS WHEN THERE IS A PROFIT

6.       THAT THE GOVERNMENT’S RETENTION SCHEME DOES NOT COVER DIVIDENDS LEAVING US “HIGH AND DRY” AND THAT THIS NEEDS TO CHANGE

7.       ANY DIFFICULTY IN SEPARATING DIVIDEND INCOME FROM INVESTMENT INCOME FOR SHAREHOLDERS IS SUMOUNTABLE AS A PAPER TRAIL EXISTS and can be proven

8.       EVIDENCE OF OUR DIVIDEND INCOME IS IN OUR PERSONAL TAX RETURNS AND DIVIDEND VOUCHERS SO HMRC CAN DEDUCE ELIGIBILITY

9.       IT IS BETTER LATE THAN NEVER TO HELP US

10.   THAT THERE IS SIMPLE SOLUTION AVAILABLE HERE FOR GOVERNMENT WHICH IS THE “PAY FIRST, CHECK LATER” OR THE “CLAW-BACK METHOD”, ALSO PROPOSED BY MEL STRIDE MP AS A SOLUTION TO FIND FAIRNESS.

11.   IN RECENT YEARS, ANY TAX ADVANTAGE HAS BEEN TAKEN AWAY FROM US SO THAT THIS SHOULD NOT GET IN THE WAY FROM PROVIDING SUPPORT TO US

12.   THAT TO SPEED UP THE RECOVERY- WHEN IT COMES - WE ARE NEEDED TO KEEP THE UK’S ENTREPRENEURIAL SPIRIT ALIVE AND KICKING

 

A solicitor or an accountant can easily verify this in a straight-forward income support grant for 80% of our declared or projected income or Company profits up to £2500 (similar to that required to get a BBL), and the ability to work in line with SEISS, and claw back later should any erroneous claims be made.

 

Treasury Select Committee – We thank Mel Stride for placing pressure on the Treasury and fighting our corner and await the proposals Mel Stride requested from Beth Russell to support the #ForgottenLtd.

 

Treasury Select Committee – Andy Chamberlain – IPSE Director of Policy was charged by Mel Stride to come back with their (IPSE) proposed solutions. Thanks to Andy Chamberlain and Mel Stride. https://www.parliamentlive.tv/Event/Index/2e7222ab-76b1-48b6-bbe0-52e5203d5293

Paul Scully – Business Minister – asked for our proposals as to how dividend income could be factored into Income Support for us – and this is our response - and to point out that dividend income does not currently exist for us, given the pandemic.

 


Currently many Directors who pay themselves a small salary, will only receive approx £585 per month under the JRS, which is not enough to pay our business expenses, let alone put food on our tables. And even worse, those Directors who take no PAYE salary or an annual salary get nothing.

 

We are told by the Government to apply for Universal Credit, which takes into account Dividend income, and is minimal at best, if you qualify. We are mostly one or two-person-bands, working from home – no other grants are available to us. We ask for fairness and to receive proper income in exactly the same way as other self-employed people.

 

Evidence of support for our plight is growing with OVER 341,000 Supporting THE CHANGE ORG PETITION, through the EARLY DAYS MOTION #351, which has increased to 44 MP’s – we are actively asking our MP’s to sign this EDM, to show their support.

https://edm.parliament.uk/early-day-motion/56824/support-for-small-limited- companies?fbclid=IwAR141XR-u4_CC3e8iRKpjYTZDsShxaHBHKP2skNh2cjfd6QmDSTVTAfUQ3M

 

Within the 20% tax bracket, there is very little advantage of earning through dividends. Based on, say a £30k limit for Covid19 purposes – the difference is £661. The reasons individuals take this route for their business are circumstantial, including protecting ourselves from unlimited liability, and NOT to avoid paying tax to the Government.

 

We do not appreciate and find it an outrage being CALLED “Tax Dodgers” when OUR structure is perfectly legal and operating to HMRC rules, when in fact, we contribute 2.2 Trillion pounds in tax year-on-year to the economy, employing 16.6 Million people through our drive, selfless sacrifices, and ethical approach to the way we work.

 

A case in point: Lord Adonis supported Lord Agnew’s comment that our dividend was not income and tweeted that “Agnew right to say that HMG will not compensate People in Covid-19 Schemes who take income in the form of dividends – they are mostly tax dodgers and they chose to do this”. This unfair comment on social media was upsetting to hard working and tax paying director/ workers.

 

We are deeply saddened that first we were shut out of any substantive income support by government - and then were told that we are tax dodgers. We WERE all in this together before this pandemic when we paid our taxes and collected VAT. Although not NOW, as unlike the rest of the self-employed, we have been left behind. We SMALL company director/ workers ask government to provide us with GRANTS WHICH WE NOW URGENTLY NEED - AND NOT DEBT – BEFORE WE ARE FORCED TO CLOSE DOWN.

 

Dividend income is included as part of any financial questionnaire where applications for Universal Credit, Mortgages, University Grants are concerned. Therefore, Dividend income should NOT now be EXCLUDED for income support when it is MOST needed during this CRISIS.

 

Two Million Business Owner Directors, and their staff will be adversely affected by not receiving the same income support that 95% of the rest of the UK are receiving. Their furloughed staff will be laid off or, made redundant – this has already begun – we are already seeing evidence of this in other sectors. We reiterate, many of us are a One-Person-Band Director/WORKERS and that we too are self-employed. Not only will the economy hit depression when our businesses collapse and jobs are lost, millions of individuals will also hit depression not knowing how they will feed their families and pay their bills. Loans are NOT the answer, they are NOT viable and are unacceptable - we need INCOME support just like the Self-employed, NOT debt. Financially, like other sole traders, we small limited company Director/Workers are only as good as our last month’s income.

 


 

We ask you to take note of Mel Stride, Ed Davey, Jamie Stone, Andy Slaughter , Harriet Harman, Jonathan Edwards, Jim Shannon, Alison Thewliss’, Andrew Selous and Caroline Lucas’s support - amongst many other MPs -who support our request to government for income support on the same basis as the rest of the self-employed. Support these Directors who in turn will be enabled to continue to support their company, and just as important, support their workers through these unprecedented times before it is too late.

 

This is a crisis within a crisis, we implore you to listen and take the right and proper action for fairness to all Small Businesses.

 

We call on you Boris Johnson (PRIME MINISTER), Rishi Sunak, Alok Sharma, Keir Starmer and Ed Davey (THE LEADERS OF THE LABOUR AND LIBERAL DEMOCRAT PARTIES), HM Treasury, HMRC - The

Government - to do the right, fair and proper thing. This is a cross-party issue for fairness. Please acknowledge receipt of this letter and await in anticipation of your response.

 

May 2020

 


 

Written evidence submitted anonymously

 

This evidence relates to the Parliament petition reference 304855 “Refund university rent and tuition fees due to coronavirus”.

 

In any aspect of life in the UK if you pay for a service or product and it is not provided you are entitled to a refund, yet there seems to be a growing belief that this does not apply to university students. I am sure the likes of Easyjet, Virgin Airways etc. will be delighted to discover they can avoid refunding customers when their flights are cancelled, if this is the case.

 

During the lecturer strikes in November and February universities told students the lack of lectures did not entitle them to a refund on their fees as the university facilities were still available, since lockdown this is not the case, therefore a full or partial refund of fees for the Spring and Summer terms should be forthcoming. In the case of 3rd year physic students at Exeter, for example, not only do they miss out on the use of the library and research facilities in particular 3 weeks of laboratory time that will now never be provided, they also miss out on face to face lecturer support during exams which is essential in ensuring students obtain the best possible degree. Research and equipment funding will also be stopped meaning top level fees being paid next year for lower quality facilities, especially Russell Group universities that attract students based on the quality of their research facilities. It is unimaginable in any other sphere where such a reduced provision would not amount to a consumer right for a full or partial refund.

 

Other than 1st year students, practically all students are in privately rented accommodation which has to be paid for in full until the end of the contract despite being unoccupied for 3-4 months. In addition contracts for next year are likely already entered into without any understanding of when universities will open their facilities again. Many students rely on part time jobs to pay their rent, most of which have been terminated (not furloughed) following the closure of pubs, restaurants etc. Private landlords should receive government advice on refunding students.

 

It is unacceptable that students will have £9,250 plus their living allowance of several thousand pounds added to their student loan for this year accruing high level of interest when there is a reduced job market at the end of their course.

 

May 2020

 


 

Written evidence submitted anonymously

 

I run my freelance writer/ nutritionist business as a limited company […]. I'm the only director and employee, paying myself a small PAYE salary topped up with dividends as and when I can. Work has fallen off a cliff during the coronavirus crisis, but if I furlough myself, this would mean being unable to do any work at all and only bring able to claim a net salary of £572 when my minimum outgoings are significantly larger than this.

 

My freelance colleagues who are sole traders and doing essentially the exact same work as me can carry on working while claiming up to £2500 a month for three months from the government.

 

I have only stayed incorporated on the advice of my accountant as some of my work could be construed as giving health advice. Having limited liability is therefore sensible 'just in case'.

 

The current situation is a deeply inequitable one causing me and many others who are part of the #forgottenltd movement great financial and mental distress.

 

I totally understand that there is a lingering suspicion that Ltd companies are somehow 'tax dodgers' and deserve no help as so charmingly put by Lord Andrew Adonis on Twitter (his Tweet since deleted) in April. But based on a £30k limit for COVID-19 purposes, the maximum difference in income between being a one-person Ltd company receiving PAYE/dividend income as I do, compared with being a sole trader, is just £12 a week. How can this justify the gaping disparity in the COVID-19 help being offered to the me and the self-employed who can access the SEISS scheme?

 

This is a most excellent (and brief) portrayal of the situation – I'd urge you to have a look: https://www.facebook.com/ForgottenLtd/videos/653705605420510/https://www.faceboo k.com/ForgottenLtd/videos/653705605420510

 

Another point: it seems contractors trading as Ltd companies who are supplying services to government projects WILL be helped to the same level as the self employed, which does rather expose a double standard. It is NOT too hard to separate dividend income and dividends from investments, as has been the government’s excuse. Ltd companies could easily become part of the existing SEISS scheme with accountants simply verifying our declared income or company profits up to £2500 (with claw back later should any erroneous claims be made).

 

Now is not the time for me and many other small and micro businesses to be penalised – please help before it is too late.

 

May 2020

 


 

Written evidence submitted anonymously

 

The Creative Industries reportedly contribute 111billion to the UK economy each year, and yet the support for our sector is nearly non existent as our way of working and employment doesn’t fall into the neat categories of support set up by the treasury.

 

I work in the TV and Film industry as a costume assistant. This means a mixture of short term PAYE contracts and some Self Employed work, as dictated by the film and television branch of HMRC.

 

In our industry February and March are normally quite a quiet time of year, which means many of us myself included don’t fulfil the criteria for furlough. I myself finished by job on the 10th of February, with a cessation date of 25th February, 3 days before the cut of date. And was not due to start my next job until April.

 

I have earnt on average in my last two years in the industry (the first 2 years of working full time in this industry) £35000 a year. With this years projected earnings due to rise as I had been offered work at a higher level with a bigger wage. On average each month of no work costs me £4000 in earnings. This is

£16000 lost during the 4 months of lock down. And our industry is not one which will be easy to start up again due to the people heavy basis of the work and the difficulty filming will have with social distancing.

 

I have had to go on to Job Seekers allowance to help pay my bills. The first time ever I have needed government support. My savings are gradually disappearing (and with our industry having so much uncertainty in a normal climate this leaves me no safety net when Covid19 is over) and I am having to ask my family for financial help.

 

To answer your particular questions in a nutshell:

-the immediate impact of covid 19 on the tv and film industry is it has shut down. All work has stopped for costume crew with no idea of when it may be able to start again. Which means we are all out of work. And many like me have no financial support , cant be furloughed and cant accesses Self Employment support as we predominantly earn through PAYE, as dictated by your HMRC department.

 

-Furlough Scheme Parameters don’t work for the way our industry employs workers. The monthly payroll systems of most companies don’t apply to us so the date of the 28th February doesn’t actually cover employees from February, but rather those who worked in the 2 weeks leading up to the 28th February.

 

-The Self Employment scheme doesn’t work for many costume staff as we have been told by the film and television unit we are not allowed to on most jobs be Self Employed. So the majority of our earnings is not SE, but PAYE as dictated by

 


you. So overall the only financial support we are eligble for is either UC or JSA. Which doesn’t go anywhere to cover the costs of living.

 

-Many are having to turn to charities for funding and help because they get no support from the government. And yet even though we are doing our bit, staying home, protecting the NHS and saving lives, we lose our income, get no support, but will be expected to help bail out the countries financial debt…debt built up supporting all the other industries!

 

-How has the help been: poor to say the least. I know very few people who are receiving help or even feel like they are being support or thought of by the government. I am getting by on my own very much knowing I am one of Rishi Sunak’s forgotten few. We have received more support from Tracy Brabin Labour MP than by those actually in power.

 

-The long term effects of covid 19 is very little work for the foreseeable future. Jobs wont start up again for much longer than most industries. And when they do fewer jobs will be available as companies try and protect their actors, social distance. And for costume in particular not being able to do very large crowd scenes, makes the need for long term daily work, where many including myself get a lot of work, null in void.

 

-How can you help? Firstly the employees need financial support! Urgently! We need the same support all these workers in the main stream sector of work were able to receive, and we will need it for longer than most. And the industry as a whole needs more publicity to our plight, but also help in working with production companies to organise ways of allowing filming to get under way.

Especially I assume now with insurance becoming a big concern. We shouldn’t as employees be asked to sign away our health and safety rights to be allowed to work, but many of us worry this will be the only way the production companies will be insured to allow filming. And allow us to be self employed in the future so we don’t fall through the cracks next time!

 

May 2020

 


 

 

Written evidence submitted anonymously

 

Thank you for considering my plea.

 

There is a small group of self-employed people (amongst others I expect) which the current self-employed income support scheme (SEISS) does not appear to cover, and this ineligibility seems to me to be without any logic and seems very unfair. I hope is an oversight.

 

This is holiday lets owners where holiday accommodation income is their only form of income, like myself. I meet all the rules to run as businesses under the Furnished Holiday Let (FHL) tax rules as set out on gov.uk page.

 

I also meet all the criteria outlines for SEISS, but the system says I am not eligible. The issue appears to be that this SEISS does not appear to be designed to take the information off the FHL boxes on the property pages.

 

FHLs have a complicated tax status. FHLs are classed as a business. We complete a self- assessment and pay income tax. Small FHLs report their income in the land and property section of a tax return. It seems this means the tax return status is not listed therefore as a trading business, and so we are not eligible for SEISS (under its current set up). This appears to be the issue and why when I check my eligibility for SEISS, the system says I am not eligible.

 

Ineligibility for self-employed holiday let businesses is unfair and unjust. The government specially told all property accommodation providers to close your

business (rightly so) and therefore take away our livelihood (unlike some self-employed businesses who could still trade if they could meet the measures of social distancing and non- essential travel). Other self-employed holiday accommodation providers such as small B&Bs are eligible, why not holiday cottages business owners?

 

I agree with the closure instruction, and I did the right thing and gave 100% refunds to all bookings I had received to date. However now I discover I am not eligible for SEISS. I have no income. There is also an ongoing worry that there will continue to be a fall in demand into 2020, due to any restrictions that remain in place discouraging travel to popular tourist destinations as well as public feeling/fear about taking holidays and being in busy tourist areas. Accommodation providers could be some of the last sectors to be allowed to reopen.

 

Self-employed people have had to wait until now to get any support (unlike employed workers whose schemes were set up earlier). We are struggling. Now we discover some of us may not be eligible for support.

In the scheme of things, I suspect there are not that many Holiday Lets Owners who like me meet the SEISS criteria, so we have a small voice, unlike others. No union to fight our corner. Please reconsider our position.

 

I am very anxious that it may remain the case that I cannot claim SEISS. I have a small holiday let and manage another on behalf of another on the North Yorkshire Coast, as I say I meet all the criteria set out, and it is my only income. It is a small and essential income.

Please reconsider our position.

 


 

 

Thank you for your time.

 

May 2020

 


 

 

My husband who is a Director of a small Ltd company is a sole trader who was advised by his accountants to set up by taking dividends for payment. He is an Engineer who keeps the manufacturing companies of the UK up and running by fixing old machinery and design and development of new machinery. Some of these companies are the ones who are at the moment are making the hand sanitizers for the hospitals etc, but due to the current circumstances he is no longer able to work.

 

My husband has always been an honest person who make’s sure he pay’s his taxes and has always been in work either by being employed or recently self employed. He is now having to get paid Job seekers Allowance £75 a week and told to use his savings to pay bills such as the council tax because of the decisions made by your treasury on not supporting people like him who have always paid into the system. I think it is very unfair of you to categorize everyone to being accused of tax dodging and not paying into a system that you yourselves have devised.

 

There are many others who are having the same issues who cannot pay their mortgages, feed their families etc,etc. I would also like to point out that it was this government that not long ago decided to stop apprenticeships for such trades as Engineering, Plumbers etc.

My husband who is an Engineer and will be retiring in a few years time is a select few of Engineers left in this country with the skills and experience that he has and there will be no one left after him to carry on helping the companies that manufacture in the UK. I think it is a complete insult to people like him when you are now as you have written yourselves giving money out for Innovation and entrepreneurship have powered growth in this country for centuries, and it is what will drive our growth as we recover from this crisis.  When you as a government can not even support the people who keep this country running economically at normal times.

 

May 2020

 


 

 

I am a self employed cleaner who recently changed from a small Ltd company to self employed who now for no fault of my own will not get any help from the government. I never paid myself by dividends but because I chose to move from Ltd to self employed I do not qualify under your scheme. I do not employ anyone so again no help.

 

I have always been a honest person who make’s sure that I pay my taxes and have always been in work either by being employed or recently self employed. I am now having to get paid Job seekers Allowance £75 a week because of the decisions made by your treasury on not supporting people like myself who has always paid into the system. I think it is very unfair of you to categorize everyone to being accused of tax dodging and not paying into a system that you yourselves have devised.

 

I now can not work due to working in people’s homes which is unsafe for be me and my customers. Looking forward to your response.

May 2020

 


 

 

 

Written evidence submitted anonymously

 

This evidence is submitted with specific reference to the following element of the enquiry:

 

Support to businesses and Financial services

 

How effective is the Coronavirus Corporate Finance Facility, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Larger Business Interruption Loan Scheme? In particular, are these measures succeeding in preventing viable businesses from potentially going under during the Coronavirus lockdown?

 

 

I have run my own coach tour operation for the last 25 years, building it up into a significant regional operator carrying tens of thousands of customers on holiday each year. Whilst highly successful for the first 20 years of its life, the period between 2016 and early 2019 were extremely challenging as a result of both a change in my personal circumstances and a flawed attempt to diversify into retail travel between 2013 and 2015. I have spent the last 4 years undoing the damage.

 

I have now sold or borrowed against everything I own in order to turn the business around. The emotional and financial pain associated with our recovery has often been indescribable and I have lost count of the times that I nearly gave up. But I didn’t. I have fought all the way with everything that I have - and by the end of last year my team and I had done it.

 

The underlying business is now more solid than it has ever been. Over the last 3 years we have regained control of our cost base and removed the damaging distractions of our aborted retail operation. Our tour operating client base is still loyal and loves what we do and, above all else, we are fired up for the next part of the journey.

 

Whilst in 2018 we made an operating profit of over £300K, all that was wiped out by the final round of write-offs associated with the retail operation. In 2019 we made an EBITDA of £262K and all our forecasts were for even better in 2020, underlined by our actual performance in the first 2 months of the year and our forward order book for the rest of the year. We were back to pure tour operations, the heart of our business that had remained profitable throughout the trauma of our venture into retail operations. Then COVID-19 hit and 2020 has been decimated.

 

I applied to my bank for a CIBL based on robust recovery forecasts and a range of scenarios, all of which evidenced the clear viability of my business. However, my bank has informed me that I am ineligible for a CIBL based upon one of the conditions stipulated by the British Business Bank on behalf of the government. Namely, the ‘Business in Difficulty’ clause taken from EU State Aid regulations, which excludes any company from the scheme whose accumulated losses are more than 50% of their issued share capital.

 

My understanding is that this clause is generally intended for large, publicly traded multi-nationals and not small, privately owned businesses – and certainly not for the current circumstances.

 


 

 

I have personally put more than £2m in share capital back into my business as I have fought to save it, which is more than my accumulated losses, but not by much. Given the difficulties in extracting share capital back out of unlisted companies, I cannot imagine any business like mine that would not only cover the losses but also put back in another 50% on top! Quite apart from the issues of raising that amount of additional capital.

 

I certainly do not want public money to be wasted or for support to go to companies that would otherwise have failed. But that is not the case with my business. I would argue that we are now stronger than many other outwardly healthy businesses. We have been through all the pain of restructuring and turnaround and come out the other side. We are now far leaner and more agile than we would have been had we not taken the action we did.

 

Everything I have has been put back into the business but because of the Business in Difficulty clause I – and every other turnaround business like mine – will be denied access to the CIBLS. In my case, given that I am in the tourism industry which is likely to be one of the last sectors of the economy to be re-opened, that will certainly mean the unnecessary failure of my business, personal bankruptcy and the loss of jobs and livelihoods.

 

I would ask the Committee to urgently ask that the government seeks agreement from the EU to remove this inappropriate clause as a requirement of lending under the CIBLS or, if it refuses, justifies why it is appropriate and proportionate for SMEs in my situation. If it does not make a change – and very quickly - then many small businesses that had taken responsibility for putting their own houses in order before COVID-19 struck, will have the rug ripped from beneath them.

 

Please find below highly relevant extracts from an article by City.Am editor Christian May, published last month and entitled ‘The coronavirus loan scheme risks failing the people it was designed to help’ which underlines my position:

 

To compound the problem of viability/eligibility, the British Business Bank has passed on further guidance to lenders, requiring that eligibility for funding be based on EU Commission Regulation No 651/2014 of 17 June 2014.

 

Known as the General Bloc Exemption Regulation, it governs EU state aid law. In particular, section 187/19 Article 2 (18) sets out rules concerning an “undertaking in difficulty” and outlines specific circumstances or corporate characteristics which may disqualify a company from aid.

 

It was designed with large-scale bailouts in mind and, according to James Weber, a partner at Shearman and Sterling specialising in state aid law, should never have been applied to the CBILS.

 

A Treasury spokesperson insisted last night that the regulations had to be included in the CBILS in order to comply with European Commission’s Temporary Framework on State Aid. The spokesperson acknowledged that the EU rules pre-date the coronavirus crisis, but said “it is impossible to take this condition out [of the CBILS framework]”.

 


 

 

However, according to Weber, the CBILS categorically “does not need to fall under the terms of existing legislation such as the General Block Exemption Regulation…as [Treasury] officials designed the scheme under great time pressure they have taken elements from existing rules – such as definition of ‘undertaking in difficulty’….the problem with this is that existing rules may be too complex for banks to apply to such a large number of companies.”

 

Weber is confident that if the Treasury asked the European Commission to authorise an amendment to its CBILS rules, officials would grant the change in as little as 48 hours: “If the scheme is not working as intended, the UK can readily amend it. Any reasonable amendment notified to the European Commission is very likely to be approved within one to two days.”

 

If banks are indeed nervous about granting loans to a business it is at least in part because the government has required them to assess the firm’s viability against EU regulations that some feel should never have been included in the guidance. The issue of EU state aid rules hampering the loan scheme is a slippery one. It is cited by some Treasury sources but denied by others; referred to by some banks but not by others; and acknowledged by industry groups and the British Business Bank without anyone being able (or willing) to take ownership of the issue. There is ambiguity where there should be clarity.

 

May 2020

 


 

 

 

Written evidence submitted anonymously

 

I have been a self-employed driving instructor since 2007, working minimal hours due to an illness of Ischaemic Heart Disease. Prior to this I was a police officer for 17 years but due to ill health I had to retire and was awarded a police pension.

 

Due to the Coronavirus situation I have had to stop working from March 23 and it looks like I will not be able to start working until 4th July at the earliest, due to the stringent social distancing measures. The 4th of July date is only possible if everything goes to plan with the Government’s road map on the different phases working.

 

I have never asked for or needed the help from the state for benefits of any kind. I have always paid my taxes to HMRC on time.

 

I have been told that I am not eligible to claim the SEISS grant as my Police Pension is marginally higher than my net profit from my self-employed earnings as a driving instructor during the last 3 years. My average earnings from self-employment or the last 3 years were £12,229 and the average Gross amount from my pension was £12,999.

 

I was expecting to receive 80% of my net profit during the last 3 years which equated to £2,445 in total. Not a huge amount by any means, but sufficient to help us through this crisis. My wife is also a self-employed driving instructor and she is due to receive £2,127 in total. We now find ourselves in financial difficulty.

 

I think the barrier of 50% is disgraceful. Had I been employed and furloughed, I would still have received 80% of my salary, regardless of my pension.

 

I cannot understand why I am being treated differently. For your information, neither my wife nor myself are entitled to claim Universal Credit due to my Police Pension.

 

I wonder how members of Parliament would cope if they were told tomorrow that they were not able to receive any salary or income of any sort for at least 3-4 months?

 

In my hour of need the government have left me out to dry, may I add, through no fault of my own.

 

May 2020

 


Written evidence submitted anonymously

 

In the Film and TV sector there are thousands like me who operate as Freelancers. We tend to work on fixed term contracts, for various productions throughout the tax year. Our industry contributes a substantial amount to the economy, yet we are not being supported nearly enough by the government. There has been no effort made to bridge the glaring gaps for people who fall between them.

 

My high level of concern surrounds the distinct lack of understanding and support from the government for people like myself, who do not qualify for either the JRS or the SEISS schemes. When engaging in a contract, HMRC’s IR35 related guidelines dictate that sometimes I am able to act as self-employed, but mostly have no choice but to be PAYE.

 

I have ten years’ worth of solid tax returns, all SE and PAYE information being readily available to HMRC. I do not comprehend why this data cannot be used to work out an average of earnings and a system put in place for freelancers to claim, without the risk of fraudulent activity.

 

One of crucial and pivotal features of the JRS scheme are the current dates spanning the 28th Feb- 19th March. The very nature of our industry is seasonal, meaning that most productions do not start work until March/April. Consequently, this excludes masses of people from the furlough scheme and is purely reliant on the small technicality of an RTI submission. I began a job on the 16th of March and was stood down on the 18th March, being issued with a week’s notice. The company I was working for, ITV, only pay monthly and therefore the RTI submission was not made before 19th March. Once again, I am excluded, even though I was technically employed before 19th March.

 

My partner is in the same position as me, also a Film & TV freelancer with no access to either scheme for the same reasons. Our household now has no income and Universal credit is simply not enough. Access to our tax records should be sufficient evidence of our working patterns and previous income.

 

All future employment hangs in the balance and we will likely be one of the last sectors to get back to work, even then only at a reduced pace with a reduced workforce. In the meantime, there needs to be a stop gap solution.

 

May 2020

 


 

Written evidence submitted anonymously

 

I am the director and sole employee of a psychological services limited company. I work with the public and private sector. I have had two days’ work in the last few months. I am surviving on my life savings but I am very worried about the future. I cannot furlough myself because I need to keep my business going. It seems very unjust that self employed people are eligible for a grant and able to continue working, when as a limited company director I could only get a fraction of my PAYE income (i.e. no dividends taken into account) if I furlough, but I would have to give up working. People in my situation are desperate and I feel the Government has a duty to come up with an equitable solution.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

We run […] – we’re a small but innovative technology company, world-leaders in our field and we supply brands such as Google, Disney, Coca Cola and Microsoft. We manufacture products here in the UK and design software, all of which are sold around the world. We’re proud to be champions of UK-led design, technology and manufacturing. We employ 5 people and have been trading for 17 years.

 

We mainly operate in the Events Industry which has been completely decimated due to social distancing. We don’t know when the industry will begin to resume – possibly not this year. Until March, we had a profitable, viable business with work booked well into the future, most of which has now been cancelled.

 

Grants aims to help the hospitality industry (SBGF) are only applicable to properties used as venues and completely miss the many other sectors that make up this large industry. Businesses in the event industry have now had to close and will be the last to recover, to keep these companies going the government should have offered the same rate relief and grants available to others in hospitality. Otherwise you save only half an industry which will dramatically slow down recovery.

 

For small businesses, the job retention scheme is simply delaying the inevitable unemployment. While the government is refusing to support the directors of small limited companies most will not be able to afford to keep all or any of their staff when the JRS ends.

 

There are over 2 million small businesses in the same position, none of which are receiving help. The real potential of millions and millions becoming unemployed when JRS ends must be as frightening to the Government as it is to us. There is still time to reverse this.

 

Small business directors need parity with other tax payers and parity with the self- employed who can receive up to £2500 per month, continue to work and also receive a grant. Dividend income is included in applications for mortgages etc, thus dividend income should not be excluded and ignored now.

 

HMRC trust us to honestly declare our income including dividends each year, as they do with all the self-employed, so the government’s excuse that calculating support for small LTD company directors based on dividends is too complicated for HMRC, is simply untrue.

 

As business owners, we are the ones bearing the stress and the responsibility of trying to keep the business operating, and yet we’re are taking home far less than our employees (or, indeed, absolutely nothing), who are receiving 80% of their salary not to work.

 

I have been able to furlough 4 employees on 80% of their salary. I run my business with my wife. We both earn via a combination of salary and dividends. This means my wife is furloughed and is therefore receiving £572 per month. I can’t furlough myself unless I stop working and I need to be at the helm to try and navigate our business through this storm. As such I have had no personal income since March. Our household is therefore receiving £572 per month which won’t cover housing, bills and food.

 

You have helped employees, but not those of us who run the businesses on which they rely for their jobs. We are expected to help the economy recover but have been left out of any Government assistance.

 


 

In 2015 our company was voted one of the UKs top 100 small businesses. We were invited to meet the Chancellor at HM Treasury, where he told us that small businesses like mine are the lifeblood of the economy and how much the Conservative government truly values us and our contribution to the economy. This certainly doesn’t appear to be the case now.

 

May 2020

 


 

 

Written evidence submitted anonymously

 

I’m writing to submit evidence of the economic impact of Coronavirus.

 

I work for a small LTD company. I’ve been furloughed, along with 3 colleagues. Our managing director can’t furlough himself because that means he couldn’t do any work for the company and at this time, someone needs to be trying to drum up business. We supply the events industry, so most of our work was cancelled a few months ago. We do still have a couple of ongoing projects, so he needs to be there to work on these.

 

As he’s a director that gets most of his income by dividends, he’s not taking home any income at the moment, and hasn’t done since March. He’s struggling to survive financially, and neither himself, or the company qualify for any government assistance.

 

I know he’s considering taking out a Bounce Back Loan, but as the events industry probably won’t be up and running for many, many months, he’s concerned that the company won’t have the income to cover repayments.

 

Although we’re furloughed, my colleagues and I are very concerned that we won’t have jobs to return to if the company is forced to close down. This would mean 5 of us will be unemployed in the coming few months. Three of us have worked for the company for many, many years. We’re worried that if we’re made redundant, there will be many millions of others trying to get a handful of jobs.

 

Please consider what while you’re helping employees, you’re not helping owners of small businesses to keep that business alive.

 

I have an associate in Canada who’s also been furloughed, but is able to keep working at their job, to try and help their company survive. Why aren’t we allowed to help out and work at this time? It makes no sense that you’re paying 80% of our salary, and yet we’re not allowed to work – if you’re paying us, you may as well let us do something productive.

 

I also have a friend who is receiving a government grant of £10,000 and can keep working, so they’re actually earning more than they usually would, while our company and it’s owner qualifies for nothing. This isn’t fair.

 

May 2020

 


 

 

 










 

 

 

 

 

 

 

 

 


 

 







 

 

 

 

 

 

May 2020

 


 

 

Written evidence submitted anonymously

 

Small Limited Companies Excluded from Government Support – Covid 19 Crisis

 

My husband, son and I are co-directors of a small limited company with one part-time employee. My husband and son are the two shareholders in […] which was a local thriving business until the Covid-19 crisis struck. Following the Prime Minister’s announcement on Monday 23rd March 2020 and in order to protect our NHS and save lives, we observed the Government mandate to remain at home unless one of our loyal customers had an essential plumbing emergency which could not wait.

 

This left both families struggling financially, especially our son and daughter-in-law who have two young children to support, one of whom has additional needs. We fully appreciate that technically my husband and son are employees of their own company drawing a small monthly salary, but for all intents and purposes (i.e. Universal Credit, loan applications) they are self-employed. We pay corporation tax, personal taxes, dividend tax and VAT payments, all in a timely manner. We have been disappointed to find that there were barely any measures announced in the Rt Hon Rishi Sunak’s statement on 26th March 2020 or subsequent statements to help us weather this terrible time. We supported our part-time employee by furloughing them with the Government paying 80% of the monthly salary through the JRS. We also reluctantly made the decision to furlough my husband giving him a monthly income of £560 whilst our son maintained the limited emergency service indicated above.

 

Our business has always acted within the law. The PAYE/Dividends arrangement was set up and advised by our accountant and if this is no longer acceptable changes should be made through appropriate legislation rather than victimisation. We are not ‘fat cats’ lining our own pockets, merely hard-working people trying to make a living and our annual returns reflect this and can be evidenced. It would be reckless to take on debt at this time. The SEISS is generous but it’s flexibility is only serving to highlight the discrimination small limited businesses such as ours are experiencing where a director must make a choice between minimum furlough monies and no work or no furlough monies and very limited work. There is also brazen disparity in terms of treatment for limited company contractors inside and outside of Government which needs to be urgently addressed. If the PAYE/dividend conundrum can be solved within the public sector it demonstrates that it is possible. We are therefore seeking parity and equality as an outcome from the Inquiry into the Economic impact of coronavirus.

 

May 2020

 


 

Written evidence submitted anonymously

 

 

Company Background

 

[…], an internationally award-winning company, has developed a secure, scalable cloud-based smart home energy management platform for collecting and optimising data collected from smart meters, solar PV systems, batteries and all types of residential heating systems, including district heating. Our market leading and patented innovative smart predictive controls have been demonstrated to significantly reduce lifetime operating costs to UK households worth hundreds of pounds a year per household. […] is the leading provider of domestic solar PV asset management services and its technology has been selected by leading utilities such as EDF Energy and Shell New Energies to differentiate their supply services. The Company has a very active R&D function, with joint collaboration with universities such as UCL and Imperial College.

Job Protection Scheme and Self-employment Income Support Scheme

What problems (if any) are individuals facing in claiming support from the Job Protection Scheme and the Self-employment Income Support Scheme?

 

How effective have these schemes been in maintaining employment and reducing job losses?

Very effective. We have placed 27 staff on Furlough

Is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that fraudulent claims are detected?

Yes

Has the Government struck the right balance between targeting support and making it easy to access?

Yes on JPS

Where has Government support been too generous and where has it not been generous enough?

We have a major concern that there will be a short to medium term impact on consumer confidence and therefore we will need to keep some staff on JBS beyond end June during the economic recovery period

How successful has the Government been in plugging the gaps in the schemes?

JBS has been very successful

What gaps in coverage still remain and are changes required to increase their effectiveness?

Allow part time working for full time employees

How viable is it for the Job Protection Scheme and the Self-employment Income Support Scheme to be

It will be essential. Our business is dependent on trades people being able to

enter  homes  and  on  consumer appetite

 


 

open for longer?

for investing in home efficiency improvements. We are anticipating a slow start due to risk aversion by consumers.

How and when should the Government’s support packages be wound up?

When economic activity levels with an industry sector are sufficient for a business to support its fixed operating overheads. Without this there will be mass layoffs at the end of the scheme.

How should the Government prioritise which continuing sectors and groups to support as time goes on and ongoing support is needed?

Those sectors which would result in societal harm should be given priority e.g. health care, climate change, etc.

What actions does the Government need to undertake to pursue to support a successful exit strategy?

Kick starting a new economy that places greater emphasis on protecting society against future harm: pandemics, climate change, collapsing ecology, etc. COVID-19 has demonstrated that mankind has become a threat to its own survival. We need to create a more resilient planet.

 

 

Support to businesses and Financial services

How effective is the Coronavirus Corporate Finance Facility, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Larger Business Interruption Loan Scheme? In particular, are these measures succeeding in preventing viable businesses from potentially going under during the Coronavirus lockdown?

CBILS has been totally ineffective in meeting our company needs. We are a R&D company in the Energy sector classified under State Aid rules as an Undertaking in Difficulty. We are barred from accessing all loan schemes. There were announcements about Innovate UK money for R&D companies. No money has materialised and Innovate UK cannot provide any guidance on when or if grants will be made available

How effective has the Government support been so far in terms of coverage and speed?

A lot of headline statements but very poor on delivery. Too often the detail has not been thought through (e.g. personal guarantees, state aid rules, banks applying normal credit rules so funding is not getting to companies in need).

What gaps are there for businesses within the schemes?

R&D Software companies cannot access any of the loan schemes (state aid rules, banking lending rules) and it is only a

matter    of    time    before    the    UK  will

 

 

 

 

2

 


 

 

permanently loose some of its shining stars

Is the financial sector supporting businesses enough? Are businesses getting the right advice on which grants/loans to access?

No – Barclays are putting obstacles in the way at every opportunity and none of the banks have the capacity to take on new clients so there is no choice in the market

What are the financial regulators and the financial sector doing to reduce the risk of people being taken advantage of by fraud at this time, in particular with regard to vulnerable groups?

 

 

 

Other government intervention

Should the Government intervene more actively in redeploying staff and resources to certain sectors of the economy (health/food delivery)?

The government should take this opportunity to kick start a Green Economy and all carbon polluting industries in need of bailouts should be placed under contract to repay society through delivering carbon savings.

Should the Government intervene more actively in terms of state aid, bail-outs and its industrial strategy?

 

 

 

Economy, public finances and monetary policy

What economic challenges may arise as the public health and social distancing policies are lifted and the economy begins to recover? What preparations can be made to manage these challenges? For example, could there be difficulty in restarting sectors of the economy quickly, a risk of a spike in inflation, or pressure on the UK balance of payments?

 

Is the economy’s recovery likely to be shallow or sharp?

 

How long is the shock likely to last?

 

Which sectors are likely to be impacted by economic scarring?

 

Which sectors are doing best?

 

 

 

 

3

 


 

What will be the economic impacts of the coronavirus outbreak and the social distancing measures in terms of sectors and regions and how temporary/permanent will they be?

 

What will be the impact on inequalities within society and how should the Government address inequalities that may have been exacerbated by the crisis?

 

What will be the impact on the public finances?

 

What are the potential future implications for tax and spending?

 

What are the implications for the Government’s “levelling up” agenda announced in the Budget/infrastructure strategy?

 

What will be the impact of high levels of Government debt on market interest rates, private investment, capital formation and future productivity?

 

What has and will be the impact on global growth and what shape is the international recovery likely to take?

 

Are there international examples of economic policymaking that we can use?

 

How is the UK Government co-ordinating with other governments to boost global growth?

 

How are countries coordinating their efforts to assist the global recovery?

 

What will be the impact of the outbreak on the Government’s economic, customs and financial sector priorities in its negotiations with the European Union?

 

What are the lessons that society can learn for the future e.g. reducing carbon emissions, increased home working, business resilience?

 

 

 

May 2020

 

 

 

 

 

 

4

 


 

EIC0404

 

 

Written evidence submitted anonymously

 

 

Please treat this submission as confidential

 

[…] has been trading since 1996 and working throughout the UK, EU and wider World.

 

Since March all our work has been cancelled with no prospect of any new work until a date for mass gatherings can be published.

 

I am making a submission to highlight the desperate state of the Events, Leisure, Tourism and Hospitality sectors that employ nearly 3 million people across a wide range of businesses and £billions in turn over.

 

The present situation has resulted in the cancellation of all events and tourism with little propect of any change until 2021 now.

 

Whilst the JRS is keeping staff employed businesses are earning nothing but still paying for premises, insurances and other overheads. Any change to the JRS will only deepen the increasing debts that these businesses are enduring.

 

Most of these businesses have annual contracts that are now lost for 2020 but will be back or are already contracted for 2021. The whole sector needs help and additional grants would help this since. In order to have some limit and control on funding these grants could be limited to an amount of declared turnover for example – or declared overheads. These figures are on Companies House so cannot be open to faudulent claims. For example, a grant of 10% of turnover or 50% of overheads in the previous year would provide some funding to maintain business but with the expectation that business meets the rest of the costs through their own resources / CBILS or other investment.

 

In our own case our expected turnover for 2020 is now less than 30% of our declared turnover in 2019.

 

Therefore, to ensure this sector can return to supporting the economy as it has done for many years support for the business as well as employees is essential.

 

I’ve added futher evidence in replies to the questions raised on the following pages.

 


 

Job Protection Scheme and Self-employment Income Support Scheme

The JRS introduction worked well for us as an employer and once our submission was made we received payment promptly.

As a business in the events sector our income went to zero overnight. Since then we have lost over £380k of revenue through cancelled events (70% of 2019 annual turnover) and expect more to go as the likelihood of us being able to trade this year diminishes.

The JRS has enabled us to keep staff on the books with the hope that something will be possible in the Autumn but if the level of support drops for our sector then redundancies are inevitable which will slow our recovery.

We signed a three year deal with a client starting in 2021 so do not want to lose our key team in advance of this. Without further help we cannot afford to maintain them on our payroll.

The initial JRS scheme has definitely saved jobs but at a huge expense to the UK economy in the long term. Access is easy but for the revised furlough process the funds need to be targeted more toward the independent high street, events, hospitality and leisure sectors and aviation – all the areas that are currently prevented from trading with many having little prospect of any further income before easter 2021.

So whilst access is easy and simple targeting needs to be addressed.

 

 

The support is correct but it needs to be targeted more effectively and quickly to save the treasury money and those businesses in real need.

Some large multinationals do not need the funds – especially when tax revenues from these businesses are minimal.

The 80% JRS in the general economy was definitely beneficial but clearly this cannot continue forever.

The issue in the Events, Tourism and Hospitality sector is that all work is presently cancelled and there is no prospect of any taking place in 2020. Therefore, help is urgently needed in these sectors to keep businesses trading into 2021 and maintaining jobs. The JRS is helping the employees but it isnt helping business. Further grants would help these businesses survive until Government permits them to return to work.

 

 

 

 

 


 

The hospitality, events and leisure industry needs long term support beyond that curently available. Businesses are still paying rents and insurances whilst having no income whatsoever. Until they can trade they can’t pay for these but have to maintain premises and insurance payments to enable quotes and contracts for 2021 and beyond to be finalised.

As advised above, events, tourism, hospitality and leisure, as well as other sectors, will be affected for many months after other businesses are trading “normally”. Events have a lead time of up to a year, or more, and most of the income is at the point of delivery. In our own case we have contracts that will pay in November 2021 – but have to be in business until then to reap the rewards.

JRS needs to be targeted to sectors that cannot work for many months to come – at a high level – preferably still 80%.

 

 

How and when should the Government’s support packages be wound up?

For the events, hospitality, tourism and leisure sector as well as aviation support will now be needed into 2021 if they are to remain trading and pick up with projects. Until the mass gathering figures are made public the whole sector will be dormant. If 100 people can gather it may be possible to run small family events, at 1000 many school and charity events and 10000 public events. But these figures will not help most companies who have little prospect of working until 2021.

For these sectors end of March 2021 is the only realistic target as that is when exhibtions, conferences and events will have been planned and businesses can start to reemploy staff and put income into the economy.

 

 

The hospitality, leisure, events, hotel and travel sectors will need help until Spring 2021, at least, as they are still subject to major interruption from Government action that prevents them from working or even planning to trade.

Individuals are finding positions in other areas so the level of support for the self employed can be tapered off and finish at the end of September 2020 when most would cease their seasonal work in events anyway.

 

 

 

 

 

What actions does the Government need to undertake to pursue to support a successful exit strategy?

Ensuring clarity of decisions and policy is critical and the media need to support the action to prevent misleading headlines as at present.

 


 

Messages have to be simple and understandable – and achievable. Commuting into major cities is clearly more challenging than working in towns and the country where workers can use their own transport and maintain social distancing.

Messages that are portrayed by the media as unclear are then traded on social media to create confusion and civil disobedience from those that need little encouragement to do so.

Financially each sector has its own needs and hopefully the new sector workgroups will clarify and assist the sectors that they are managing. From our own viewpoint we book all our projects from March to September and work from May to December. As a result of Covid-19 and the actions of Government this year is a write off for us with the probabilty of our 2020 turnover only being 20% of our 2019 turnover – assuming that we can provide events in December. At the same time our overheads, excluding staff, have not changed.

So to maintain the Leisure, Hospitality and Events sectors into 2021, and beyond, there is a clear need to offer additional support to business. Employees are being well looked after at the moment but businesses are having to take on huge debts to see them through this year which will have a huge impact on investment and expansion from 2021 – 2025 until debts are cleared.

 

 

Support to businesses and Financial services

We have been successful in obtaining a CBILS from HSBC but this took 6 weeks to come through and is now insufficient to see us into 2021 as we have now lost another 3 months work. So far as I can see there is no way to adjust the CBILS once in place. When we took out the CBILS the expectation and guidance from Government was that it would be over by the end of May. Now we are looking at the end of October for furlough and no trading in our sector until 2021.

The grant was the quickest and most useful business support but it only happened once. It represented 50% of our monthly overheads. If this were to be repeated monthly our debt will still be increasing but it will make recovery more achievable. We are not looking for Government to take over all our costs but to share the responsibility for the situation where we are not permitted to work by Law.

 

 

The next steps are critical to the survival of business. Stopping support for sectors that are still prevented from working will undo the work that has been done to date to save jobs and businesses.

 

 

CBILS adjustments would be useful as the situation in place in March is very different to that in place now.

 


 

JRS needs to remain at the 80% level for the Events, Leisure and Hospitality sectors and probably others that are still prevented from working.

 

 

 

 

Other government intervention

Sectors within the UK economy need more help to enable them to survive and continue trading into 2021 and beyond. There will be some failures of course but if sufficient businesses are still trading into 2021 they will be able to pick up the employees and move forwards.

The references to state aid and bailouts are not necessarily the best terms. Bailouts are not the ideal way forward as that suggests that those businesses were not viable before the virus.

State aid would be better described as grants and these should be limited to an amount of declared turnover for example – or declared overheads. These figures are on Companies House so cannot be open to faudulent claims. For example a grant of 10% of turnover or 50% of overheads would provide some funding to maintain business but with the expectation that business meets the rest of the costs through their own resources.

 

 

Economy, public finances and monetary policy

In our sector (Events, Hospitality & Leisure) the challenges are immense. We cannot work until mass gatherings are permitted. Organising Christmas, Birthday or New Years Parties cannot happen at the moment and there is no prospect of them being possible until 2021 with the current guidelines.

The number of employees and turnover in these sectors is huge and once trading will contribute quickly to tax revenues and employment. Without the income from the Events, Tourism & Leisure sector the economy will suffer greatly.

Tourism was worth nearly £130 billion to the UK economy in 2017 and supports 3.8 million jobs. Saving this sector from closure will not only save jobs and businesses but help the UK economy recover.

Other sectors in the UK seem to be adapting quickly and moving forwards with new ways of working many of which will have a large societal gain as traffic and pollution may be reduced.

 

 

 


 

In the Events, hospitality, tourism and leisure sector recovery will take at least one year for some businesses but up to five years for some that need time to repay debts from 2020, source work and put events in place. This will implicate on investment and employment over this period.

Events, Hospitality, Tourism, Aviation and Leisure are clearly deeply affected now and will be for several years. Many businessess in these sectors will close without more grant aid or other assistance.

 

Food retail and distribution have had to adapt their workpractices but have done so quickly and efficiently and now appear to be trading at the same or above pre virus levels.

What will be the economic impacts of the coronavirus outbreak and the social distancing measures in terms of sectors and regions and how temporary/permanent will they be?

If social distancing will be in place for a prolonged period then the effects on certain industries will be immense. If it’s not possible to hold parties, concerts, exhibitions, conferences or other events there will be a huge reduction in the UK economy and nearly 4 million extra unemployed.

 

 

A lot of new jobs have been created in the transport sector and these have provided opportunites to many in the self-employed sector who have lost their other earnings. These jobs are likely to stay in the long term as these purchasing trends remain.

Those that want to work have managed to find something whether in their own sector or outside. Those that don’t wish to work will continue in their current ways. The current crisis has turned the tables on those that choose to run businesses and those that are happy on benefits. Small business owners now have little or no income with no state support whilst those on Universal Credit, furlough or other support plans have regular financial support.

 

 

 

 

 

 

 

 

As previously stated the Events, tourism and hospitality industry is worth nearly £200 billion to the UK economy with over 3 million employed and almost the same revenues again from contracts won at exhbitions and conferences as well as an increase spend in the UK economy from longer stays and tourism.

These businesses can kick start the UK economy in 2021 – if they are still trading. The more that this sector can be maintained the quicker tax revenues and employment can be increased.

 


 

Small businesses need the support of communities and Government can help with this by assisting them with by reducing / waiving rates payments and also increasing taxes and costs to non UK based non local businesses to make their continued existance.

 

May 2020

 


 

EIC0405

Written evidence submitted anonymously

 

SMALL LIMITED COMPANIES EXCLUDED FROM GOVERNMENT SUPPORT – COVID-19 CRISIS

 

I am a small business owner who has been left out of income support schemes and I urgently need your help. I am supporting the #ForgottenLtd campaign, which represents directors of small limited companies who are not eligible for self-employment income support. I am asking for the Treasury to reverse this policy and put us on an equal footing with the self-employed.

 

My husband and I are co-directors of a hair salon and so we did have access to the Small Business Grant of £10,000 which was very helpful as it enabled us to pay our rent, PAYE and outstanding supplier bills. It did not, however, leave any to replace the complete loss of household income as we, like many other directors, pay ourselves minimal wages via PAYE and take a regular monthly dividend to top-up our income. Our household income has fallen be about 75% to £1150 per month for a family of four which is simply not enough to live on. We have had to take a mortgage holiday.

 

Taking on debt to support our livelihoods isn’t an option, we will already have enough debt, mainly deferred taxes, to manage when and if we can reopen our salon. Without rapid assistance, many of us will go under costing jobs today and crucially those we could have created in the future.

We are calling on the government to immediately protect our incomes by extending SEISS to encompass small limited company directors based on all income for the last 3 years capped at £2,500. To include PAYE (except where already furloughed), dividends and/or income classed as repayments to a director's loan for companies not in profit.

We would also ask that you:

1.  Allow furloughed directors to continue to work to support their businesses as self-employed workers are able to whilst still claiming 80% of their income. THIS POINT IS ABSOLUTELY CRITICAL!

2.  Extend Business Support Grants to all small businesses

If risk-takers, innovators, creators, and entrepreneurs are not supported now, how can we save 5.8 million small businesses and the livelihoods of 7.5 million employees? No doubt you will be relying upon us to share the burden of increased taxes when we all try to rebuild our economy so how can you not offer us the same level of support as other sectors now?

 

Please correct these flaws in the support scheme without further delay.

 

May 2020

 


 

EIC0407

 

 

Written evidence submitted anonymously

 

Hi this is […] a lot of people like me have been basically forgotten from government. I tell you my story . Been in London for 8 years been working in hair salon for the past 6 years, and i been very unlikely to decide to go self employed in October just to be able to go future part time, still working for the same company. Now so many people who didn’t contribute enough like i did in tax for the past 8 years have more right of me from

Furlough, is honestly the most terrible thing could happen i’m 26 so been here since 18 and I never worked in Italy where I born , i came here for fashion and because I always loved London like was my place now I don’t know if i will be able to stay, and if government doesn’t do nothing a lot of people like me will be forgotten and a lot of people like me after even 20 years need to leave the country and what they gonna do? I’m lucky is only me but I hear so many other people who as family and baby and been forgotten. So please if England is always been united let it be don’t forget us. We been part of the story of the country!

Kings regards

 

May 2020

 


 

EIC0408

 

Written evidence submitted anonymously

 

Re: Impact on Self-Employment situation

 

I am a self-employed Photographer, mainly photographing weddings and schools. Prior to this I was a Project Manager with a large multinational. In May 2018 I took the bold decision to resign from my job and become self-employed, introducing the entrepreneurial skills that are so often encouraged. I have made a big success of my business, and everything was going very well, until I lost my summer bookings (and beyond?) as a result of Covid-19.

 

I applied for the government’s assistance for the self-employed, but sadly I do not qualify. You see, I received a salary in April and May of 2018, just before I resigned, and because the remaining months of the 2018/19 tax year was my ramping up of the business, those two months of PAYE salary were more than 50% of my annual earnings.

 

This means that, despite being full-time self-employed for 24 months now, I do not qualify for any help at all. I have a wife and three children to support, a mortgage (for which I simply cannot get through to the helpline) and many bills to pay, and I don’t know how I will cope. I don’t think I can survive much longer.

 

If I had been employed for 24 months (or a lot shorter) I would have qualified for the furlough scheme. It is a real struggle that I cannot get any support in my circumstances. We are desperate.

 

May 2020

 


 

Written evidence submitted anonymously

 

Re: Limited Companies Excluded from Government Support – Covid-19 Crisis

 

 

Dear Sir or Madam,

 

I am a theatre and dance photographer based in London, working throughout the UK. I incorporated my business – […] – on 21st March 2012, as some of my clients were only able to do business with a limited company. Therefore I am a director of a limited company. As of 20th March, theatres have effectively shut across the whole of the UK. Within two weeks, all of my work was cancelled for the year. Earliest realistic estimates of theatres reopening appear to be in twelve months’ time, possibly as long as eighteen months to two years. My income has stopped overnight and I am currently receiving no support from the government.

 

 

Annual Payroll

 

1)      Due to annual payroll, I receive no support whatsoever on the PAYE element of my income. My accountant files my payroll annually for my company, which I understand is standard practice in a small business. My year end is 31st March; therefore it is filed by RTI on 31st March. When my accountant attempted to furlough me she was told by HMRC that I was ineligible because it was posted on 31st March, 12 days after the 19th March deadline. I understand these criteria have been set in case inflated payrolls were being submitted. However, there could be a number of simple work-arounds, including that I submitted a very similar amount for payroll last year. It baffles me that self-employed people are allowed to submit up to 3 years’ worth of accounts (but not this year’s) and those of us with limited companies are only allowed to use this year’s (although not the full year), and are not allowed to use accounts for very similar previous years.

 

Company Dividends

 

2)      I became a limited company director because some of my clients requested I do so. It involves extra administration and creates higher accountancy costs, so had I been able I would have preferred to remain self-employed. My accountant recommended I receive my income in dividends because my income varies so widely from month to month. Some quieter months I may only have turnover of

£500, but in a particularly good month I may reach £10,000. To have a set payroll amount coming out made no sense as I may have taken too much out of the company inadvertently in a quieter month. Trading while insolvent could lead me being open to accusations of fraudulent trading, therefore it was good practise to be paid by dividends. In addition it meant I could keep as much money as possible within the company, which means my company is more flexible and better able to compete and grow.

 

3)      Receiving company dividends means I do pay tax. I pay corporation tax and I am taxed on the dividend. The April 2016 tax changes meant that the tax I pay is roughly comparable to someone

 


earning PAYE. However, my accountant kept me as PAYE due to the reasons outlined in paragraph 2. For the tax year 2018–2019 I paid company taxes of £10,704 and personal taxes of around £2400 (plus voluntary class 2 NI payments). Given I only earnt a salary of £46k for this year I paid a lot of taxes, in the region of £13,100. Having put these figures into a PAYE calculator, it appears I am paying more than I would have had I been PAYE. And yet I am not eligible for any help from the chancellor.

 

4)      Dividend income is included as part of any financial questionnaire where applications for Universal Credit, mortgages, and university grants are concerned. Therefore, it makes no sense that dividend income must be excluded for government support when it is most needed during this crisis.

 

No other means of support

 

5)      I am not eligible for a Small Business Grant as the premises I rent is shared with other small businesses. Furthermore I am not eligible for any funding through the Arts Council, as they have not included theatre and dance photography within their remit. I am not eligible for Universal Credit as they consider my annual payroll (the one that isn’t considered to be valid for PAYE earnings) to have been paid in its entirety on 31st March. Therefore, theoretically I was paid in the region of £9k at that time (obviously this wasn’t the case), which negates Universal Credit. I am eligible for loans; however, with no means of paying this back in the next year I will be accruing debt. I am unable to support my partner and six-year-old daughter, who I usually am financially responsible for, and I am currently relying on rapidly dwindling savings and help from family and friends. In a very short amount of time I will have nothing unless the government considers changing the rules.

 

Benefit to the community of running a small business

 

6)      As a small company I create work for others, I am flexible, and I can respond quickly to economic changes. I keep some liquidity within my company to enable me to do so, and I pride myself on being able to weather most storms. However, with the current pandemic I am completely unable to work and am completely unsupported – I am not receiving a penny from the government to help me. With the earliest estimate of the reopening of my industry being an entire year, I face the closure of my business should things continue as they are now, and this will have a knock-on effect to others. With the country facing an enormous recession, the government needs small and medium-sized businesses to survive to help keep the economy going and to continue paying the taxes we do. I do not personally employ staff, although most small and medium-sized businesses do

– these employees are being supported by furlough, but their bosses are not. By not supporting limited company directors and by discounting those of us on annual payroll, the government is leaving millions of people in a precarious financial position and will be hampering the ability of this country to come out of a recession.

 

 

How can the government help?

 

I have described only my own experience above. However, according to Merchant Savvy, there are 5.9m private businesses in the UK; more than 99% are SMEs, many of which will be run by a limited company director currently receiving no support. If these individuals go bankrupt the knock-on effect to the population and the economy as a whole will be catastrophic. To help counter this:

 

 


come, and that may cause the business to fail. We wish for parity with the self-employed and those in employment.

 

 

I look forward to the acknowledgement of receipt of this letter, and I eagerly await the response of the committee.

 

May 2020

 


 

 

 

 

 

Written evidence submitted anonymously

 

Job Protection Scheme and Self-employment Income Support Scheme

 

What problems (if any) are individuals facing in claiming support from the Job Protection Scheme and the Self-employment Income Support Scheme?

 

When the Chancellor announced in March 2020 that a furlough scheme for those people to receive an income due to their workplace being closed because jobs would be saved until they can return to work was a good idea and still is. However as a supply teacher the problems I am still facing from the Job Retention Scheme is because since my teaching contract or assignment came to a natural end at the beginning of April 2020 due to the teacher in the institution returning to work, it did not need to be extended. I then contacted my umbrella company about the situation because I was on their PAYE system before March 2020 and continuously used them when this contract arose. They said “that I am not eligible to be furloughed due to the supply contract came to a natural end.” Although I understand what they saying and this is correct, I also cannot claim universal credit due to not being eligible for that either. I don't have any support from anyone else so the question is how do I carry on living in today's society and the near future with no income coming in? Tried to change jobs from the education sector but employers are not interested and do not respond. A lot of teaching institutions only want (qualified) teachers for temp and contractual assignments but not offer secure employment. Any suggestions? To be honest this has not just occurred due to the virus outbreak, this issue has been going on for years but the Government and employers themselves do not look at us as being part of society and yet we are the ones who step into other staff members shoes to quickly pick up their jobs up at immediate notice sometimes. Is this issue not telling people to do something about it urgently because there is no wage protection, hardly any holiday pay if any at all, can't even go into the teachers’ pension although I'm a trained mainstream teacher that is qualified in my subject area and may not be entitled to sick pay etc. Overall since my PGCE I did not choose to be a supply teacher because I have always looked for full time, permanent IT and Computing teaching roles but due to the lack of vacancies especially since 2008 in the surrounding areas where I live and beyond the borders where I am based in Lancashire, many institutions only require temporary and contractual work to be carried by teachers. Many classrooms that I have seen in institutions I have taught in have been filled with full classes of learners but no teacher due to the member of staff being off sick or no teacher being employed. Many members of staff in these teaching institutions have asked their Manager if they could employ me but they always say there is no funding available, it’s because of agency fees and no recruitment ever comes forward although the Government is missing targets in the teaching profession and the UK has a teacher crisis. There have been times when I have considered leaving the teaching profession due to the lack of secure work. Employers even look at supply teachers as though we are not employable and not stable because we move from one job to another so we are never provided with secure employment. The problem with supply, recruitment agencies is that they look at profit which is understandable since they are businesses. However teaching institutions only want teachers who can be in front of class can pay them low wages and leave them quickly. This is another issue that needs to be addressed if you want to retain teachers effectively in the teaching profession regardless of age, gender, culture, race etc. in the subject area(s) they teach.

 


 

 

One day I would like to buy a house rather than rent but supply work is not looked at by the housing lenders as being sustainable which I do agree with but does that not tell society that banks and building societies need to change and adapt their approach in helping people like myself to be able to invest in a property so the housing market keeps on moving rather than let it continue as it is in a different work. Many people today also work in temporary contractual jobs that are no longer secure compared to how employment used to be and could be. Therefore attitudes in society need to change if you want people from different industries to uphold the UK and live properly.

 

How effective have these schemes been in maintaining employment and reducing job losses?

 

Many supply and recruitment agencies have probably found that work coming forward from institutions being closed is very quiet so supply teachers have not gained anything during the lockdown that is understandable. Therefore I applied for several roles that I am awaiting answers on that have been postponed or may re-occur at a later date in the year and I also applied for online tutoring and assessing work across different age groups within my subject area because I can teach pupils aged eleven up adulthood since having experience in High Schools, Colleges and training providers with apprentices. However I have received no replies about online work so I am still in the same position as before. As a supply teacher you need to be registered with a number of agencies to help you gain work even in various locations. Since the scheme was launched from my perspective carrying this type of work for their clients, I have found it not be effective in maintaining employment. For example the Manager at the agency that I have now finished the teaching contract for, furloughed all his staff so the Education Consultant I was put with could no longer find me any work during this lockdown even if it’s online. On the one hand I understand the Manager has done this in terms of the scheme and keeping the company afloat during the pandemic. However as a supply teacher I was told from this particular agency that the Manager would be finding work for us. To be honest if I had not contacted him after this contract had finished, I do not think he was going to do anything. Since the start of April 2020 he has not or any of his staff if they have come back to work off the furlough scheme have been in touch and found any work so again I am still in the same position as before and without any income coming in that is six weeks in total counting next week in May. Many recruitment and supply agencies prefer the teacher to only speak to the Education Consultant that they are put with from when a contract is found which does make sense because they should have all the necessary information. However the scheme is not effective since the Education Consultants have been put on furlough and do not know when they will be in work or not, does not help supply teachers who are looking for work because if I am not receiving any responses from other employers due to postponement, the consultants do not allow other colleagues in their workplace search for work and they do not respond what are we supposed to do? Morgan Hunt and Protocol appear to be different due to answering information and searching for work that supply teachers can gain without going to their consultant if for example they are in a meeting, on holiday or just left the office.

 

 

 

 

 

 

How should the Government prioritise which continuing sectors and groups to support as time goes on and ongoing support is needed?

 


 

 

The sectors and groups of people that I see that need support now and on-going support are those who are freelancers e.g. supply teachers, theatre workers, make-up artists etc. Yesterday on the 5.00pm – 6.00pm news a theatre worker asked the panel about what income he can live off since he has no work. I felt his question was not answered at all that is an issue on its own because I never hear anyone on the news e.g. the presenters and Government to ever address what money do we live off if we are not all eligible for other benefits? These groups of people are always forgotten so the Chancellor has not addressed everyone but surely the question is, when is the Government or who will stand up and talk about how freelancers are paid? It isn’t always possible for us to claim Universal Credit and other benefits because by law when are not eligible to receive the income.

 

What actions does the Government need to undertake to pursue to support a successful exit strategy?

 

The Government should create an on-going support strategy like the Income Based Scheme that they can customise only for those workers who work in freelance roles such as supply teachers, theatre workers, make-up artist’s etc. because the Government has got to remember that the work we carry out in these industries do not run all year round. For example as a supply teacher I may work up to a half term that is a holiday due to the way the Education sector works. At this time of year teaching work stops because learners are having exams and/or completing assignment work etc. Then August arrives and again no more work due to it being a holiday for them. September and October arrive again not much work or if any occurs so supply teachers do not receive any income. Therefore if the Government prioritised an income scheme that was not means- tested and allows only these groups of workers to be paid a wage alongside the work they carry out as and when it arrives then, at least we have some income coming in. The scheme should not though be open to self-employed, part and full time workers who are on contracts because their work is regular but the type of work I carry out is very inconsistent. For example I can work for a College from the beginning of January to the half term in February only. However work is not always found by agencies straight after this contract ended so I can be out of work for days, weeks, months and years. Even if I apply for other roles alongside doing this kind of work, in my position I still don’t receive any money from anyone or anywhere to live off. Therefore it should not been seen as a benefit like the Universal Credit system. It should be a scheme that allows these groups of people only to still carry out the work they enjoy as well as receive some income so they can support themselves. The Government could even create an online portal that is customised only about these groups of people like myself where we enter out name, job title so the Government or HMRC know that we receive the basic income support. The number of hours that we carry out should not be included though because for instance I sometimes receive a contract that could be two days’ work but only expected to teach three hours per day. Other times the client may have extended the amount of hours in their workplace from twenty four to thirty hours in a week. As a supply teacher you always try to gain as many contact hours as you can since that is the only income I receive and have always paid my taxes and student loan out of it.

 

 

If any of these workers in these groups change roles to a different industry or it just being the same and part or full time work with the employer is offered as a contract of employment with them then, the information on the portal would just be stored if they ever returned to it and obviously stopped so the income based scheme does not apply to them at that particular time. These groups of workers

 


 

 

should not be expected to attend an office or job centre like the benefit system because these workers are actually working amongst employers and their work whether it is setting up a stage for a production or teaching classes does not allow time to visit such environments. The employers or clients of these contracts via the agencies would not work because you cannot have a worker leaving work or rushing to sign anything for the income to be paid to you if they require you to be working for them. Therefore an online portal where people can enter this information via a computer, mobile phone, tablet etc. should be considered especially in today’s society and paid into their bank accounts when possible.

 

 

May 2020

 


 

Written evidence submitted anonymously

 

Hi,

 

Please help me!

I am a small LTD Company business owner who is close to giving up!

 

Myself and my wife run an entertainment company providing fun casino entertainment at weddings parties and corporate events. […]

Turnover £80,000

Run from home, no business premises 2 x Staff

10 x subcontractors that work on a self employed basis for us

 

Myself and my wife are paid by dividends (as advised and organised by my accountant) We all pay our taxes.

 

Our business has been devastated by the coronavirus. We have had no paid bookings since 14th of March.

With social distancing being in-place for the foreseeable future we don't envisage anyone organising a party till Autumn or after = We have no income to the business.

We employ two people both of which have been furloughed.

We are running out of money and frustrated that we have only been offered a loan to pay for our overheads, bills and food!

 

It seems very unfair that we risk everything to build a business and employee two people and support the income of a further 10 people that we only be offered the opportunity of going into debt to help us pay ongoing business costs and pay for our food and household bills.

We put our trust in our accountant and apparently because of his advice we are branded 'tax dodgers' that are not worthy of any support?

 

If everybody was offered a loan then we would be taking a loan however:

- Teachers are on a 3 month full pay holiday (and I am sure they won’t give up any of their 6week summer holiday!)

-  Self employed 80% (some of whom are still wording and don’t need it)

-  Small businesses with premises £10k grant (even if they don’t need it)

 

I am very close to giving up and folding the business. This would effectively put 4 people of out of a job and significantly affect the other 10 people who’s income is supported by us.

 

No Universal credit as we have a rented property that is our pension.

 

Please help me, the unfairness of the situation I find myself in is causing stress, depression and a horrible bitterness that is growing inside me.

 

I have never ever claimed any support from the Government and in my hour of need I see lots of people benefiting and people looking at me in disgust because I am a tax dodger asking for help.

 

I need urgent help…. Please!

 

May 2020

 


 

 

 

Written evidence submitted anonymously

 

I would like to add some additional detail, if I may to the above submission reference, in respect of policy changes made since the above was submitted.

I would be grateful if the below could be used in conjunction with Ref XGB702960

 

SEISS £50K Cliff Edge v CJRS Unlimited Cap

We have seen the CJRS now extended until Oct 2020, remaining on an unlimited earnings cap basis. Crucially the chancellor stated to the PAYE nation that this ‘would not see a cliff edge end’ preferring a tapered approach. I agree with this. Economist’s warned of the dangers of a ‘cliff edge’. Thankfully for the PAYE sector this was avoided. So why is it still acceptable for the SEISS scheme to have a £50k cliff edge?

The schemes are designed, I believe in policy with the ethics of

 

 

This is constantly repeated on TV by the Conservative Government politicians

 

Yet I read that the CJRS was extended to in addition to high earning employment categories of PAYE staff (and is including) professional football players, some of whom are carrying contracts from a previous and recent Premier League era.

It is reported that these contracts are up to and including circa £500,000 to £1,000,000 PA. Yet the local trader a penny above £50,000 has his income ‘averaged up’ to £200,000 and it is stated forms the ‘wealthiest’ sector of society (because of this ‘averaging up’) and is not in-keeping with those that need help. Whilst reading of the CJRS doing just that?

It is not even close to parity. Nowhere near. It is also impossible to fathom this divisiveness and exclusion out to this level of difference. If £200,000 was the cap why not set it at

£200,000, across all sectors? Or the £50,000 across all sectors?

In this live example the uncapped CJRS benefactor has an annual salary some 2000 (two thousand) % above the SEISS cap!

To recap the CJRS is benefiting from

 

 

 

 

It is far from unreasonable to request an amendment to the SEISS to at least remove increase or taper the cap, to allow many just above the £50k cap to receive SOME grant assistance. The on-line system is in pace and will not require any significant amendment to do allow this . A new on-line system does not need to be created. If it did we would wait. HMRC have until Jan 2021 before the tax bill is due. This is 8 months. As previously stated an adjustment to the tax bill could even be made. There are ways, If there is the will to help.

 


 

 

 

How Viable is it for the SEISS to open for longer

Whilst I support those who have requested an extension to the SEISS where needed in line with CJRS extension, can someone at the Treasury please just for a moment take some time to concentrate on those affected by matters such as the £50k cliff edge and try to put some resources, effort and thought process into trying to help those first please. Those to date who are living (or supplementing) off savings or fresh air!

It is clear now that even UC is a boundary for many.

As I have previously noted some fair and rational middle ground recommendations are on the chancellors desk. It really does feel like one is crying into the abyss trying to get even a response.

Its incredulous that more and more resources are ploughed into finding more money for those already who have had help. I am not saying help is not required here but if the finances are needed to help those that need it most, in the spirit of fairness those just above the cut off cap should be surely eligible now for some assistance?

It really is time to try to help, even if it is in a reduced grant assisted capacity, those left with only the option of a loan from outset. Surely?

 

 

I would also like to point out some facts now that Robert Jenrick has ‘tentatively’ opened up the property sector again. It is estimated that there are some 327,000 surveys ‘banked up’ that were put on hold because of the lockdown. It is estimated that these alone will take approx. a month to work through. This is assuming that ‘all the boxed are ticked’ ie vendors not shielding, vendors & surveyors comfortable to enter properties. So income wil take time to start filtering through. It is not like an Industry that can do a piece of work and get paid that day or the next week. It takes months.

Mortgage lending remains strained at higher LTV’s in general market wide. This restricts new business capacity in many geographical areas and purchasing sectors such as first time buyers. Parents will be less likely to be able to freely gift deposits to make up shortfalls, as they too enter unknown circumstances.

I have seen previous potential buyers withdraw as they await to see what the near term future holds for their employment.

Viewings (at present) the very first step in the process remain very very low.

New business enquiries have largely dried up. To date, as previously noted the drop off in this particular field of new business (residential mortgage) remains (at present) at a 100% decline pre lockdown enquiry rate. Whilst this will (hopefully!) improve it does not detract from where we are and where we have being over the past 3 months or so.

All fully understandable. But all will have a major impact on my income moving right through 2020.

 

Yet it is deemed that because I earned £115 over a cut off cliff edge cap (a rule completely isolated only to the SEISS) I shouldn’t get ANY financial grant assistance of ANY level other than a loan?

 

This needs to change.

 


 

 

Thank you for taking the time to consider each of the above additional points raised in addition to points raised in XGB702960

 

May 2020

 


 

 

Written evidence submitted anonymously

We are facing the biggest challenge in our company’s history – events businesses like ours will need to survive three ‘winters’ back to back

Current Situation

Within 48 hours of the lockdown […] saw annual revenue drop around 80%. Most customers cancelled their events effective immediately.

[…] immediately furloughed 90% of employees using the Coronavirus Job Retention Scheme which has been effective at reducing the company's salary burden and avoiding immediate job losses.

Like many seasonal events businesses […] trades at a loss or break even during Q4 and Q1, making its profit during Q2 and Q3 when the majority of events take place across the UK and EMEA. It is highly unlikely that the event market will be allowed to return in 2020 and there is concern that even the 2021 season will not be a full return to normal so in reality […] will have to survive through its typical summer season, then the off season 2020/2021, a partial recovery in the summer of 2021, followed by another winter. It is not really expected that the events industry will fully recover until 2022.

[…] is looking at the ‘bounce back’ loan program but at £50k this supports around one to two month of operational costs, not sufficient to make it through the ‘off’ period.

Seeking support from banks is currently not available. Banks do not ‘understand’ the events market as it falls outside more typical industry types even though it is a significant contributor to the UK economy.

The Impact of Covid on Events

The UK is a worldwide leader of live experience events. Glastonbury, Boomtown, Isle of Wight Festival etc are global brands whilst many of the international tours for artists such as Elton John, U2 and Taylor Swift are operated from the UK due to their experience and ability. Social distancing and customer confidence to purchase tickets has caused a massive impact. Extended support, most likely of around 18 months, will be required assuming a vaccine is in place by the end of 2020.

Business led events will most likely come back as their attendance can be controlled, however, this will take some time, most likely once a vaccine or clear government direction is in place.

Planning for future pandemics should be part of the fabric of event planning, just as CDM or other functions are today. This could include temperature monitoring on arrival (most events already run CCTV systems for their licencing)

What we need

The Coronavirus Job Retention Scheme should be evaluated per industry. Those such as […] who operate in highly seasonal markets should be able to continue to use the program. The live events industry may require up to 18 months support.

The bounce back scheme should be extended to help companies of our size, who will need to borrow to make it ‘through’ to the next season.

What could happen next

With the right industry support in place the events market will return. People enjoy live events, the experiences form part of their relationships with friends and progressing through milestones in life (finishing university, etc) with business events and conferences forming an important part of the sales process. With the right steps in place this industry could start to return in 2021 and effectively be as before by 2022.

 

 

May 2020

 


 

Written evidence submitted anonymously

 

I’ve been successfully freelancing as an advertising/marketing copywriter for 7 years. After being made redundant on the day I found out I was pregnant with twins I had no other option but to attempt to go it alone. Who would employ me in those circumstances? It has gone well though and I’ve made around £3K a month ever since – I’ve turned down tonnes of work because I was too busy to do it before COVID 19 struck. But I have not made a penny since the end of March and my clients – agencies mostly — are all totally quiet and many have furloughed their own staff.

 

If I was self-employed I’d be eligible for generous support, but I went Ltd about 3 years ago. Why? Certainly not for tax benefits or for any personal strategy. I was actually proud to pay tax and to support our services and people in need. Despite having at least 8 regular clients. I'm not in one place all the time like say IT contractors and don’t get many long term contracts – it’s not the way my role works -usually it’s a day here and 2 days there – if you do a good job you maybe get 6 days a month per client when they need someone – twice in 7 years I’ve had longer contracts ( of about 3 months). However, the biggest agencies I worked for demanded I went Ltd to protect themselves from employment laws — it was that or not work for them. So now I’ve been hung out to dry. I am now living off my hard-earned savings. I have 3 kids to support and a mortgage and my partner has been made redundant from September. I have furloughed myself but apparently won’t be eligible for more than a few hundred pounds a month - when I get it.

 

What is so galling is that relatively wealthy friends of mine who are freelance but not limited are claiming thousands (and receiving it instantly) despite in many instances having partners on large salaries, no kids and working in industries that seem set to ramp up again very soon.

What’s more I’m home-schooling 3 children (Inc. two six year olds – year two so not even likely to go back to school this year, so can’t got out and look for jobs. I feel sick with worry about it to be honest. I’m depressed. I’m having nightmares every night. I’ve worked hard, I’ve paid taxes and now I’ve been treated like I’m worthless – or assumed to be a tax dodger. I’m usually a cheery optimist, but I feel destroyed and betrayed. I’ve heard stories on Facebook of limited directors committing suicide. I can’t verify them but it wouldn’t remotely surprise me. I won’t do that to my family but it crosses my mind all the time. It’s not just the money it’s the complete unfairness. The discrimination. The sense of being abandoned when others are being helped out. The feeling that people think you somehow deserve to be left out. (I have barely benefited from limited status at all – except as a way to secure work). The shame of not providing for your family. And the horror that everything you’ve worked for has been swept away and no hope for the future. If I was eligible for the self-employed scheme it would give me the breathing space to try and save my livelihood. It would also make me want to. At the moment I feel defeated. What’s the point of trying to start again when my tax just will go to pay for others’ generous furlough schemes and payouts? When I have no idea if the industry, I work in will recover. I’m due to pay corporation tax in August. Honestly why should I? I’m living off that money and it won’t last.

 

May 2020

 


Written evidence submitted anonymously

 

Current Situation

The business is a Limited Company where Directors are paid by a salary and dividends but on an annual basis via a tax return – not PAYE.

 

As a Director, I have tried to claim personal support and have been refused on the following basis:

              Dividends – as pay part of my income is in dividends, I do not qualify for the furlough

              PAYE – as I declare my income annually, via a tax return, I do not qualify for any furlough support for my salary.

I accept that this situation is not as easy to calculate as a monthly PAYE scheme but all my personal and the company’s data is held within the HMRC / Companies House records.

Proposal

HMRC to create a web-based claims page that enables the claimant to attach:

To keep the message simple, the claim for dividends and salary combined would be 80% up to a

£2,500 limit per month to align with the furlough scheme.

Rationale

This is a viable proposal that should be investigated if the Government’s objective is to deliver fairness.

A final observation

I see large organisations who have offshored their taxes over the years, receive Government support. This is in stark contrast to those who have paid everything they have been asked to pay in the UK and are now refused the help they need.

May 2020

 


 

Written evidence submitted anonymously

 

“You have not been forgotten. We will not leave you behind. We are all in this together.” (Rishi Sunak, Chancellor, 26 March 2020)

 

Yet, despite continued pressure from various quarters, including but not limited to, the Treasury Select Committee, IPSE, Institute of Directors, Unions and #ForgottenLTD, for the Treasury to address the lack of parity in support between employees, the self-employed and small limited company directors, the silence from the Treasury is deafening.

 

I am getting increasingly angry and despondent as a result of the Treasury’s apparent entrenched view of small limited company directors. It would seem the following statement has become the stock reply from government:

 

Jesse Norman, Financial Secretary to the Treasury, on 11 May 2020:

 

“The Self-Employment Income Support Scheme (SEISS) is intended to support individuals who rely primarily on their trading profits from self-employment as their main source of income, and whose income has been adversely affected by COVID-19

 

“Income from dividends is a return on investment in the company, rather than wages, and is not eligible for support. Under current reporting mechanisms it is not possible for HM Revenue and Customs to distinguish between dividends derived from an individual’s own company and dividends from other sources, and between dividends in lieu of employment income and as returns from other corporate activity. Expanding the scope would require HMRC to collect and verify new information. This would take longer to deliver and put at risk the other schemes which the Government is committed to delivering as quickly as possible.

 

“Individuals who are not eligible for the SEISS may have access to other support Government is providing, including the Bounce Back Loans Scheme for small businesses, the Coronavirus Business Interruption Loan Scheme, and the deferral of tax payments.”

[Ref: https://www.theyworkforyou.com/wrans/?id=2020-04- 29.41545.h&s=limited+company+directors#g41545.q0]

 

 

The reality as a sole-director of my own limited company:

 

 

 

 

 

 

 

 

1

 


 

A screenshot of a cell phone Description automatically generated

 

Above: Tax Schedule Reports 2018–2019 (Identifying details of my company obscured for data protection)

 

 

 

Are small company directors deserving of support?

 

The perception of small limited company directors not being deserving of support also seems to persist. Therese Coffey, Secretary of State for Work and Pensions needs to acquaint herself with the facts of Limited Company taxation:

 

“It is good to see my hon. Friend doing well over in Northern Ireland. I want to stress again that the scheme established by the Treasury will cover about 95% of people who receive the majority of their income from self-employment. I have tried to share with the House some of the approach taken in order to support people who pay themselves only, in effect, by dividends. As I pointed out earlier, a small percentage of people get the majority of their income in that way, on which, in effect, they pay only 7.5% tax. I am conscious that it cannot be decided whether dividends are solely for substitute pay or whether they are a return on investment, but I encourage those people to consider other forms of support that may be available at this time.”

 

[Ref: Therese Coffey, DWP, 4 May 2020: https://www.theyworkforyou.com/debates/?id=2020-05- 04a.432.0]

 

 

 

 

2

 


The reality:

 

 

We are also not such a ‘small percentage’ and collectively we provide employment for millions (a significant number of which will currently be furloughed and hoping there will be a job to return to) as the figures from Business Population National Statistics for 2019 published by BEIS demonstrate:

 

Businesses defined by UK Legal Status as Companies:

 

[Ref: Business population estimates for the UK and regions 2019: detailed tables (Table 3: UK Legal Status) and https://www.gov.uk/government/statistics/business-population-estimates-2019]

 

That’s a lot of small limited company directors who provide a significant percentage of employment. We need parity of support.

 

This is the stark reality of the lack of parity:

 

Employee

80% PAYE March–October CJRS: up to £2500 a month

£20,000

Self-employed

80% Trading Profits March–May SEISS: up to £2500 a month

(unless extended in line with CJRS)

£7,500

Furloughed Director

80% PAYE March–July CJRS: £575 a month

(55% PAYE August–October reduced CJRS?): £395 a month

Dividends from Trading Profits excluded

£4,060

Non-furloughed Director

No CJRS; Dividends from Trading Profits excluded

£0

 

It seems small limited company directors have been deliberately forgotten; we have been intentionally left behind – the sacrificial lambs (‘Trade-offs’ in the Treasury’s words) – and we won’t be all in this together without parity of support. We’ll be on the dole along with millions of our employees.

 

As this video, ‘A short lesson in economics and justice’, from #ForgottenLTD so eloquently puts it: https://youtu.be/WgBfSgzV0lg, I’m an ‘Andrew’; some of my friends doing the very same job as me are the ‘Amanda’ illustrated in the video.

 

 

May 2020

 

 

 


1 ‘Companies with only with one employee are re-classified to the no employees category under the assumption that this will be an employee director.’ Business population estimates for the UK and regions 2019: detailed tables. Sounds like sole-directors are considered to be self-employed …

 

3

 


 

Written evidence submitted anonymously

 

Along with many others, my wife & I pay ourselves solely through dividend – because the cost of running any form of PAYE scheme is prohibitive (in real terms and also in terms of administration / bureaucracy / etc) and we never know when the business will have the funds available to pay ourselves. Indeed, we can only take an income IF the business generates enough profits to pay any dividend (after allowing for Corporation Tax / VAT / etc).

 

Instead of turning over around £130,000 a year, we are trading at a tiny proportion of this as virtually all our customers around the world have had to pause their businesses. Suppliers still need paying - as does storage, serviced offices, phone lines, etc etc

 

Unfortunately, none of the schemes offered to-date help us in any way. We are in serviced offices so have no rent relief or access to the grants from local authorities. We pay ourselves exclusively through dividend – so are not covered that way. We spent many hours filling out forms online & waiting to get through to Universal Credit & will probably get 2 payments from UC & that will be all. However, we would not have needed to go down that route had the government offered us some form of parity with other workers / self employed.

 

I appreciate that the first thing you think of regarding dividend payments is all the individual shareholders / pension schemes / etc. I am not looking at that type of business.

 

The type of business that needs the governments help, in order to be fair & equitable with the other offers already made, would share the following characteristics:

1)     Be a limited company not a PLC

2)     Be a “close” company (https://www.gov.uk/hmrc-internal- manuals/company-taxation-manual/ctm60060)

The support would only go to directors of those businesses who have received dividend payments historically (I suggest the same time frames as the self- employment scheme) who are not receiving income support via the self employment / employment schemes already announced by the Chancellor (excluding Universal credit).

 


Without this support, more & more businesses will simply cease trading – with a detrimental impact on the government’s own income stream ( for example reduced corporation tax & VAT income) combined with unemployment numbers that will be even higher than they needed to be.

 

How much would directors receive?- this would be in line with the maximum available to the other self employed already covered by the latest government scheme.

 

HMRC already know

1)     Which companies are “Close” companies

2)     The names of directors of such companies

3)     Which directors receive an income from dividend payments of these companies

4)     The names of the self employed entitled to support from the existing announcements (HMRC are writing to the individuals concerned so they will know who they are)

Surely it is therefore possible to devise a suitable scheme to support this vital section of the British economy that have so far been ignored.

 

Given that no-one has explained why the above solution cannot work, I am left with the view that HMRC do not wish to be embarrassed that a member of the public can solve a problem that they failed to solve or they view us as tax dodgers and therefore not worthy of help? Perhaps you could challenge them as to which of these 2 is the correct reason?

 

For clarity, I would also be interested to know:

1)     How many “Close” companies are there in the UK?

2)     How many of these have owner directors who have been able to take advantage of the SEISS / PAYE schemes?

3)     How many of these have successfully applied for CBILs?

4)     If the suggestion proposed can work – and if not, why not!?

If the concept I have proposed has merit, how can we persuade the Chancellor to follow through as a matter of urgency? If it doesn’t, then what can be done to give support to this sector – one that needs to be on its feet not its knees when the time comes to re-boot the economy.

 

I understand that the numbers already committed by the Treasury are huge – but the amounts involved in fixing this matter would be a relatively tiny

 


proportion of the current total & would bring fairness to those who have currently been forgotten / ignored probably on purpose.

 

May 2020

 


 

EIC0456

 

 

Written evidence submitted anonymously

 

I am a music producer and engineer who runs […], company reg no […]. I am a sole director, employ regular freelancers and virtually all my contracts have been cancelled or postponed indefinitely due to the impact of Covid-19 on the arts sector.

 

This evidence is specifically about the discriminatory 19 March cut-off which has made me ineligible to apply for the Furlough scheme for my annual director’s salary.

 

Like many sole directors, my accountant processes my annual salary at the end of March and has done so for years. Despite the Chancellor claiming director’s salaries are eligible, the current rules discriminate against thousands of business owners in my situation.

 

Directors and employees on annual salaries processed on any other month of the year, are currently eligible for furlough. This is deeply unfair.

 

Furthermore, HMRC are systematically misleading taxpayers by advising that those on annual salaries can manually override the system and apply using previous RTI submissions.

 

On 18 and 19 March 2020 I spoke with two Tier 1 advisors at HMRC, one of whom confirmed with her manager, and all three told me in no uncertain terms that the system can be manually overridden for people in my position. They referred me to the ‘technical team’.

 

The next day I was called back and told the complete opposite by the technical team, one of whom conceded they are getting ‘thousands’ of calls about this. The HMRC’s own referral model is misleading a large number of taxpayers with serious financial consequences.

 

It is particularly galling that the Chancellor personally singled out 'sound engineers' when he announced the self-employed 80% scheme in April, yet neither this nor the Furlough scheme are applicable to thousands of taxpayers in my position.

 

NB this is NOT about the government covering dividends payments; it is a completely separate issue. Please amend the rules so we can apply for at least some support to keep our heads above water; taking on debt through loans is not a long-term solution.

 

May 2020

 


 

EIC0472

Written evidence submitted anonymously

 

I am following up on my last email with regards to the extension for financial support for the self- employed. Having emailed my local MP and the Chancellor, I was directed to The Call For Evidence.

 

Firstly, I want to say thank you for creating the first 3 months of support for freelancers which I was fortunately entitled to. It was a huge relief to me both mentally and financially.

 

However, I now write with great concern and confusion as to why it has not yet been announced to extend this support for the self-employed when there has been an extension to furloughing for the employed.

 

I am a makeup and hair artist, living with my husband and baby in London, I have done this job for 14 years. I pride myself in how much I have built on my business to get where I am, starting from nothing and doing a lot of unpaid work just to get my foot in the door.

I earn a comfortable living doing the job I love, and providing my services to a vast variety of people. This includes doing weddings, News and broadcasting, TV and entertainment, Events, Films, Celebrities, and a good amount of charity work (Look Good Feel Better).

 

Since the awful breakout of the Coronavirus I am at a total loss with how I am going to support myself and family. My husband owns a small business - which as with most other businesses have ceased trading effectively.

It breaks my heart to feel so unsupported and looked over by the government in this desperate time and to see how employed workers will continue to be helped until October whilst without good reason, my support is due to end imminently. One of the most worrying factors of all this is my job can not be carried out with social distancing so I don't even have an idea of when I will be able to start working again and then how badly the industry will have been affected as a whole.

 

I have never faltered on paying my tax or N.I. I don't get statutory sick pay, I don't get statutory holiday pay, and I am fine with this but please help in this desperate and unprecedented situation so my business (and the other 5 million self employed workers) don't disappear into dust, and my family can carry on living with the equal help that the majority of employed workers are receiving. Humans are equal, this country claims to practice equality, please show us (self employed) support and dignity through this.

 

May 2020

 


 

EIC0473

 

Written evidence submitted anonymously

 

 

The Film & TV industry has been hard hit by the Corona virus pandemic. I am just one of many freelance crew who have been directly affected by the lockdown. My freelance work dried up immediately lockdown happened and it looks very uncertain when it will pick up sufficiently for me and many others to be hired again. I was quoting on a job for a foreign client to film in April, but it was cancelled when it became clear that travel would be impossible. There are so many restrictions with social distancing and although I know some filming has started they are very small shoots with only a few crew. Full production is going to be complicated, costly and some way off.

 

What problems (if any) are individuals facing in claiming support from the Job Protection Scheme and the Self-employment Income Support Scheme?

 

Without an ongoing income stream, I will be living on the last two months earnings, which as the sole provider for a family of four won’t last very long. I am concerned about what I am going to do when that money runs out. I am not eligible for Universal Credit or Statutory Sick pay, I also don’t want to take on a loan if I can avoid it.

 

I have established that I am not eligible for SEISS as due to the rules about total profit and earnings from dividends.

 

The insistence by various employers I have been working for in the last few years have required freelancers they employed to be a Limited Company. Therefore I changed from being a sole trader, (which I had been as a freelance producer for the last 35 years) to a Limited Company four years ago.

 

I think it is unfair that the self employed within Limited Companies are unable to get any support unlike full time employees who have been furloughed or sole trading freelancers who are eligible for SEISS.

 

How effective have these schemes been in maintaining employment and reducing job losses?

 

I believe these schemes have not been very effective for the vast majority of the freelance crew in the film, TV and advertising industries, as large numbers of them are self employed through Ltd Companies. For those whose profits exceed £50k there is no option of any assistance unlike others in full time employment. I have seen many frustrated comments on various forums and online groups of crew bemoaning their situations. I know of many people whose contracts were not renewed and we all fear that employment in this sector over the coming months is going to be very uncertain.

 

I am attending an online course on Managing Covid-19 Risks on Productions next week in the hope I will be more employable on future productions, but maintaining regular employment and any income during the rest of this year will not be helped by any of the schemes on offer.

 

I fully appreciate that the government cannot help everybody. I know this situation affects a huge number of people in the Film industry sector so I just wanted to add my voice to those who are requesting that the £50,000 earnings/profit cap be removed so that we can have some help like so many others in these difficult times.

 

Many thanks for reading.

 

May 2020

 


 

 

Written evidence submitted anonymously

CV

 

Over 35yrs experience in industry and international business, working in or with over 40 countries, on some of the UK’s biggest exports revenue creators.

Individual submission as I am intensely concerned about the avoidance of a deep Declining ‘L’ recession and believe my experience may be of some use.

I might also be considered highly vulnerable due to underlying medical conditions, and have experienced the SARs outbreak in Singapore some years ago.

Job Protection Scheme and Self-employment Income Support Scheme             

 

o

o

 


 

last instance the furlough money should be offset-able against tax, as this would encourage repayment.

o

o

o

o

o

 


 

o              It is not viable to withdraw support, to do so would plunge the country into a deep depression, not a recession. I support a universal basic income for the next 5 to 10 years.

o

o

o



 

 


 

caused huge scarring of businesses, and the loss of future growth opportunities, and jobs.

o

o

o

 

Other government intervention             


 


 

 


 

 


 

 

 






 

 

 

 

 

 


 

 




 

 

 

 


 

 





 

 

 

 


 

 


 

Reducing carbon emissions will be a great way of creating jobs, for example Small Modular Reactors, rail electrification, modernisation of housing.

Most companies seem to be having a positive experience of Home Working, one report says the average productivity loss is only 1% and better management and infrastructure would address that. There are reports of increased productivity too. It certainly will reduce carbon emissions, but the impact on cities could be large as office buildings fall empty.

In a few years’ time companies will have forgotten Covid and the lessons will have been forgotten. UK companies have experienced MERS or SARS within their international operations, yet how many translated that learning to their UK operations? Businesses are unlikely to be more resilient to pandemics in the long term, the economic scarring may mean they are less resilient.

Lessons MUST be learnt about high density living, and poverty’s effect on a pandemic. Planning rules need to change and stagnated areas of the country, including Green Belt and National Parks, need to be re-considered to get healthy economies within them, whilst allowing the population to spread out and breathe.

 


 

 

 


 

Written evidence submitted anonymously

Summary

         We run a bureau de change business (supplying travel money to consumers) with over 190 stores across the UK, and c800 staff.

         Our sector has been specifically excluded from the rates relief offered to the retail and leisure sector (in England, Wales and Northern Ireland),

         With a FCO advisory against travel, no revenues, and having been compelled to close, we have put 95% of our staff on furlough.

         We believe that the Governments approach of excluding Bureau de change business is not only unfair (as for instance competitors in the travel money sector have received relief) but will damage the economic recovery (jobs, tax takes, and in bound tourism).

 

 

Introduction

[…] is a travel money business that operates over 190 small stores in shopping malls and high streets across the UK. Our primary business is provision of cash (and prepaid cards) to UK holiday makers when they are going abroad. We also offer ‘in bound’ tourists conversion of their cash foreign currency into sterling – thereby allowing them to spend money in the hotels, restaurants and shops.

We also provide cash to UK customers through ATM’s that are located in the front of the stores.

Additionally we offer money transfer services, both in bound and out bound, to customers wanting to send cash to typically relatives abroad. We are in the process of re banding our business ‘NM Money’ from […] (which remains the legal entity), and investing in upgrading the ‘look’ of all the stores (and kiosks) we have.

We have expanded and invested significantly over the past 4 years, both in terms of store locations (in high footfall shopping malls), staff (up 40% in 4 years) and store numbers (up by 75+ in 4 years).

We have a headquarters in […] with c120 staff.

Questions we want to respond to

         How effective has the Government support been so far in terms of coverage and speed?

         What gaps are there for businesses within the schemes?

 

 

We believe that we have been significantly impacted as our business has fallen through the ‘gap’ in the rates relief offered to most retail businesses (and by implication we have not been covered in relation to support other retailers have received).

In fact our sector (Bureau de Change) was explicitly excluded from rates relief. (Retail Discount 2020/21 – Local Authority Guidance January 20)

This we feel is extremely unfair as many of our competitors who offer travel money (along with other things) such as the Post Office, Travel agents and Supermarkets do get relief. We

 


consider ourselves a retailer like any other, and we operate in a retail environment (with shops in most large shopping centre and high streets over the whole of the UK).

We are a long term investor in UK retail, and have opened over 75 new branches in the last 4 years, and of our existing 193 stores, 115 have been open for more than 5 years; we have being paying a significant amount in rates for many years.

To make this even more frustrating we can see that the most recent addition of the guidance dated 2 April (Expanded Retail Discount 2020/21: Coronavirus Response – Local Authority Guidance – appendix 1 point 2) has moved a number of businesses that did not get relief into a category where they now do (for instance estate agents and pawn brokers are no longer excluded as they were in the previous guidance dated January 20 p7 point 13 – see appendix 1 point 1).

The implications of on our business of not getting the relief are significant

1.      The potential loss of jobs,

2.      The inability of our business to compete with others who get relief for doing the same thing,

3.      The financial impact on us, limiting our ability to continue to invest and grow, but also compete effectively (where much bigger business get rates relief)

It should be noted that we are a UK business and the treatment across regions has been inconsistent, for example we do get relief from rates in Scotland, but not Wales and Northern Ireland who have followed the government guidance

We would estimate that applying rates relief to our sector (Bureau de Change) would cost c£5 m p.a.

As a Bureau de Change, our business is heavily linked to the travel market, and while we have a FCO advisory in place against all but essential international travel we effectively have no revenues, and the rates relief (and assess to the grants that follow) would be significant in supporting us through a difficult period.

We have been a successful business and very much intend to continue to be, however as a matter of public policy the current situation we feel is unfair and discriminatory, and acts against for our business and staff.

 

 

May 2020

 


 

 

 

 

 

 

Appendix 1 – sections from the relevant guidance

 

 

 

Point 1 - Retail Discount 2020/21 – Local Authority Guidance January 20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Removed from new guidance

Point 2 - Expanded Retail Discount 2020/21: Coronavirus Response – Local Authority Guidance 2 April


 


 

 

 

Written evidence submitted anonymously

 

No State / Government help at all, either from the various specially constructed ‘Coronavirus Support Schemes’ or the ‘normal times’ State Benefits Safety Net to replace my only income, which has been totally taken away from me by the Coronavirus and actions of Tenants who have acted in a selfish way and contrary to the Government Guidelines / Rules.

 

I am a Full-Time Landlord of One Residential Rental Property; an 8 bedroomed Licensed House of Multiple Occupation rented to Professionals ie working people.

 

The State Support System does not allow me to claim any State Help in either normal or these 'unprecedented' times. My only income is, WAS, from this one rental property. It is my full-time job, my only job and source of income.

 

Throughout the COVID-19 timeline, against Government advice, each of the 8 tenants left their household (my tenanted property) and went to another household, eg family or friends houses. They did this because they were either working from home (7 of the 8 tenants) as required by Government Guidelines or had been Furloughed (1 tenant) and they saw that as an opportunity to save money by not paying rent, but still receiving their Salary. Clearly they should not have gone into those other households under Government Guidelines! These actions have resulted in me totally losing my income and under Government Guidelines it wasn’t possible for me to have new replacement tenants into my property! (It still isn’t practically even though it is claimed that the ‘housing market has been re-opened’).

 

The Tenants actions have left me, my wife and 2 young children aged 9 and just under 2 vulnerable and with NO Income from my job.

 

I appreciate that not all circumstances could have been thought of and procedures and processes written to cover all situations, but PLEASE, can one of the various Government Coronavirus Support Schemes (Self Employed Support Scheme perhaps?) be amended to include my situation - there may be many other Landlords in the same position! I feel sure that the actions taken by my Tenants were neither anticipated nor something the Government would have been expecting especially as all of the Tenants were / still are essentially receiving their salaries. Even the one Furloughed Tenant on 80% of her salary will be receiving approximately 84% of her net pay.

 

Given the temporary laws passed to protect Tenants from eviction etc, the ABSOLUTE ABSENCE OF ANY SUPPOSRT or ASSISTANCE for me and Landlords in my position seems harsh and very unfair.

I do appreciate these are perhaps unintended consequences of the necessary health Guidelines (egs work from home, don’t go into other households etc etc) and the huge support of people and businesses in terms of Salaries and Grants etc, but non the less it has put me and my family in great danger.

 

My financial hit is £12,500 in total as at 1/6/2020, being £8,500 lost Rents plus those tenants (all of whom have broken government guidelines by going into other households) are wanting their Deposits back; another £4,000. There does not seem to have been a Quid Pro Quo, in that, Landlords couldn't and still can't remove Tenants, but the Tenants have been able to walk away with no protection of the Landlord, leaving the Landlord with reduced = or as in my situation NO INCOME!

The only ‘help’ for a Landlord has been a possible Mortgage Payment Holiday, but that is merely a deferment of cashflow but at an increased cost due to the Interest Compounding up on unpaid mortgage! Not only has the irresponsible actions of these Tenants (supposedly young working professionals) put my family into financial jeopardy but they could have spread COVID-19.

 

 

Page 1 of 2

 


 

 

 

Back to my question. Please can the Government help me and Landlords in my position with some financial income? Actual income ie money coming in so that I can provide for my family. BEING A LANDLORD IS A REAL JOB even if our UK Tax Regime through HMRC Regulations treat me and my Rental Income as ‘Other Income’. Being a Landlord with all the ever-increasing responsibilities and regulations etc is a real job, it is my full-time job and includes, but is not limited to:

I Market/Advertise the property I speak with potential Tenants

I meet potential Tenants and carry out Viewings I verify Tenants Right To Rent

I prepare Tenants paperwork, egs, Contracts, Signing for Keys, Health & Safety Documentation etc I meet Tenants on move-in day and do a move-in check/inspection with them and key handover

I clean the property, maintain the property, arrange replacements eg washing machines I ensure Regulatory Compliance egs arrange Gas/Electricity Safety & Certification

I ensure HMO Licencing Compliance, which even has to include a documented procedure of what I as Landlord would do should any Tenants have a dispute between themselves. (Sounds like HR in an Organisation)

I do Administration egs letters, keeping receipts, bank records

I prepare Accounts, to ensure HMRC Self Certification and Tax Legislation etc are complied with

I provide homes - quality homes for 8 tenants and they, like myself, create economic wealth in our Country.

Some financial help is needed, PLEASE!

 

WE (PLC’s, Limited Companies, Partnerships and Self Employed) ARE IN IT TOGETHER. But let’s not forget those who have been told by Government/HMRC to treat their job and income as something different, eh!

 

Thanking you for your time and probably patience. Stay safe. Stay healthy.

May 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Page 2 of 2

 


 

Written evidence submitted anonymously My average income situation is as follows:

There is no financial support available to me in any of my capacities:

How each scheme has excluded me:

o

As you can see, despite having low life expectancy (my life expectancy is 34 years old – I am now 35), living with a progressive and incurable disease (Cystic Fibrosis) I have worked hard to build and establish my own company.

I am not well enough to be in regular employment so rather than living on state benefits I have endeavoured to create my own work that best suits my personal circumstances. I contribute to society when I could very easily choose to live my, already challenging, life in comfort funded by the tax payer.

 


This last 4 months have been the most worrying, anxious times of my life. Time that I can ill afford to lose. Yet I have spent every waking moment worrying about how I am going to provide for my 2 children after being let down by the Treasury.

Every phone call, email and letter has offered me no solution. None of them have offered me any chance to appeal their ineligibility criteria. There is simply nowhere to escalate my issues to – the answer is always the same “unfortunately that’s just the way it is” or “I sympathise but the rules are rules”, or “if I could change things I would but the guidance dictates that I can’t do anything to help”.

I’ve been let down by the Treasury. My children have been let down by the Treasury. My health has been affected, my state of mind has been affected and my children’s experience these last few months has been worsened. All because I’ve fallen through the net due to contradictory policy and immoveable eligibility criteria.

 

 

June 2020

 


 

 

 

Written evidence submitted anonymously

[…], who has raised issues about the principle of support available for those who are not covered by the current schemes for employees or the self employed.

 

[…] is a Picture Editor who has worked for DMGT (Daily Mail and General Trust) since 2011. She is on their PAYE system, which HMRC have confirmed, although she has no contract and has always regarded herself as effectively self employed. However she is unable to claim the support offered to the self employed. Associated Newspapers have recently cancelled all her work and said they do not need her services for at least three months. They have not offered to furlough her under the Coronavirus Job Retention Scheme.

 

She has been without income since March, and has three children to support and a mortgage to pay. […] highlights that she has worked all her adult life, paying her tax and National Insurance and whilst others are supported, due to the nature of her employment she is not entitled to equal benefit.

 

My constituent highlights that many of those in her profession are losing work, are not being furloughed at a time when it is almost impossible to find alternative work but are not covered by the existing schemes.

 

Can you confirm whether any consideration is being given to strengthening the advice to firms who opt not to furlough staff?

 

As previously raised with you, it would be fairer for all workers irrespective of whether they are employed or self employed, to be paid 80% of their income. HMRC have the information necessary to do this and this would be a fairer scheme and not arbitrarily leave some workers without support and facing huge financial difficulties.

June 2020

 


 

 

Written evidence submitted anonymously

 

SUPPORT HAS HELPED MANY BUT BEEN AN ABSOLUTE FARCE FOR OTHERS LIKE ME SELF EMPLOYED 23/04/2019 = NO SEIS

 

APPLIED UC WOULDNT BACK DATE DESPITE NO INCOME FOR 6 WEEKS

 

APPLIED BBL 11/05/20 EXPECTING A PHONE CALL FROM BARCLAYS 12/06/2020 IF YOU CANT WORK THAT OUT ITS A MONTH

 

FORTUNATE ENOUGH TO BE ABLE TO GO BACK TO WORK TAKES 3 WEEKS TO GET ANY PAYMENT FROM CONTRACTOR

 

11WEEKS WITH NO INCOME WHILE I HAVE FRIENDS WHO HAVE WORKED THROUGH AND WILL BE RECIEVING 14K SEIS WHERES THE FAIRNESS IN THAT

 

FURLOUGHED WORKER LAPPING IT UP ON 80% IN THE SUNSHINE JENRICK SAYING ACCESS TO BBL 24HRS CLUELESS

MP DOESNT RESPOND PAUL HOLMES WHO I WILL HAVE THE PLEASURE OF VOTING AGAINST IN THE NEXT ELECTION

 

AND RISHI WHO IGNORES CIRCA 3 MILLION PEOPLE DISTGUSTED

 

ALL IN IT TOGETHER=ROW YOUR OWN BOAT FOR MANY I WILL NEVER FORGIVE THIS GOVERMENT AND NO DOUBT BE HANDED A HIGHER TAX BILL FOR THOSE THAT HAVE BENEFITTED

 

 

June 2020

 


 

 

 

Written evidence submitted anonymously

 

I am a self employed electrician who pays my taxes through the CIS register which means I pay 20% tax on everything I earn as I earn just like an employee does through PAYE, I have been self employed for 10 years, firstly as a LTD company but then decided to trade as a sole trader in May 2019, because of this decision the government have decided I am not eligible for the self employment grant, leaving me with nothing, the reason, the government says is to prevent fraud, how can I fraud the system when I pay tax as I go just like your standard employee, How difficult can it be to check against my UTR number to see how much tax I have paid. How can the government purposely discriminate against the self employed so much, everyone who pays their taxes should be entitled to help.

 

 

June 2020

 


 

 

 

Written evidence submitted anonymously

 

Gaps in the SEISS

 

The U.K government told me to close my business down from Monday 23rd March 2020 to go into lockdown, I have not worked since. I have had to close my business down until further notice. I am a beauty and holistic/complementary therapist in Scotland, so I will be one of the very last industries to reopen as I simply cannot socially distance from my customers. I have worked all my adult life, never claimed benefits, work full time and pay tax and National Insurance.

 

I have fallen through all the cracks for U.K and Scottish Government funding. I do receive JSA, but

£74 per week in contrast to furlough employment payments until October or self-employment payments until August is simply disappointing and it does not cover my basic family outgoing/bills.

 

I have highlighted points below:

 

  1. I have submitted a tax return in 18/19 - however I was also employed in the same tax year before becoming self-employed so my PAYE was more than 50% - so I don't qualify

 

  1. I don't get Universal credit because my partner works - his wage does not cover our basic outgoings and bills, that's why we both normally work

 

  1. Bounce back loan? Really? So you want me to get a loan and after the 12 months of 0% and once it is up              pay it back – even if it’s only 2.5%?? When the rest of the U.K are receiving grants?

 

  1. I would love to go out and get a job to maintain my income and my mental health              however I

am now looking after my 5 year old son full time since the nursery is closed and my parents can't support me with childcare to allow me to go out and find work.

 

  1. I am asthmatic so in a higher risk category              so show me a job I can work whilst social distancing

and looking after a 5 year old 24 hours a day??

 

  1. I normally work from home as a holistic therapist so I don't qualify for the £10,000 grant!

 

  1. Lucky for some (but not me) the Scottish government has set up a hardship fund for 'newly self- employed' with a one off payment of £2,000. HOWEVER, to qualify I must have registered my business April 2019 onwards. I registered in November 2018              I still do not qualify for this!!

 

  1. The unfortunate people who rely on benefits all year round, nothing changes for them, they continue to get their money.

 

  1. All whilst the employed continue to get 80% of their salary…and in most cases 100% salary as some are being topped up by their employer until October??? oh and if they have savings              they

don't need to dip in to them, that's very nice, isn't it              ? And some continue to work whilst

receiving government grants?

 

  1. Two of my friends are self-employed with successful business’s and they rent property. They will be qualifying for the maximum support from the government and as a house hold they will be enjoying an overall all income of around £40,000 in grants! While I get £74 weekly JSA?!

 


 

  1. And the best of all....once this is all over taxes will be increased to recoup the money back.              I

take it I am exempt from this since I didn't receive financial support??? Not to mention the possibility of losing my business in the process??

 

  1. Throughout lockdown I have emailed my MP and MSP asking for help for my family, with no success. I really hope a grant is produced or a basic payment for all the loyal, hardworking, tax paying British citizens who have fallen through the cracks, but have obeyed the government and closed their business, stayed at home, saved the NHS and saved lives.

 

June 2020

 


 

 

 

Written evidence submitted anonymously

 

I am a self employed childminder. I was made redundant from my employed job as a Paralegal Officer for the Crown Prosecution Service in March 2018. I had to leave my job in March 2018 as the Crown Prosecution Service wanted it within the 2017-2018 tax year. Due to an error by my manager the PU4 form wasn’t submitted to the pay department in time in March so my 3 months payment in lieu wasn’t received until April 2018 (the new tax year). Of course at the time this error wasn’t an issue.

 

I started my childminding business in September 2018, so I registered as Self Employed. I submitted my 2018-2019 tax returns and of course declared the payment from the Crown Prosecution Service and paid tax on this.

 

My childminding business was shut on the 20th March 2020 due to the covid-19 situation. I was heartbroken as well as petrified about loss of earnings for the foreseeable future. I am not a high earner, on average I earn around £300 a week before tax, but we still need my earnings. I live with my husband and our 2 small children (5 and 3).

 

We were told to apply for Universal Credit but I wasn’t eligible for it as my husband is still working. So I had my hopes on the SEISS, so when I applied online and was told I wasn’t eligible for the scheme I was totally heartbroken, the detrimental effect on mental health is alarming. I spent the day in tears, worried about us surviving, feeding the family, and paying bills, the mortgage when our mortgage break ends in June. We were told to close our businesses and to stay at home but surely this cannot be at the cost of losing my entire earnings and receiving no support? I appealed the decision to HMRC and I was told I do not qualify as I earned more in 2018-2019 from being employed. I explained in detail that I was not employed in that tax year as I left in March 2018, and I can prove this, I also have emails from the pay department back in April 2018 confirming the

 


 

 

error by my manager regarding my final payment and they were having to chase him for the PU4 form which he hadn’t submitted. I asked why there is no discretion for cases like mine, as I was not employed in 2018-2019 tax year. The payment was due to an error by my old employer and I am now being penalised and don’t qualify for the scheme. The advisor at HMRC said the rules were set out by Mr Sunak and he cannot change them. I even have a letter from my old employer supporting my appeal. HMRC won’t even look at the evidence.

 

I saw that the furlough scheme/SEISS has been extended now, surely there has to be a way to help people like me? I have a UTR number, I have submitted my 2018-2019 tax return and my 2019-2020 tax return. The only reason I don’t qualify for SEISS is due to the error by the Crown Prosecution Service which I can evidence. Surely there is something that can be done? There has to be exceptional circumstances where HMRC can overrule a decision?

 

I have been shut since the 20th March without any earnings. We can now reopen as of the 1st June but I have lost all my work as I offer wrap around care and none of my school year groups are within the list the government have issued. No parents would like day care as they are hesitant still with the virus. Not only have I lost all my earnings whilst being shut I will now continue to lose all my earnings even when you say I can reopen.

 

I suffer with Non-epileptic seizures and after a battle for 11 years I finally have had 2 years seizure free, I finally have my driving licence back. My seizures are triggered via stress, worry and anxiety and I am so worried this is going to have a detrimental effect on my health condition, trigger seizures I have fought so long to stop. I am not expecting to be reimbursed for all my earnings lost I just really need the grant that I rightly should be entitled to I wasn’t employed in 2018-2019 and can prove the payment came through late due to an error by my manager

 


 

 

 

What is really upsetting is that if my manager had submitted the Pu4 form to the pay department in the timely manner he was expected and the payment came through in March 2018 as it should have done (and as HR had directed) then I would be able to claim the grant. I left that job in the 2017-2018 tax year, so I was not employed in 2018-2019, it just seems incredibly unfair that their error has cost me any financial support.

 

Since being shut on the 20th March I have lost nearly £3000 in income. If I am shut until September without any financial support then that will be nearer £4500-5000.

 

June 2020

 


 

Written evidence submitted anonymously

 

Summary

 

Longstanding employees paid annually are refused furlough support by HMRC and can not appeal.

 

Introduction

 

There is a gap in HMRC’s furlough scheme which causes PAYE employees who are paid annually after 19/3/20, to be exempt from all support, and their employers denied the right of appeal. Many other small business employees are in this same situation.

 

We are family micro-business with husband and wife employee/directors and turnover of ~£25-30k. We’ve produced creative digital media and video since 2002. This has always been our main income and is always properly declared for PAYE & NIC. We have not taken dividends from the business since 2009.

 

Our pay periods were monthly from 2002-2013, and would have met HMRC’s criteria, but then we changed to annual pay periods to reduce payroll paperwork, cost, and simplify cashflow. Our accountants continued to file a required EPS monthly, to confirm to HMRC we were permanently on the company payroll. This approach was never raised as a problem or concern by HMRC, until now.

 

Covid-19 social distancing and lockdown measures mean we have completed all the contracts we could, and our only new contract was postponed indefinitely by the client because social distancing made filming non-viable. On government and accountants advice we put ourselves on furlough on 6/4/2020 since when the business has done no work and had no income, but it has continued to employ us on full salary on the assumption HMRC would be supporting us. The business does not have the cash to sustain this and is increasing it’s debt.

 

I have written to my MP on this matter.

 

What gaps in coverage still remain and are changes required to increase their effectiveness?

 

HMRC should retrospectively support all PAYE employees on annual pay periods in the same way they support employees on bi-annual, quarterly, monthly and weekly pay periods.

 

How effective have these schemes been in maintaining employment and reducing job losses?

 

Many micro-businesses and family businesses will suffer job losses and failure if this support is not offered.

 


 

Evidence from our accountants

 

Dear […]

 

I am the deliverer of bad news.

 

There is a major issue with the system that means that director/shareholders, who are paid on an annual basis, cannot claim JRS.

 

We have tried to make the claim for you, which was rejected. We then rang HMRC to find out why?

 

They say that as there have been no RTI submissions to HMRC before 19/3/20 (none required as no payments to employees made) then as far as they are concerned, there is nobody on the payroll.

We argued …. We said that every month we submit an EPS which is what we are required to do (this tells them that you remain employed, but are not being paid), but to no avail.

We asked that this get reviewed, but they say that this is not something that can be appealed against.

 

So, because you are paid annually, and the submission of your annual salary was submitted after 19/3/20, you are ineligible for the JRS.

 

The only recourse that you seem to have is to write to your MP to ask for a change in the rules.

 

This applies to only a handful of our clients, but I have spoken to a friend of mine that works at a much larger practice and he says that they have loads of annually paid directors, none of whom can claim JRS.

 

 

There is nothing that we or you could have known or done prior to 19/3/20 to make you qualify for JRS.

 

Thanks […]

June 2020

 


 

Written evidence submitted anonymously

 

THE ANNUAL PAYROLL SCHEME AND THE CJRS DIRECTIVE

 

I wish to share with you my experience of running a business while excluded from the scope of the Coronavirus Job Retention Scheme Directive. I urge you to take the time to read this and consider things from my perspective as I know that my situation is shared by other small business owners.

First, I recognise that the government has acted quickly to protect jobs using the ‘furlough’ scheme, and I thank you for taking this bold step to keep our country’s economy alive. However, this same scheme has allowed my clients to furlough, taking away my income, meanwhile my self-employed competitors are thriving on generous grant payments, which they are able to invest in their businesses. Furthermore, I operated an annual payroll scheme and although my last pay period was in month 12 of the 2018-19 tax year and my 2020 submission was not yet due when your announcement was made, the wording of the Directive precludes me from applying to the CJRS.

This combination of factors has damaged my business and skewed the competition going forward. Last month an HMRC call handler told me, “It is not fair, and it is not your fault”. Another told me that she had heard from many people in my situation and suggested writing to the Treasury, “so that they know you exist.” In case we have been unintentionally overlooked, I want you to know about people like me.

 

 

Who am I?

I am a translator who incorporated in 2015 to meet NHS Lothian supplier requirements. I previously operated as a sole trader but large organisations wanted to see limited company status and I wanted to limit my liability. Due to two long periods of illness my income was low in recent years (approx.

£10k salary and £10k dividends).

 

 

The translation marketplace, small language service providers (LSPs) and financial assistance during the Covid-19 pandemic

The government’s generous schemes have effectively altered the translation marketplace in ways you may not be aware of:

For the small LSP the choice of business structure is generally dictated by industry specialism and not tax advantages. Some translators take on work that carries more risk and there are potential clients who do not take sole traders seriously. At the moment, the decision to provide generous financial support to sole traders is undoubtedly the right one. But to marry the support offered under the CJRS to the inflexible furlough requirement, or to exclude support altogether due to the RTI

 


submission date requirement, means that the landscape of this industry that largely relies on the one-man-band provider is changing.

The tone used to talk about dividends – has this influenced the public’s perception of directors of small companies?

The Internet has been flooded with hateful comments about company directors who take dividends and their lack of social responsibility. Professional translators regularly assist the NHS, the Police, the Courts and individuals who are trying to access public services. Our work is so important to the public yet many of us have been unfairly characterised as corporate fat-cats. I was previously unaware of the hate directed toward directors of even the smallest companies and the popular view that we are trying to cheat the system is tiring to defend. The blanket exclusion of dividends from the allocation of support under the CJRS may have fed this view even further as the negative connotation surrounding the word ‘dividend’ appears to be growing. We did not write the rules, and we do pay tax on dividends, yet we are fielding criticism. I wish that you would make a distinction for those of us who operate a limited company structure for reasons of limiting our liability in risky environments, and those who do so to limit their tax liabilities. You have, after all, supported self- employed individuals who are earning up to £50,000 per year (and I earn nowhere near this).

 

 

The RTI submission deadline

My RTI submission went ahead as it did in previous years. There is no gap in my participation as a willing taxpayer. Yet for the sake of 10 days, I missed out on the CJRS. There was no way to know this as the Chancellor announced the details on 20 March. Annual Payroll is a legitimate scheme. I cannot understand how participants of a legitimate scheme fall outside the support being offered. Directors paying themselves a weekly or monthly salary are covered if they submitted before 19 March, and it is easy to see if those on Annual Payroll ‘existed’ last year or not.

It is my understanding that this cut-off date was used to prevent business owners putting unusually large salaries through in order to claim the maximum amount under the furlough scheme. But what about those of us who just acted like they do every year and have years of previous returns to back this up?

Under the Annual Payroll scheme, if the 12th month runs from 6 March – 5 April, an RTI submission can be sent to HMRC at any time during that period and any tax/NI deducted is then paid to HMRC by 19 April. It is not realistic to expect a company operating this arrangement to submit prior to 19 March when the standard real time payment deadline for previous years has always been 5 April. The effect of the directive has been to retrospectively alter the standard 5 April deadline but still take any annual tax/NI due.

The CJRS directive is silent on the annual scheme and therefore it is my hope that it is not an intentional policy decision to exclude such persons from the scheme.

 

 

Right of appeal – RTI submission deadline

In March I was extremely ill - possibly with coronavirus. I was unable to address my RTI submission obligations until the end of March, but may well have done so earlier had I not been ill. However, the regular parameters of the Annual Payroll scheme did not require it until 5 April. Had I been aware of the CJRS scheme requirements, of course I would have made sure it was filed before 19 March. I am

 


not aware of any route for appealing a submission date but it is reasonable to expect that single director-employee companies may have had to delay admin due to the pandemic. Small business are disproportionately affected by administrative burden which is why some choose an annual payroll scheme in the first place, and when illness is thrown in the mix we feel it greatly.

 

 

My request to you

In relation to the measures introduced, I believe the Chancellor said “we will do whatever it takes.” I have seen many innovative schemes introduced to help people and to keep businesses alive, so why is mine excluded?

I would welcome an opportunity to discuss in further detail and I hope that by sharing my situation and opinions with you here, you will consider a scheme to assist those who have fallen through the cracks that understandably occur when drafting emergency legislation.

June 2020

 


 

Written evidence submitted anonymously

 

Employee and Director, written in a personal capacity and behalf of our limited company

 

 

RE: The COVID-19 UK Job Retention Scheme (JRS) cut off date and annually PAYE

 

 

1.       Introduction: I am a Director of a small limited company which has been trading for almost 20 years. The business has a business consultancy division where I have been on the PAYE scheme here for two years.

2.       Reason for submitting evidence: Annually paid directors have been forgotten due to cut-off date for JRS if paid in the small window of 20th March and 5th April 2020.

3.       We missed the back dated deadline to qualify: The COVID-19 UK Job Retention Scheme (JRS) cut off was 19th March, as an annually paid director, our RTI submission is nil every month until March, the end of our tax year. Our HMRC records will show that PAYE payments were made in March 2019 and March 2020. Our RTI submission this year was on 22nd March 2020. With this black and white deadline set by the Government as the day before it’s announcement to prevent fraud and with no knowledge of the need to “claim in anticipation of an imminent payroll run", we missed out on the scheme.

4.       Overlooked: It is normal for company directors to be paid annually; I strongly believe this has been overlooked by the Government. The government should consider the cut-off date to be the end of the tax year (especially now that this date has also passed) or at least seek proof that RTI submissions were made monthly (including nil payments) and the previous year with payment as evidence if needed.

5.       Forgotten: This hard and cold deadline means we get no support. All the other schemes we are also not eligible for due to no business rates and not being self-employed.  We have been forgotten and left behind. We do not want more loans, simply basic furlough support to survive a basic life during this pandemic crisis. We just paid our Corporation tax bill and had a negative VAT claim this quarter as there is no revenue coming into our business due to this crisis.

6.       Left behind: Basic support compared to no support, is all I ask for. I have fully paid all taxes and NIC for 20 years as an individual, and now I need support, where the Government said no one will be left behind, I have been forgotten and left behind.

 

 

Many thanks for your time.

June 2020

 


 

Written evidence submitted anonymously

 

I am making this statement to highlight the unfair treatment of the self-employed by the government during the lockdown.

 

There are various groups within the self-employed community who have fallen through the cracks when it comes to government support. My particular situation has come about because I received income over a couple of years for one contract via PAYE.

 

The reason I have asked for anonymity is simply because I mention in my evidence what my recent earnings have been – I don’t really want that information made public. I am, however, more than happy for the other parts of my evidence to be attributable to me.

 

Thank you

 

 

 

 

I was made redundant in 2012 and have been a freelancer/self-employed writer and editor since 2013. I have always paid my taxes on time and have never done any work “off the books”.

 

I have been paid for all my work by submitting invoices, with just the one exception. Between 2017 and 2019, I had a fixed-term, part-time, zero-hours contract in the public sector, with a district council. For that contract (and only for that contract), I was paid via PAYE.

 

All the other work I did during that time involved me submitting invoices as usual.

 

Before the lockdown, I was making regular 230-mile overnight round trips to see my elderly father, who has dementia. So although I did manage to do some other freelance work during this period, I didn't do as much as I might otherwise have done. As a result, during 2017-19, more than 50pc of my earnings came from that contract that saw me paid via PAYE.

 

I therefore do not qualify for the self-employed support scheme, even though I have been self- employed for seven years, and the only thing that happened with that council contract was the method of payment was different from how I'm normally paid.

 

(My average earnings over the past three tax years were a little over £12k a year.)

 

I fail to see how the government can claim I have not remained self-employed other than through a very narrow, technical definition.

 

To make things worse, the government has alluded to the fact that self-employed people are in a privileged position because we benefit from a lower tax and NI regime. It is ironic that I am now being denied self-employed support because of my PAYE work that – according to the government’s own logic – saw me losing the tax and NI benefits that I have apparently benefited from by being self-employed!

 

My work dried up completely as soon as the lockdown was announced – I didn’t have a penny of income through April or May.

 


I see no good reason why the self-employed support payments cannot be made to people in my position. They can always be clawed back through the tax-return system at a later date if a certain threshold of income is subsequently achieved.

 

I subsequently applied for Universal Credit but was denied that because of my savings – savings that I had put aside to help pay for my father’s care should he need to go into a care home.

 

It’s important to emphasise that I am not on the breadline. I am lucky enough to have those savings to fall back on. But this is not the point. Employed people sent home on furlough aren’t being means-tested. Self-employed people who do qualify for the government scheme aren’t being

means-tested – indeed, some of them have been given financial support while continuing to work as normal.

 

Yet the government (including the prime minister and the chancellor) continue to say things such as “we’re all in this together” and “the government has put its arms around every worker”. We are not, and it has not.

 

June 2020

 


 

 

Written evidence submitted anonymously

 

First, I want to thank you for your important work holding the Treasury to account on behalf of the many tax-paying freelancers like me who remain unsupported by the government's Coronavirus income support schemes.

 

We have been left: unable to meet basic living costs, stripped of any financial security we've worked so hard to build up over many years, and facing a desperately precarious future - both for our businesses and our lives.

 

I previously wrote to you by email on 30 March and 16 April and have now been advised by your office to submit to the Committee via your online portal.

 

SUMMARY OF THE ISSUE:

 

The Chancellor announced income support packages for freelancers on 26 March 2020. That is when it first came to light that there are many tax-paying freelancers in need of support who have fallen through the cracks.

 

The government schemes apply to Employees or Sole Traders, not to ALL freelancers in need. There an estimated 700,000 media freelancers like me, and an estimated 2 million one-person limited company directors like me.

 

More than two and half months on, the government has still not done the right thing and failed to address the gaps we are falling through, despite their role to protect and represent us all, and their promises to leave no one behind.

 

I am left in a state of fear and despair by the government's continuing inaction. I just don't understand how we can continue to be excluded and denied fair and equal support in this time of need, and I would like to ask the Treasury Select Committee to help urgently put this right.

 

MY SITUATION:

 

I am a TV freelancer operating as a one-person limited company director. I make a significant contribution to making Britain's factual TV industry the most successful in the world. I pay myself via a nominal PAYE monthly salary and dividends taken from my company - i.e. money I EARNED by working on projects for TV production companies and channels.

 

TV productions have mostly ground to a halt during the lockdown. There is no work available for me. I am currently only able to furlough for 80% of the PAYE Salary element of my remuneration. This would give me £575.20 per month. This will not cover basic monthly living expenses in London. It also falls far short of the max £2,500 grant available to everyone else.

 

WE ARE BEING DISCRIMINATED AGAINST:

 

Meanwhile, our sole trader peers will receive 80% of their profits - regardless of whether they are able to continue earning from their work or not. And our

 


 

employed peers will also receive 80% of their income - regardless of how high their salaries, including the very rich.

 

For both groups, their life / pension savings will remain intact.

 

Other groups are exploiting loopholes, e.g. second home owners claiming

£10k grants for holiday homes. The government is turning a blind eye by simply urging that people should follow the "spirit of the rules", without taking any action to close such wasteful and unfair loopholes.

 

Meanwhile - in stark contrast - they continue to claim it is "too difficult" to help those of us who earn their basic income primarily through dividends, or that it is "too open to fraud".

 

Is our government protecting big business owners (whose pockets will be protected with furlough money, rate reliefs and bailouts, regardless of how rich they are) and second-home owners (who are receiving grants for the privilege of being wealthy enough to own more than one property), at the expense of those of us ordinary workers on modest incomes who face financial ruin?

 

Many of us (including me in my previous emails to you and summarised below) have made the clear case for how paying ourselves through dividends from our own businesses is NOT "tax-dodging" as some members of the public and politicians have claimed. It has for many years been a negligible tax advantage, clearly offset by the substantial lack of employment rights and insecurity of being a freelancer and micro business. I have explained more below. We operate firmly within the letter and spirit of tax law.

 

In any case - when did it become acceptable for the Treasury to retrospectively PUNISH a group for adhering to lawful tax rules that they no longer favour? OR to base financial policy on (misplaced) moral indignation?

 

Even if they continue to believe we have unfairly paid less tax - despite the clear evidence provided - they could offer a proportionately reduced support package. So how is it acceptable to offer NOTHING or an amount so minimal that it will spectacularly fail to stave off financial ruin?

 

This cannot be fair or right.

 

I will also mention here that it has been predicted that women and ethnic minorities stand to be particularly hard-hit by the fallout of the coronavirus lockdown. I am an ethnic minority female and - having dealt throughout my career with the well-researched and well-documented disadvantage of being a female, a minority, from a modest background, in the TV industry - this feels like yet another kick. It's simply not fair, having striven to make something of my life and contribute significantly to the TV industry and to society, that I am yet again being discriminated against in another way - because of an

 


 

unfounded bias against my fully legitimate business and tax set-up - and being denied adequate and equal support.

 

The government is discriminating against people like me who are already particularly vulnerable to the effects of the pandemic and lockdown. They are making it clear that they do not care whether I professionally or personally survive. I am finding this deeply distressing.

 

LATEST MEASURES STILL DO NOT HELP ME:

 

Most recently, the BOUNCE BACK LOANS have been announced. The Chancellor and many others are lauding BBLs as a "solution" that plugs the gap for those of us excluded from grants. However, this is a disingenuous and dangerous misrepresentation.

 

BBLs are business loans, not personal loans. So if I take one, it will be paid into my limited company business bank account. If I use it for business costs, I will not be charged any interest rate, and a favourable rate beyond, so for many, it will be welcome as a no/low-interest business loan.

 

HOWEVER, If I take that money out of my business account to pay myself as the Director / Employee of my limited company in order to pay my bills (because I am not earning anything during lockdown), I will be stung with TAXES on that loan money.

 

That is because: the usual tax rules on a Director withdrawing money from their business for personal use will apply when we do our next corporation tax files.

 

The money we use will either constitute a Dividend (only IF there is any profit) taxed at 7.5%. It might potentially be possible to artificially increase my PAYE salary in order to withdraw the loan money to pay myself, however these loans must be used for the economic benefit of the company not the individual and in any case this would attract income tax.

 

My accountant confirms that - in my situation - any loan money I withdraw from my business account to pay bills would constitute a Director's Loan. This means it will be repayable into the business bank account WITHIN 9 months. For many it's uncertain / unlikely we'll be fully back to business and able to repay the loan in full within 9 months, especially if we've had the punitive hit of being excluded from adequate grants all this time. After 9 months, it would incur a whopping Director's Loan tax of 32.5% of the outstanding balance.

 

I only discovered this by asking my accountant. Many will be unaware of this and will have a nasty surprise when they file their corporation return.

 

So for limited company directors who are not earning, are excluded from any / adequate grant support and need the money to cover basic living

 


 

costs, the Bounce Back Loans are NOT a 'free loan' and will create FURTHER DEBT.

 

Furthermore, the Treasury will be PROFITING from us by receiving extra tax revenue from us for the privilege of taking out a loan to pay our bills, even though they are NOT giving us any / adequate grants.

 

It is irresponsible and perverse for the government to hail this as a "solution" for those of us excluded from grant schemes.

 

One other measure announced at the start of May is LOCAL AUTHORITY DISCRETIONARY GRANTS for businesses excluded from other schemes.

 

However, it is becoming abundantly clear that while these grants are labelled "discretionary", guidance from central government to local authorities stipulates that businesses with formal premises must be prioritized.

Furthermore, this scheme has been opened to those already eligible for SEISS, but EXCLUDES me yet again.

 

Many other freelancers are reporting that receiving a discretionary grant has become a "postcode lottery" and this is causing yet more distress.

 

THE GOVERNMENT NEEDS TO ACT NOW TO DO THE RIGHT THING:

 

I feel it is critical that the Chancellor and Treasury are pressed further on the following critical questions:

 

  1. How can the government justify applying such broad, blanket grants to cover even those who have not asked for it and may not need it and turning a blind eye to well-reported loopholes that enable claims by the wealthy - thereby acting WASTEFULLY - whilst knowingly continuing to deny those who are calling out for help? Will they now find an equitable and just solution for us all?

 

  1. The Chancellor has repeatedly said it "can't help every business and every household" but they must be interrogated on this. While it's understandable some would fall through the cracks at first,

once alerted to specific gaps that are throwing significant numbers of us into hardship, can they provide, in public, a genuinely justifiable reason?

 

  1. When provided with the case and various solutions for equal support for all who need it - including your Chairman's excellent open letter of 8 April to the Chancellor calling for all workers to be supported - the Chancellor simply repeats all the measures being offered to OTHERS. He thereby side-steps the actual questions he is being asked about those falling through the net.

 


 

We've all heard the disgraceful words of Chief Secretary to the Treasury Stephen Barclay when he spoke to the Treasury Committee and characterised people like me as disposable "trade offs".

 

When will the Chancellor and Treasury stop casting us as liars, fraudsters or tax-dodgers - despite so many of us explaining and proving otherwise - and when will he do the right thing in response to our plea for help, and treat us with basic dignity and respect as actual HUMAN BEINGS?

 

MYTHS ABOUT OUR PAY AND TAX:

 

Many of the key facts of this issue have become obscured in public debate by misperceptions and inaccuracies and it is important to clarify these:

 

Unfortunately, in current debate, I am often being lumped together with high- earning individuals who work for a single employer yet run as limited companies with the purpose of minimising tax.

 

However, I am NOT subject to IR35 as I work on short projects (a few days to a few weeks) for multiple completely separate companies. I also DO NOT earn anywhere near the £217k per year figure cited by the Chancellor to justify our exclusion - only a fraction of that. I was TOLD to set up as a limited company by my accountant - legitimately WITHIN HMRC's current tax system

- as many clients in the TV industry require it in order to hire us freelancers.

 

Despite public and political comments about us being "tax dodgers", I DO pay all my taxes: I pay Corporation Tax on profits, then I am also taxed a second time - Dividend Taxes - on money I withdraw from my business bank account to live on. Much of the current discussion ignores that fact and WRONGLY assumes we pay no or minimal tax on dividends.

 

There IS a very modest tax advantage to operating as a limited company, but with rising dividend taxes over the years, it is negligible. And the price we pay for that modest advantage is significantly fewer employment rights than everyone else, including my Sole Trader peers, i.e.: no paid holiday or bank holidays, no pension contributions made for me, no sick pay, no cancellation fees, no legal protection, no pay for additional hours worked (i.e. not just no overtime, but NO PAY at all beyond a regular 5-day week for the 60-100 hour weeks I have regularly worked through my 20-year career, and I live with huge job and financial insecurity all year round. There is no safety net for me at the best of times.

 

It is clear - if the actual facts, rather than myths and misperceptions are used - that I operate firmly within the letter and spirit of tax law.

 

To further prove this, tax experts have - in recent weeks - published several income and tax comparisons between sole traders, limited company directors and the employed, e.g. this one:

 


 

 

 

Macintosh HD:Users:suzies:Desktop:103858210_1567452233427998_916731766947995362_o.jpg

 

 

THE STICKING POINT:

 

As limited company directors pay themselves primarily through dividends taken from their own business, the Treasury has claimed that it is too difficult to differentiate between those dividends taken from their own companies as income, and dividends some might receive on passive holdings / investments in other companies. However, many trade bodies, including IPSE, BECTU,

Directors UK and others have suggested many ways in which the distinction can be made.

 

However, the Chancellor and Treasury representatives have so far not seemed to engage with the several solutions offered. Furthermore, when questioned, they simply keep repeating what they ARE doing for the rest of the population. This is not good enough as I will NOT be adequately helped by ANY of the current grants and benefits:

 

I can furlough myself and receive 80% of my Director's Salary, which is a nominal amount that will NOT cover basic living costs. But whilst furloughed, I am not permitted to seek any other work to try to earn the rest of the money I need to cover basic living costs. This puts me at a huge, unfair disadvantage from sole traders who have been guaranteed a full 80% of their income AND can continue to work.

 

The rest of the available support is simply DEFERRING payment. Mortgage holidays will impact on interest in future and will have to be repaid at a later date. Loans will have to be repaid and - as I've explained above - have hidden taxes if used to pay basic living costs. Deferred tax bills will loom again.

 


 

I do not want to get mired deeper into debt and face massive bills in a few months' time when I don't know how or when the jobs market will recover. I need a grant like everybody else.

 

VIABLE SOLUTIONS:

 

There are several solutions that are perfectly possible for the government to enact. Saying "it's too difficult" or "would take too long" or "would risk fraud" is not good enough. A fair and just solution MUST be put into place urgently:

 

1.  EXTEND THE JOB RETENTION SCHEME TO COVER NOT JUST DIRECTOR'S SALARY BUT ALSO DIVIDENDS

 

Many trade bodies have suggested viable ways to do this. E.g. show dividend vouchers, use our company tax returns, get our accountants to submit our info to HMRC, or sign a declaration under a "pay now, claw back later" which will impose penalties later on those who try to cheat the system. I could also provide bank statements showing the money that I have transferred out of my business bank account into my personal bank account - which will tally with the dividends shown in my corporation tax accounts. This would give us fair and equitable treatment to our sole trader and employed peers.

 

Sole traders are able to claim by self-certifying that their income has been affected by the lockdown. So why can't we also self-certify? In fact, the whole freelance tax system is based on self-certification, whether via an accountant or not.

 

Also, the Treasury is not accepting us as genuinely self-employed and not recognising the dividends we draw as legitimate income. However, those dividends are considered perfectly legitimate income for the purposes of mortgage applications, benefits claims or income protection insurance schemes. So why not for the Chancellor and Treasury?

 

For those of us who have had to go ahead in the meantime and claim 80% of our nominal PAYE salary - for fear of not getting anything else - we must still be able to claim for the dividend portion of our income as and when the net is fairly widened to give us parity with our sole trader and employed peers.

 

2.  A NEW SCHEME FOR ONE-PERSON LIMITED COMPANY DIRECTORS THAT PROVIDES A FIXED MONTHLY GRANT TO THE DIRECTOR

 

If the government does not wish to be seen to u-turn on the dividend issue for any reason, they can provide a fixed monthly PERSONAL GRANT to one- person limited company directors.

 

A blanket grant like this would require far less costly and time-consuming processing by HMRC - I understand this slightly more complex workload is another obstacle cited by the Treasury to helping those of us who've fallen through the gaps. HMRC Records would confirm that a named limited

 


 

company director with a specific national insurance number was not claiming any other grant.

 

Another advantage is: we would also be allowed to continue seeking post- pandemic work and maintaining our businesses during the lockdown - in line with our Sole Trader colleagues. It would also go some way to covering basic living costs and genuinely ensure that "no one is left behind".

 

3: WIDEN ELIGIBILITY TO PROVIDE A ONE-OFF £10K SMALL BUSINESS GRANT TO ALL LIMITED COMPANY DIRECTORS

 

Alternatively, if I am NOT considered a "genuinely self-employed" individual, then it should follow that I AM considered a business and eligible for a one-off small business grant. However - as I'm not in retail, hospitality or leisure, I'm currently excluded. How can it be that the Chancellor and Treasury consider limited company freelancers as NOT self-employed, NOR a business?

 

4.  A GRANT OF 80% (TO MAX £2,500) OF COMPANY PRE-TAX NET PROFITS

 

Alternatively, I could provide my company accounts, which show what I - as a one-person limited company - have earned in pre-tax net profits. Again, HMRC would know from their records whether a named limited company director with a specific national insurance number were receiving a grant elsewhere as an employee or as a sole trader, and thereby prevent fraud or wastage.

 

As you know, a related issue is the £50k profit ceiling currently set for freelancers - which will have a devastating "cliff edge" impact on those earning a little over that but are still in need of help.  I would suggest that there should be tapered grants. This would give at least partial parity with our Employed peers who can receive furlough grants up to £2,500 no matter how high their salaries.

 

5.  ALONGSIDE ABOVE SCHEMES, WIDEN ELIGIBILITY AND AMOUNT OF UNIVERSAL CREDIT

 

The rest of the population receiving grants - sole traders and employed - DO NOT have their savings taken into consideration in receiving

support. However, I am not eligible for UC due to my savings.

 

I have set aside money to cover pending tax bills. And I have also clawed together modest savings over many years towards retirement - by making sacrifices - as I have no employer contributing to a formal pension for me. If I am forced to completely exhaust these modest savings now, I will have no means of meeting deferred mortgage and tax bills at the end of lockdown, and will be stripped of all future security, having a devastating impact for many years to come.

 


 

In any case, I have checked on several online benefits calculators - as recommended on the government's website - and EVEN IF I had zero savings, with the current nominal furlough amount I receive of £575, I would be eligible to a tiny £47.19 per week in total benefits. That's £204 per month. Clearly, that is nowhere near enough to cover my mortgage, basic business costs, utility bills and food.

 

WHY THE GOVERNMENT'S TREATMENT OF US IS SHAMEFUL AND WILL WREAK DAMAGE FOR YEARS TO COME:

 

It is important to re-state that: the purpose of the Covid-19 income support grant schemes is to RECOMPENSE individuals and businesses for loss of income during the government-imposed lockdown. I am not asking for a HAND-OUT. I am asking to be RECOMPENSED just like everybody else.

 

Yet I have been forced - for the past eleven weeks - to spend my days writing letters, signing petitions, analysing our situation, researching potential solutions, following the work of campaign groups and inquiries. Forced to justify my existence and beg for a lifeline. It seems I am not considered by our government to have any value - either as a person or a micro-business - that's worth protecting like every one else.

 

Over the past 11 weeks, the Chancellor and Treasury have also been alerted to the gaps in their schemes and provided with viable solutions by hundreds of thousands of other freelancers like me, several bodies representing us, journalists, and political figures across parties. Yet the Chancellor and Treasury have not yet provided a genuine and meaningful response. They continue to ignore me, and others like me.

 

They fob us off with stock answers about the help available to OTHER PEOPLE, not us. They tell us it's "too difficult" or "too open to fraud". But other groups ARE allowed to self-certify, and other schemes are equally open to fraud. The insinuate that we are "tax-dodgers" - despite the evidence that has been clearly put forward - or that we are not genuinely in need and perhaps have secret stashes of cash squirrelled away.

 

But I am a HUMAN BEING. I am now haunted day and night by the prospect that I will run out of the meagre savings I scraped together towards my pension and tax bills. I am rationing what I eat to make food last longer. I am terrified that - in the weeks and months to come I will run out of money altogether. I am scared I may lose my home. I feel deeply depressed at being discriminated against like this.

 

How is it possible that I - a successful, professional, law-abiding, long- term tax-payer - am not treated as a HUMAN BEING by our government?

 

I have colleagues in similar roles to me who hadn't got round to setting up as limited companies, who pay similar tax and some who earn MORE than me who are now claiming £2,500 per month and are still able to work.

 


 

The government is engineering further iniquity in our society - creating yet another class of "haves and have-nots". These man-made fault-lines will have repercussions for years to come.

 

I am following campaigning groups for excluded freelancers and every single day I am reading of their utter despair that matches mine. So many freelancers are being forced to give up their homes and move back in with elderly, panicking about how they will feed their families, contemplating ending it all.

 

And they are sharing online the letters they've received in response to their pleas from their MPs or government departments. They are being told "it would not be right to provide support based on dividends as these are returns on investments" - even though we couldn't have explained more clearly that these dividends are money we earned from our jobs and we've paid corporation and dividend tax on them.

 

One freelancer was advised by her Conservative MP to "visit the food bank" in a neighbouring town. The freelancer calculated that the market value of the food she would receive in a pack from that food bank would be less than the cost of petrol for her to drive there and home, and would also break lockdown conditions at that time. This is an absolutely shameful response from a government representative.

 

CONCLUSION:

 

I have tried my very best to express why it is the only fair and decent thing to do to support ALL of us freelancers at this time, to clear up the myths and misperceptions clouding this matter, and to highlight the devastating current and future impact if the Chancellor and Treasury continues to treat me and others like me as disposable "trade offs".

 

I would be very grateful if you could consider my experience and suggestions and push the Chancellor and Treasury to urgently provide critical and equitable support to me - and all the others like me - at this difficult time.

 

June 2020

 


 

 

 

 

Written evidence submitted anonymously

 

Help for Ltd Company Directors

 

I am a Locum Optometrist operating through a Ltd Company as advised by my accountant.

 

All my clinics have been cancelled.

 

I have had NO income since lockdown because of COVID-19.

 

I am only entitled to the £575 a month through furloughing myself via the JRS, as my dividends are not being considered.

 

I do not wish to take out loans, when I have paid all my taxes.

 

Once the mortgage holiday is over, I will not be able to pay my bills and my mortgage and support my family.

 

I am not entitled to a discretionary grant as I don’t have premises.

 

The Government has said that "under current reporting mechanisms it is not possible for HM Revenue and Customs (HMRC) to distinguish between dividends derived from an individual’s own company and dividends from other sources, and between dividends in lieu of employment income and as returns from other corporate activity".

 

My representative body, The AOP (Association of Optometrists) disagrees with this claim. HMRC Has the information to isolate dividends paid to owner operators via the submission of iXBRL statutory accounts for Limited Companies and the details held at Companies House. Close Companies could make submission for eligible shareholders as they can for furloughed employees.

 

There is a large group of individuals receiving no support merely because they are paying themselves through dividends rather than salary. If they were employed, they would get the full amount.

 

This seems completely unfair and biased against a hardworking and valuable sector of the economy.

 


 

 

 

 

June 2020

 


 

 

Written evidence submitted anonymously

 

Firstly, thank you for keeping the lack of parity in support for small limited company directors at the top of the agenda – as noted in Oral Evidence session on 9 June 2020.

 

It is more than frustrating that HM Treasury and HMRC still seem to be sticking steadfastly to their line that extending support to cover Small Limited Company directors’ Dividend Income is too complicated; they don’t have the data; it would be open to fraud and error; would take too long; ‘fairness’ to the taxpayer; even, that it would jeopardise other support schemes – as referenced by the correspondence from Stephen Barclay (dated 22 May 2020, published by Treasury Select Committee on 10 June 2020)

 

Both Stephen Barclay’s response and the revised government response to this petition (5 June 2020): https://petition.parliament.uk/petitions/310515 are wholly inadequate.

 

I was also disappointed by Torsten Bell’s response during the 9 June evidence session to your question about self-employed dividend income (Q622).

 

True, the dividend income section of the Self Assessment Tax Return lumps together all sources of dividend income. But, as I’ve already evidenced in my previous evidence submission on 25 May 2020, the Tax Return Schedules submitted with the Self Assessment Tax Return by our accountants itemise both source of all dividend income and shareholdings. I’d love to know what PLC would give an annual dividend return of £20–25K from a single share (the legal entity of a sole-director limited company).

 

On the question of ‘fairness’ raised by Torsten Bell, I don’t want or need the £50 or so dividend income I earn from other shareholdings compensated. But the Dividend Income I receive from my own company is my Trading Profits – derived entirely from my labour – just the same as the Trading Profits of the Self- Employed Sole-Trader.

 

Linking data and fraud risk

 

Debunking HM Treasury and HMRC claims

In the meantime (on the following pages) I have put to use my currently under-utilised design skills to visually debunk the governments claims, demonstrate the lack of parity in support for Small Limited Company Directors, and the potential impact on employment. Millions could be joining the dole queue if small company directors – “Our smallest businesses … the backbone of our economy ...” (Rishi Sunak, Chancellor, 27 April 2020) – are not supported.

 

Solution: Pay Now, Claw Back Later

June 2020

 

 

1

 


#Forgotten Ltd

"You have not been forgotten. We will not leave you behind.

We are all in this together." (Rishi Sunak, Chancellor, 26 March 2020)

The Government claims that 'self-employed' directors' Dividend Income can't be included in the Coronavirus financial support packages because:

•  they don't have the information

•  it would be too complicated

•  it would take too long

•  HMRC can't distinguish between dividends from own company and dividends from other shareholdings

•  it would be open to fraud and error

"The Government has announced an unprecedented package of support for those adversely affected by Covid -19, including support available to owner-managers operating under a Limited Company." (HM Treasury, response to Petition: Coronavirus Support Package for Directors/Shareholders of small Limited Co's, 5 June 2020)

 

 

A few graphics to debunk those claims:

 

Coronavirus Grant Support: Lack of parity Income support

 

Employee

 

 

Self-Employed

 

 


 

Furloughed Director

 

 

Non-Furloughed Director I

 

0


*based on £719/m ont h PAYE (2079/20 Secondary NI Threshold) and including % redu cti on in Government CJRS grant from September

 

 

 

5000              10000              15000              20000

CJRS/SEISS income support March to Oct ober 2020 (£)

 


 

Fixed business costs

 

 

 


(J)

(!J

(J)

E E

0

J:: 0..

bOai

-  ·c::;

_Y.              L

L              (1)

o

E


Rateable Value <f 5l k

 

 

Rateable Value <15K

 

 

Discretionary Grant

 


u0                           

 

No commercial premises I

 

0              5000              10000              15000              20000              25000

Grants for ongoing fixed business costs(£)

2

 


Small business turnover, costs and government support

"The Se lf - Em  ploym ent  Incom e Support Scheme (SEISS) is intended to suppo  rt  individuals who

rely primarily on their trading profits from self-employment as their main source ofincome

... Income from dividends is a return on investment in the company, rather than wages"

(Jesse Norman, Fin anci al Sec ret ary t o t he Treasu ry, on 11 May 2020)

 

 


Sole-Director Ltd Company

Annual Turnover f50k


Self-Employed Sole-Trader

Annual Turnover f50k

 


 

 


 

Corporation Tax


Tax              ts

 


 

 

 

 


 

(

Trading Profits


In com e derived from business


\

PAYE

Employment costs


Income derived from business

(

 


AFTER Tax

 

Corporation Tax Return


 

Sole-Directors Dividend Income is a return on their labour, NOT a return on capital investment

Coporati on Tax


Trading Profits

 

 

 

 

 

 

 

 

 

 

r


 

NI              □N I

■

 


 

DiviC              Tax

Tax


■D Divid end Tax


Income Tax


Tax


■  in comeTax

 


 

 

Take Home Pay

(

Divi dend Income after tax


Un-u sed Tax All owa nce

 

 

TaxablelDnivaidiver.idaAuftaer1J ax

PAYE in come

 

 

-              Costs

income


 

Take Hom e Pay

(

Income after tax


Tax All owa nce

 

 

Income after tax c osts

 


 

Se lf- Assessm ent Tax Ret urn              Self- Assess m en t Tax Return

 

" Peop le who pay themse lves only, in eff ect, by dividends. As I pointed out earlier, a sm a ll percentage of people get the majority of their incom e in that way, on which, in effect, they pay only 7.5% tax" (Therese Co ff ey, DWP,4 May 2020)

 

 

■D Coporat ion Tax

 


 

 

 

 

 

 

 

 

Inc


Divid end Tax

D Un-u sed Tax All owance

Taxable Dividend After Tax

Flcome support grants

PAYE not covered

 

 

income

ed


 

 

 

(

Income


 

 

 

51%

 


NOT  SUP              NOT SUPPORTED

 

 


Furloughed Director:

Cannot continue working


Self-Employed So le-Trad er:

Can continue working

 


 

3

 


What data does HMRC have?

"HMRC would be forced to rely on all sort s of information they would not be ab le to verify very easily ." (Boris Johnson, PMQ s 3 Jun e 2020)

 

 


 

 

PSC


Con firm at ion St at em ent

An nu al Re tu rn, inc lu di ng Persons with Signi fi ca nt Con tr o l, subm it t ed to Co m pa ni es House

(Com pa nies House makes much of the governm ent 's commitm ent to open dat a)

 

Statutory Company Accounts

Su bmitt ed t o HM RC wi th Corpo rati on Tax Retu rn

 


 

 

 

Corporation Tax Return

 

 

 

Self - Assessm ent Tax Return

Dat a subm itt ed t o HMR C in cludes:

• Tax Sc h edu les de tail sou rce of all di viden d inco m e

• SA10 2 (PAYE in co m e) st at es Directo r of Com pany

 

 

PAYE

 

 

 

Employee              Self -Employ ed              Director Data submitt ed to HMRC

 

 

 


How many small limited company directors are falling through the cracks?

"We wi// support jobs, we will support incomes, we wi// support businesses, and we will help you protect your loved ones.

We wi// do whatever it takes". (Rishi Sunak, Ch


■  Large Businesses

■  Med ium Business

■

 


 

 

 

 

 

 

 

Large

(>250 em ployee s)


Sma ll Businesses

 


 

 


Companies (UK Legal Status)


Employment

 


 

Reference : Business pop ulat ion est imat es fo r the UK and regio ns 2019: det ailed t ables (Table 3: UK Legal St at us), publi shed by BEIS]

 

"Our smallest businesses are the backbone of our economy and play a vita/ role in their communities." (Rishi Suna k, Chan cellor, 27 April 2020)

 

Disclaimer: I'm a d esigner not an acc ount ant.

Thi s dat a is well info rm ed, but I am not

qualifi ed to calculat e eff ect ive t ax rat es, or verif y offi cial st at ist ics.

4

 


 

Written evidence submitted anonymously

 

Introduction To My Business:

 

[…] is an established business in both the wedding and corporate event industry, The business was started in […] by my now late brother.

 

I took over running the business on the NEA scheme following the death of my brother who committed suicide after the death of my father from Cancer again in 2017. Four years prior to 2017 I’d been registered as my Dad’s full time care giver and I was in receipt of Carers Allowance, Following my Dads death I was moved onto Universal Credit and then subsequently when my brother took his life I took over the business under the New Enterprise Allowance scheme and I was considered to be a new start up business. I typically followed the expected pattern/ business plan of any business and in year one I made a loss (2017/2018) In year two (2018/2019) I made a small but modest profit and 2020 would have been my third year where I’d of been in profit again.

 

My Personal Circumstances:

 

I live alone in […] in a shared ownership flat, I have a 25% stake and pay rent and management fees to a housing association on the remaining 75%. My mortgage is with TSB and costs me £186 PCM, My service charge and rent on the 75% is £381 PCM.

 

I also have a zero hours PAYE job within a mental health care setting for […].

 

My office for […] is home based and I rent X3 20ft shipping containers in a yard at[…] which is costing me £360 PCM and classes as non rateable, These units house all the business equipment.

 

How Covid 19 Has Impacted My Business:

 

Since lockdown and social distancing the vast majority of my work in weddings or events has either cancelled outright or postponed until 2021 meaning I have no business income from […] until March 2021 at present, To date the amount of lost income from postponements / cancellations amounts to just under £22,000 which is going up daly as more and more couples choose to postpone due to Covid restrictions.

 

My Current Situation:

 

Unfortunately at the start of March I could see the financial impact this was going to have on my business so I applied for Universal Credit and I was awarded the basic amount of £409.89 a month plus the rent side of my shared ownership leaving me to find the £186 a month mortgage. I then started to experience Covid 19 symptoms and had to isolate for 14 days which meant I couldn’t do any work at my zero hours employment either, They took me off the rota and haven’t been able to add me back on since so the only income I get is my Universal Credit.

 

Because I invested in the business to grow it and because in 2017/18 I earned more from PAYE I was told I was ineligible for SEISS because of the 50% rule.

 

My business is home based with non trading storage units so I didn’t qualify for any grants under the business interruption scheme, I then had a glimmer of hope with the discretionary grants that my local council of Northampton are managing so applied on Monday 01/06/20 to be promptly declined saying as I work from home I don’t qualify.

 


 

I’ve tried to obtain a Bounce Back Loan from TSB whom I hold a personal account a business account and my mortgage with, TSB declined my first attempt saying the figures were wrong (Not that they were) so I attempted a second application which they declined saying “I don’t satisfy their lending appetite” when I rang during a 2 hour phone call to challenge this and find out what this meant I was confronted by X3 different very unhelpful staff the third actually lied on the phone (Hopefully Recorded) and said my application was successful and that I’d get an agreement sent for signing. I waited for 3 days despite being told it would take 24 hours for the agreement to reach me and called again, I was basically accused of being a liar and was told I was wrong and had it wrong. When I asked for an explanation I was refused and treated appallingly by a rude business relationship manager at TSB (Complaint Started), since this I tried a third attempted but TSB have just ignored that.

 

I’ve tried opening further business accounts with Starling Bank who refused me an account and with HSBC for a feeder account, HSBC took my details around 4 weeks ago and said they’d be in touch about an account opening so I could try and apply for a BBL through them and since then I’ve heard nothing from HSBC about my attempted account opening.

 

SEISS ❌Failed

Business Interruption Grants ❌Failed Discretionary Grant ❌Failed

Bounce Back Loan ❌Failed Universal Credit ✅Basic £409.89

 

My Outgoings:

 

TSB Mortgage £186 PCM Business Units Rental £360 PCM

Council Tax With Covid Reduction & 25% Single Persons £54 PCM Car & Van Insurance £198 PCM

Unit Contents Insurance £65 PCM Business Running Costs £327 PCM

Household Utilities Gas/Electric/Water £105 Food £300 A Month

 

Total Outgoings £1595

Income £409.89 Per Month Universal Credit

 

When I’ve fallen through every government support package bar Universal Credit can someone please tell me how I’m meant to pay all the above essential bills with only £409.89 to do it ???

 

So much for the governments big statement about not leaving anyone behind and putting their arms around us to support us !

 

I’m now a member of a Facebook support and campaigning group called ‘[…]’, The group already has over 5000 members whom have a variety of reasons and horror stories of why they’ve been excluded from help. The unfair treatment of many is discriminatory and unfair when you compare it against the members of this country that have been lucky to get financial support.

 

The groups page can be found here […]

 


 

This dire and unfair situation is causing me sleepless nights, Stress & anxiety and many days I’m not eating because I basically can’t afford to.

 

��� Is any of this fair when I’ve paid my taxes and NI like anyone else, Either through PAYE or self employed ???

 

How do I survive? If you have the answer I’d be grateful to hear it, Or if you can offer me any help / support in righting some of these exclusions and unfair treatments please let me know.

 

A rather worried / Stressed and hungry

 

June 2020

 


 

Written evidence submitted anonymously

 

What problems (if any) are individuals facing in claiming support from the Job Protection Scheme and the Self-employment Income Support Scheme?

What gaps in coverage still remain and are changes required to increase their effectiveness?

 

This is a different view of evidence in your Second Report given by 86 Mr Robert Edward Williamson (EIC0347) and 87 Mr Andy Tree (EIC0135), Ms Kirsty McGregor (EIC0141).

 

The problem with the annual pay period is the arbitrary start date of 6 April 2019, which makes a qualifying period of 350 days, and anyone paid annually between 20 March and 5 April in limbo. I pay myself on 5 April each year, so too late for 2020 and too early for 2019.

 

A simple sanity test is if the figures were reversed and furlough had happened 16 days into the tax year rather than 16 days before the end. Would the Treasury have restricted claims to RTI payments in the first 16 days and excluded the other 350 days? There would have been uproar.

 

The SEISS covers three tax years 2016-19 so it shouldn't be hard to extend CJRS to include the whole of the 2018/19 tax year or at least month 12. Come on Rishi. Get it done.

 

June 2020

 


 

Written evidence submitted anonymously

 

 

Re: Evidence regarding the Government / HMRC’s unfair exclusion of small 1 employee director companies from CJRS & the £10,000 cash grant

 

 

CJRS furlough grant support scheme has been unfairly designed to exclude small 1 employee director company’s such as ours!

Small companies with 1 employee directors without a payroll scheme have been unjustly excluded from the 8-9 month CJRS furlough grant support scheme & the £10,000 cash grant by various unfair criteria!

The following unfair criteria for claiming CJRS blocks Small companies with 1 employee directors:

1.       Having had a Payroll scheme before march 2020

2.       Having added PAYE for Employers before march 2020

The government / HMRC’S excuse is that they need to stop fraudulent claims! But we have declared to HMRC our director’s salary earning for years in annual:

1.       Corporation Tax filings &

2.       Director’s personal self-assessment tax returns

HMRC’s web site also contains a major bug whereby it doesn’t accept our 10 digit corporation tax UTR which has stopped us Adding PAYE for Employers in the past and even now!

We therefore have been excluded from and denied a total of £30,000 of vital financial grant support as follows:

 

1. £20,000 CJRS (8 x £2,500)

2. £10,000 cash grant offered to businesses with premises – even those that don’t pay any rent or rates via various support schemes!

We therefore urge that the treasury select committee recommends that the government/ HMRC urgently compensate small companies with 1 employee directors without payroll schemes who have corporation tax filing & self- assessment tax filing history a cash grant of £30,000 - for unjustly being excluded and denied vital financial grant support offered to companies with payroll schemes or premises during the current Covid19 pandemic & lockdown!

 

June 2020

 


 

Written evidence submitted anonymously

 

On the run up to lockdown on March 23 my wife and I, who both have our own businesses, and are in the conference production business had five jobs cancelled that were due to happen in March, April and May. As you will obviously understand there are now no face to face events happening for the foreseeable future.

The Chancellor then announced support packages for employed, self employed, and businesses, but not for my wife and I, and thousands of people like us both in and out of our industry. We have been able to furlough ourselves but only on the minimum wage. Our normal monthly outgoings far exceed this.

We have taken a mortgage and credit card holidays but that is coming to an end.

Whereas even the seemingly worst hit hospitality sector is being able to start back up, we cannot and do not know when we are going to be able to do so, let alone getting new business when eventually it does.

We are grateful for the Treasury Committee for championing this and would just ask that we have parity with the self employed which would mean we could claim up to £2500 per person based on the past three years accounting, have it back dated to the time the Chancellor’s initial packages came out, and continue to be supported until we are able to get our businesses back up and running.

 

June 2020

 


Written evidence submitted anonymously

 

I worked as a daily supply teacher at Burnham Grammar School; I have taught there since September 2018. The school has rejected by request for furlough as only contingent workers with ‘live’ assignments must be paid. As a zero-hour teacher, I am called in daily so do not have a ‘live’ assignment, however, if I had been employed via an agency, costing the taxpayer considerably more, I would have received furlough pay.

I have a disabled child who attends a SEN school and I am the only provider in my family. I am not eligible for welfare as I have some savings. I work hard and

save money. However, I have not received any pay since schools closed on 23 March. My savings are disappearing fast. I cannot get work whilst schools are closed.

Thousands of daily supply teachers working directly for schools are not receiving pay; this is in direct contradiction to the government guidance which is seen as advisory only. Please apply pressure on the HMRC to change the guidance to mandatory for all workers regardless of their contract type.

 

June 2020

 


Written evidence submitted anonymously

[…], who has raised issues about the principle of support available for those who are not covered by the current schemes for employees or the self employed.

 

[…] is a Picture Editor who has worked for […] since 2011. She is on their PAYE system, which HMRC have confirmed, although she has no contract and has always regarded herself as effectively self employed. However she is unable to claim the support offered to the self employed. […] have recently cancelled all her work and said they do not need her services for at least three months. They have not offered to furlough her under the Coronavirus Job Retention Scheme.

 

She has been without income since March, and has three children to support and a mortgage to pay. […] highlights that she has worked all her adult life, paying her tax and National Insurance and whilst others are supported, due to the nature of her employment she is not entitled to equal benefit.

 

My constituent highlights that many of those in her profession are losing work, are not being furloughed at a time when it is almost impossible to find alternative work but are not covered by the existing schemes.

 

Can you confirm whether any consideration is being given to strengthening the advice to firms who opt not to furlough staff?

 

As previously raised with you, it would be fairer for all workers irrespective of whether they are employed or self employed, to be paid 80% of their income. HMRC have the information necessary to do this and this would be a fairer scheme and not arbitrarily leave some workers without support and facing huge financial difficulties.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

My name is […] and I usually work as a freelance Assistant Producer in the factual TV industry in London in the UK. I have been working consistently in the industry since 2014.

 

Work in television is production based and production companies hire staff for particular productions as needed. This means it is normal for people working on the editorial side of productions to be freelance and to work multiple freelance contracts in a year.

 

For some unknown reason, HMRC mandates that people in television working as Assistant Producers cannot be self employed (even though their pattern of work very closely reflects that of many self-employed people). As such the contracts I work are all PAYE contracts. I find myself working multiple PAYE contracts as a freelancer every year – these can vary from 3 months – 1 year in duration but usually are only offered as a short period initially and then get extended as productions continue.

 

Winter in television is traditionally a quiet time where there is less work across the board and it is normal to have less work in winter.

 

This winter has been a quiet time for me – I had several job interviews and conversations about jobs in January and February relating to international productions filing in China but these fell apart because of the Coronavirus situation there.

 

At the end of February I had two job offers for productions with […] and […] but with the changing government advice at that time they delayed giving me a contract. With the lockdown being implemented the contracts have now been delayed indefinitely until such time these companies feel they can proceed. With the lockdown, outside of news, nearly all non-scripted television productions have been indefinitely delayed or cancelled and new programmes are not being commissioned.

 

As a PAYE freelancer I have no previous employer to return to who could furlough me (should they even opt to), and as I am not self-employed I have no ability to access schemes for the self-employed. I do not qualify for Universal Credit as I have some savings (supposed to be a deposit for a house).

 

The only thing available to me is Job Seekers Allowance of £74 a week - this is supposed to cover my rent (£850 per month), my food costs, my council tax payments, electricity bills, internet charges, mobile phone contract and all the other costs a normal person has.

 

In order to survive I have been taking whatever work I can find no matter how irregular or how dangerous. This has included being forced onto the Coronavirus front line as clinical support worker at the Nightingale hospital, working directly with Covid 19 patients. This work ended when the hospital shut. Now I am

 


working a zero hour contract as Covid test operative but I am unable to get full time hours doing this. Both these jobs have not given me enough money to cover my regular living expenses and both these jobs have increased my own risk of getting Corona virus, increased the risk that I transmit it to my household and increased my use of public transport further increasing the risk of me giving it to someone or catching it from someone in the general population.

 

I also know that I am not alone and a majority of people in the TV industry will be suffering in the same or similar circumstances right now, as well as across multiple industries.

 

It is either negligent or wilfully discriminatory of the government to grant relief to some members of the population and to deny it to others who could be in identical situations except for the manner in which they are taxed (which in my case is a decision made by the government, not me).

 

I would like to see PAYE freelancer granted access to funds as other people are. Perhaps this could be a direct payment made to us by the government, perhaps this would be creating a scheme similar to the self-employment scheme where an amount is calculated based on our previous year’s earnings.

 

Many people who previously were leading normal lives and contributing to society (and paying tax, national insurance, etc) are now in a situation where they are facing homelessness, depression, the prospect of abandoning their careers, shutting their businesses, battling depression and in some cases suicide. The lack of parity between workers is unfair and effectively amounts to discrimination against whole classes of people.

 

All people like me are asking for is to receive fair and equal treatment so that are lives are not needlessly destroyed by the government’s policy decisions. Please provide us with compensation (this is a more accurate word that support) for the government’s Corona virus policies that have prevented us from working in line with the compensation others are being offered.

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a Concept Modeller working in the Film industry. I am a Freelance PAYE contractor, taxed at source, yet receive no benefits such as sick/holiday pay or job security. I finished my previous job on 14th Feb 2020 and was due to start my next in early April. I missed out on all schemes available as I am also not self- employed. I am now 18 weeks with 0 income. I don’t know when I will get work again, or even if I can afford to stay in my industry.

 

June 2020

 


 

Written evidence submitted anonymously

 

My name is […] and I am a 2nd Assistant Director in the TV and Film industry.

 

I have decided to help give evidence to help in the on-going debate on people ‘falling through the gaps’.

 

I do not feel that I need to go on too much, but just give you my story as to how I have missed out on the two main Government Funding schemes.

 

Basically, my short-term contract ended on the 26th of February whilst on a TV show in Manchester. This was because I was on a 2nd Unit crew filming new/dropped scenes from various other episodes over the 6 month job, but also covering the key 2nd AD whilst she prepped for the next block of episodes to be shot. Myself and various other people were employed on various dates over January and February to help achieve all this. Normally these months are extremely quiet as the industry normally peaks from March and over the summer.

 

My contract is PAYE and once I finished and the Virus hit, everything shut down and other productions I would normally try and work on had all stopped prepping or may have not even got to that stage yet. Therefore when the rules came in for the CJRS I missed out by two days (28th Feb) to be Furloughed. As you can imagine this was hard to stomach as some people who worked less on that show worked on the 28th of February, in other departments and were Furloughed. That wasn’t their fault it was the rules, but again it was still hard as I have paid my taxes and when I reviewed my earnings last year and the taxes I paid, it was clear to see I should be entitled to £2500 a month. This however is impossible with the current guidelines.

 

The above doesn’t have to be published. I simply just want you to know I missed out and feel if something was set up on the HMRC website a lot of people could be saved by going off old tax records. More specifically 2019-2020.

 

I am quite lucky as I managed to get UC and New Style Job seekers, but it is a fraction of what I would normally earn. Although I am thankful for that support, I still eat into savings as I am used to living off my normal wage.

 

The funny thing is, is that the New style jobseekers goes off NI contributions. It took me less than a week to get backdated payments for that. So how can we not be part of the CJRS?

Surely it is similar to look into tax records.

 

Obviously, if there was a grant of some sort I would stop the other sources of income. I am merely using them to survive. However, myself plus many others could be out of the busiest part time of year for our industry and out of work for nearly 6 months. That is not even counting the quiet time over January and February. I got lucky with a month of work around then. God knows where I would have been now without that stint of work. So you can imagine how hard it must be for thousands or even millions of other people.

 


Thank you so much for helping us so far. The article yesterday was great, hence why I am writing this to continue to help. I hope myself and many others can get the support that most of the country are getting.

 

June 2020

 


 

Written evidence submitted anonymously

 

I write with regard to my company’s exclusion from all government schemes designed to assist during the coronavirus outbreak.

 

The business is a tiny limited company, with two employees (including myself) offering largely graphic design services. It has been operating for over 30 years, paying Corporation Tax, VAT, Business Rates (until exemption was granted), and National Insurance, while I personally have also paid income tax and National Insurance.

 

The company’s largest client by far is a major national event, which represents most of its business. The event was cancelled as a result of the virus outbreak; my company has done no business since the end of February.

 

Both of us are on furlough, but we have had no government support, having been excluded in three separate categories.

 

Firstly, the company is one of I believe thousands who have been affected by the manifestly unfair criteria for inclusion in the Job Retention Scheme. I will deal with this aspect in more detail, as I believe this hasn’t been fully understood – the Committee’s recent report only deals with it in an ‘end note’, in which there is an error, still excluding those who submitted between 1st and 5th April.

 

Until 2013, we would provide accounts annually to HMRC showing wages paid, and would pay whatever tax was due. In 2014, the requirement was instituted to join HMRC’s “Real Time Information” scheme (RTI). After some difficulty keeping up with monthly online submissions, we opted to make salaries payable annually, which also only required an annual RTI submission, reducing the administrative burden to a manageable level. We have been making annual submissions for several years – like many, perhaps most companies in a similar situation, we did this at the end of the tax year, in late March, though submissions may be made until 5th April.

 

This year the submission was made on 31st March. In early April, details of the JRS were published, and being as we met the Government’s stated criteria, I attempted to make a claim - only to find that the system told me I had no eligible employees. Initially, even HMRC support staff were mystified, but eventually it became clear that a subset of companies, those who had made annual RTI submissions between 19th March and 5th April, had been specifically excluded. Had I made my submission two weeks earlier, we would have been eligible.

 

To me it seems quite clearly unfair to arbitrarily exclude us entirely because of a practice that we had been undertaking for years, and which had been completely acceptable to HMRC throughout this time. The argument given, that there is a possibility of fraud, punishes everyone who has behaved honestly. It’s a bit like depriving all employees at a workplace of their wages just because the safe had been left unlocked for a day. Of course, any instances of fraud should be investigated, but there is no justification for penalising the rest of us.

 


 

 

The second exclusion is with regard to dividends. As with many small businesses, I have taken the larger part of my wages in the form of dividends from the company: I own 100% of the shares. This has followed the advice of all the accountants that we have used since starting the business, over thirty years ago. It has always been acceptable to HMRC, and has steadily attracted increased taxation, which we have duly paid. However, the covid-19 assistance specifically excludes such payments, even though it allows almost identical ones that the self-employed receive in the form of profits from their businesses. Again, this is manifestly unfair, discriminating entirely because of the business being a limited company.

 

 

Finally, my company has had no support from my Local Authority. For the first 32 years of the company’s existence, we worked in an office in the town centre, and paying Business Rates until exemptions were brought in for small businesses. As my children have grown up and left home, and my ex-partner (the company’s other employee) had also left, I had been increasingly working from home. Eventually, last November, I gave up the office. As a result, the company wasn’t eligible for the £10,000 grant given to thousands of small businesses around the country, simply on the grounds of where I undertook to work. Likewise, I wasn’t able to apply for the Discretionary Grant, as the application process was only open to those with a business rates reference.

 

I hope the above is useful for your researches, and that you will be able to use your influence to rectify some, or all of the huge inequities in the Government’s support schemes.

 

June 2020

 


 

Written evidence submitted anonymously

 

Sole ltd company directors & private health care

 

We are only entitled to claim furlough from PAYE (not dividends) this would give me an income of around £500 pcm. If I did this, I would not be able to get myself off furlough by seeking work as I would not be allowed to speak to my clients or potential clients. I can’t live on £500 and I would put my business at further risk by not even trying to get work, so this is not an option for me. Essentially I’m not entitled to anything, I don’t pay business rates. I don’t want a loan (debt) that I may not be able to pay off.

 

This scheme would not maintain my employment. It could only do this, if like the self- employed we received furlough and were able to continue to work. Our government clients insist on limited company status. We have very clear and accurate accounting records we would be happy to share to prove our income before the pandemic. We have paid tax and national insurance all of our lives and many of us has never claimed a benefit and still haven’t. We are only asking for the same rights as the self-employed.

 

New organisations have been set up to advise the chancellor that we have been forgotten and being treated unequally. The government to date has not listened and will not change their mind. We are a gap in the scheme which they are fully aware of. Our public sector clients are entitled to terminate our contracts as they are still operating in ‘emergency mode’ which is no longer required.

 

The government have rightly targeted support at the employed and the self-employed and even people with zero hours contracts, but they have ignored company sole directors. We need to keep going, we need money to live, we need to be able to get the economy going again as soon as we are able. We employ people, we are the back bone of the UK economy!

 

In order to survive we need a back payment to cover the fact we have had no or very reduced income throughout the pandemic, then we will be ready to help the economy recover. We should be on furlough to top up, until it is safe for us to work again in our industry. You will find that Ltd companies want to get back to work ASAP. We need an exit strategy that allows us to get back to work.

 

Small limited companies (sole directors) are not entitled to the Coronavirus Corporate Finance Facility. We don’t want debt from the Coronavirus Business Interruption Loan Scheme. Why do we get offered debt, when the employed and self-employed are given grants?

 

The government should focus on intervening with getting the private sector back to help the NHS and help with pandemic. We are important suppliers for the public sector. We are here to provide the public with services that they desperately need. We can see patients with appropriate measures to protect them and ourselves. They are at risk by not receiving ordinary services which have been stopped due to COVID.

 


The economy will recover quicker if we are trusted to get back to work safely ASAP. Why is it okay to shop on mass in Primark, but not okay to get a screening from the NHS for a potential cancer concern? This has impacted me personally. I need a scan, which has been cancelled. People are having heart attacks in the community and are too frightened to call an ambulance or go into accident and emergency. People with great health needs are being sheltered to the point that they are no longer considered entitled to services and due to their cognition are unable to voice their needs. They have been forgotten. They could be seen perfectly safely with full PPE. The NHS and local authorities need to get out of emergency mode now and start providing preventative and rehab services.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a self employed video editor in the television industry.

 

I freelance going from one job to another and because of the lockdown the last part of my last job was cancelled and everything else has shutdown.

 

My case therefore illustrates what you refer to as one of the remaining gaps in support.

 

As I earn just above the £50,000 cut off for the Self-employment income support scheme I do not qualify.

 

I turned to Universal Credit for support.

In the first month with no work I received nothing. This was because I received a payment for the previous months work during this period. The fact that the money was earned before the period I was claiming support for, or that I needed that payment to put towards my tax bill did not exclude it from being counted.

Had I submitted my invoice quicker it would not have counted and I would have received £409. Had I started my UC claim 3 days later it would not have counted and I would have received the

£409. Neither of these things were made clear prior to or during making the claim! I am waiting to see if I will receive anything at all after 2 months unable to work.

 

June 2020

 


 

Written evidence submitted anonymously

 

My name is […] and I am submitting evidence in regard to the Job Retention Protection Scheme and Self- Employment Income Support Scheme in order to reply to the question, How successful has the Government been in plugging the gaps in the schemes?

 

I, along with approximately three million other UK taxpayers, am currently not eligible for financial support from the Government. Following the report titled Economic impact of coronavirus: Gaps in support, I feel compelled to provide the reason I am not eligible as I know of many other people in a very similar position to me. I would call us the Newly Unemployed or Between Jobs.

 

Whilst I feel that the Government has done a sterling job in providing support for many UK taxpayers there are far too many people excluded from these schemes and brushed aside as though we do not matter, as though our lives do not matter and the lives of our families do not matter.

 

Just to introduce myself briefly; my name is […], I am 48 years old and have worked consistently and paid income tax for the last 32 years, my most recent positions in the Education sector as a teacher, curriculum manager and subsequently quality manager for the same organisation for the last 17 years. Education is not one of the easiest of sectors to work in and I have worked extremely hard and been successful in my employment. However, in January of this year I made the sad decision to leave my post after a period of sickness with my final salary being paid in February.

 

If the world was continuing to turn as normal my plan was to gain new temporary employment, following a well needed holiday at the beginning of March, via a recruitment agency whilst seeking a permanent post in a different sector. It was great leap of faith and step into the unknown but at 48 I felt the right time for me to explore other options and build a different career for the rest of my working life.

 

However the world stopped in March and I became a victim of ‘doing something wrong’ and therefore not being eligible for any of the COVID support schemes in my country despite the fact that I have paid my dues for the last 32 years with this being the first time I have been out of work.  So, I am in effect, being punished for the apparent bad timing in considering a change in career. Whilst I totally agree that a lockdown was needed, with businesses and organisations closing, this has prevented me from gaining the temporary work I planned and seeking meaningful permanent work as per my plan (though I am still trying).

 

I have had to make a claim for Job Seekers Allowance for the first time in my life which is something I never intended to do as I had money in the bank to cover my outgoings for the short period of time I was planned to be out of work.

 

I am slightly more fortunate than some of my fellow excluded taxpayers in that I have some savings in the bank but I should not have to live off my savings to get me through a pandemic. I should only have to live off my savings if I choose not to go to work. The pandemic and lockdown have prevented me from gaining new employment and the economic impact being that my savings will eventually run out and therefore I cannot spend as I usually would to help towards getting the economy going again.

 

I don’t understand how someone having paid taxes for 32 years is any less worthy than someone who may for example have only been working for 6 months of their adult life and that they were just lucky that they were on a company’s payroll on a specific date. I feel I deserve to receive some financial support from my Government. Financial assistance is desperately needed to get ALL OF US through this difficult time. All of the excluded taxpayers need parity with every other taxpayer.

 

I hope this helps to show that people that were simply between jobs at the time the pandemic and lockdown hit us are also worthy of support from the government rather than falling into one of the huge gaps created by the two schemes mentioned above.

 


 

Thank you for taking the time to read my submission.

 

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a single mother of 2 teenagers and a newly qualified Acupuncturist. Corona virus has severely, negatively impacted my finances and my family’s future.

 

 

I was a full time student studying a BSc (Hons) in Acupuncture from 2015 to 2018.

 

During this time I accrued credit card debt, despite working throughout my degree. Most of my debt was due to repairs I urgently needed to my roof/chimney. I searched endlessly for help & due to cut backs & despite being a student and single parent, there was none.

 

 

I graduated in Nov 2018 and immediately began practicing acupuncture as a self employed person, as is the norm in this profession, eager to write off my debts and provide well for my children. During Nov 2018 to April 2019, the first 6 months of starting the business, there were no profit, again the norm for a new business.

 

 

This is the tax year that the SEIS has taken its calculations of profits to award financial help to the self employed. So obviously with no profit I received nothing. It seems perverse to me that people with no profit & therefore already struggling, got nothing when covid hit ???? Surely the people with profit have something already to fall back on.

 

 

From April 2019 to March 2020 I had a good turnover. In March 2020 the turnover was £1800 for that month despite having to cease trading on March 17th due to covid symptoms in one of my patients. I was well on my way to having a good standard of living and paying off more than the minimum payments on the credit cards, and securing my children’s future.

 

 

I applied for Universal Credit and receive £400 per month. This does not even cover food let alone, utility bills, credit card payments (yes I have been given payment holidays but with companies still charging interest this leaves me with more mounting debt) deposits on my teenagers student accommodation for Sept (which is due now) and over £1000. Where am I expected to get this money? Do I have to tell my children that they can’t go to University or college because I don’t have this money? 1 child has a place at Med School at Birmingham University & 1 child attends a College for Musical Theatre. Yes, 1child will get a student loan and 1 child has a

 


 

scholarship type funding, but neither of these is paid until they attend their first day in September.

 

 

I was furloughed from a 1 day per week reception job and receive £218 from this, which is taken off my Universal Credit to give me the £400 per month. This is riduculous. £400 per month is well below a level required to sustain health . In such an event as covid, where it is no-ones fault that I am unable to work, the Universal Credit scheme should allow any meagre furloughed income to top up the Universal Credit, not have it taken away. If this were so, I would still be well under a national living wage with £618 per month.

 

 

 

 

In May when the government introduced the BBL for businesses, I applied immediately. Everyday since May I am having to re-enter my information as HSBC bank’s system keeps crashing. A month into this scheme and I am no where near getting this loan. A loan given to people with nothing is sickening, it should be a grant. In this crisis the people with money to fall back on have been given money- the people with nothing have been given a loan to pay back and place them in further debt. This is not right, fair or just.The stress and anxiety created by this is overwhelming.

 

 

The government need to check the amount people have to live on and top this up where necessary, to an average living wage, during such a crisis as this, in order to avoid ill health both nutritionally,emotionally and mentally. Otherwise the far reaching consequences of this pandemic will be catastrophic & irreversible, as will my family’s future.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

My name is […], I am 54 years old and I am a sole trader working in the construction industry.

I would like to submit for your consideration evidence of my position following the government’s Covid lock down measures. I very much hope to bring to your attention the frustration experienced no matter what Avenue of help I pursue and one unaddressed to my knowledge issue that is specific to the building industry.

I read that time is currently a big issue so in an effort to help as quickly as I am able please accept my apology for this somewhat blunt account.

I cannot claim financial help under the current rules because:

1  I am a newly self employed.

2  my furloughed wife’s saving are in our joint account and exceed the threshold for universal credit. 3 The only avenue open to me is to apply for a loan.

I have not been offered the financial support or security that the vast majority of the population has received. When hearing the reasons why I do not qualify it becomes even harder to swallow and I take issue given the following.

1  Until July 2019 I had worked almost exclusively my entire working life as employed paying the government what is due under PAYE. The last four years at least have been accompanied by tax returns due to travel expense allowance. HMRC have all my income information they could need but the government refuses to acknowledge my contributions and treat me equally.

2  My wife and I have joint accounts but the savings that are there are predominately my wife’s so I am penalised for having joint accounts. I am assessed unequally to single Pearson.

3  In July 2019 through circumstances beyond my control I became unemployed. The building industry’s preferred hiring strategy is to use for want of a more truthful description, “self employed” workers operating through a third party “barons". To work in this way I had to first register with HMRC to become a sole trader or, self employed. Then I had to apply to HMRC for my unique tax utr number.

This is needed as the government requires my baron to stop 20% of my earnings as tax at source. This is called CIS (construction industry scheme). It is only used in the construction industry and as such gives me a unique position of being neither employed or genuinely self employed. My tax is paid monthly to hmrc and my Barron gives me a receipt but I have no employment rights. The government reasons that bogus claims may be attempted and I can appreciate that however, in my case HMRC knows exactly when I registered as self employed. They know exactly how much tax I have already contributed from that date as it has been paid through their own scheme . My tax return for 19/20 was submitted and accepted before the extended 18/19 deadline was reached so perhaps that could also have been useful. Once again I have contributed everything required to meet my obligations but the government refuses to acknowledge this and treat me equally.

4  The only option left is to apply for a loan. I do not see the equality in the vast majority of workers being given a financial asset where I can only receive a burden and liability. A grant and a loan are not the same to a business struggling to get a foot hold in the market. I have like many suffered a financial

 


loss but once again despite a lifetime of investing in this country this government refuses to reinvest in me.

 

 

June 2020

 


 

 

Written evidence submitted anonymously

 

SEISS £50k Arbitrary Cap

I work as a mortgage & Insurance broker and I am excluded from any SEISS scheme assistance as I earned £115 too much in trading profits from four years ago, ie £115 over the arbitrary cut off trading SEISS profits cap. A cap only enforced on the self-employed.

This does not reflect my current earnings position. Also I do not earn anywhere near the ‘averaged up’ £200,000. If I was an employed broker earning £50.1k or indeed £200k+ I would be entitled to consideration for up to £20,000 CJRS assistance via the unlimited cap earnings scheme. If I had earned £115 less four years ago I would be entitled to just over

£14k in grant assistance consideration. But because of my tax status (self-employed) and that £115 I am entitled to £0 in scheme assistance, with loss of significant business caused by the Government’s mandatory lockdown of trade.

Since the housing market ‘reopened’ what I have experienced in respect of new business residential mortgage opportunities wise is limited to nil.

Lenders have ‘pulled’ their higher LTV products restricting access to mortgage availability for many target markets, inc first time buyers who tend to rely on these products more. This is detailed at present right across the current media.

This shows no sign of abating and if anything is growing steadily worse. Lenders are also imposing stricter Covid guidelines on accessing funds too. This is understandable from a lenders viewpoint but restricts earnings capacity as those who may have qualified in Feb 2020 may no longer do so. This could follow right throughout 2020 and beyond.

On 16 March a leading mutual withdrew physical valuations. To date these still remain without progress. Over three months, and no progress. So potential earnings are still some way off from ‘pipeline’ income started before lockdown, which under normal circumstances would be coming to a payment conclusion point around this time, mid June 2020.

We have also seen business withdrawals as people have lost their jobs so ‘pipeline’ income taking a further hit, and new business enquiries in general plummet as people wait to see what the next six months or so brings for them employment wise.

Insurance application’s remain very low as these tend to follow in hand with the mortgage progress, and if you are able to make an application which requires information from a GP understandably these remain largely delayed or postponed as GP’s continue to prioritise all matters administrative wise associated with the pandemic.

This is all happening now. 17 June 2020.

The TSC report, 15/06/2020 page 13, section 37 highlights that support should be provided to those just over the cap, taking all factors into consideration.

Its incredulous that this arbitrary position still prevails at point of writing.

There are no equivalent ‘support measures’ that are available or even come close to scheme assistance. Regardless as to the continuous regurgitation of this strapline from the Government & HMRC. Loan & tax deferrals are just that, storing up bigger debt, taking on a loan is irresponsible if you don’t know if you will be able to pay it back, and indeed is simply more dept. Universal credit (if you can qualify) is an absolute fraction of scheme assistance. Discretionary council grants also exclude homeworkers, thus excluding large volumes of those already excluded. Yet open and paying to those already in receipt of scheme payments. Working your way through any savings (if available) is not an adequate solution either, as far wealthier & higher earners are currently benefiting from Gov assisted scheme

 


 

payments and can retain all savings untouched. The Government have the 15/06/2020 report. It is fair, balanced and depicts the circumstances correctly of exclusion.

Why are they not acting on this?

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a self employed Acupuncturist. I am also an older person-[69 years],in receipt of pension income but working a few hours each week to supplement my pension.

Because my income from self employment over the past 3 years has been less than 50% of my total income ,the government has given me no support at all.

There must be many older people who also do a small amount of work for the same reason as myself and it seems wholly unfair that we have been left out of the help scheme.

 

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a sole director of a limited company that operates in the broadcasting industry. I had to become a limited company due to IR35 regulations as larger organisations/companies refusing to hire me unless I am a limited company.

I pay myself in dividends after receiving a small annual salary; I am on an annual PAYE payroll – but this is the very reason why I am not able to apply for any government help because the cut-off date to be furloughed was 19th March, and I submit my annual payroll on 31st March. The government is also not allowing me to claim any financial help on the grounds that I pay myself rather modest dividends to help augment my salary; this is merely cost-of-living payments afforded to myself, not a huge bonus for making a massive profit (which I don’t).

The upshot is that I am not able to furlough myself, neither am I able to claim any grants in any offer from the government. I cannot afford not begin to get into debt with offers such as a Bounce Back Loan, so I must use up my life savings to merely exist during this period of great uncertainty. Indeed, it is because I have some savings, that I am not eligible for Universal Credit. For the record, due to the nature of my work, I am not eligible for a Small Business Grant - neither am I eligible for a Self Employed Income Support Scheme.

Quite simply, I have fallen through the cracks and I am not alone. I have aligned with #ForgottenLimited and social media groups ‘Annual PAYE’ and ‘#ExcludedUK’ as there are thousands like me who have had no financial support at all, during this pandemic.

I would like the Chancellor to include company directors who pay themselves annually via PAYE, in the furlough scheme, thus changing the date of submission to 31st March from 19th March. The excuse of ‘preventing fraud’ for the chosen date of 19th March, has caused untold financial hardship and damage to the welfare and businesses in the creative arts sector (like mine) - and pooled us together with a few who might seek to cheat the system – but this is unfair and grossly unjust.

 

 

I would also like to see dividend payments included in our monthly salaries when calculating monthly payments for furlough as this is the only way that we can survive i.e. by taking dividends after declaring a low salary – something that is seen as ‘normal’ for many small company directors. We are not trying to cheat the system – but it is the only way that we can operate and have a half decent standard of living.

It would be right to backdate these payments for the thousands like me, who have received nothing to help us over the past few months, despite being hard-working taxpayers. Ironically, our taxes will probably rise to pay for the furlough scheme that we were never allowed to be a part of.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

 

Evidence regarding the self-employed income support scheme

 

There are several groups of people who fall through the gaps in the criteria for self-employed support and so far, nothing is being done to support those effected. I am a self-employed taxi driver and so far, I haven’t received any financial help and it doesn’t look like I will be getting any.

 

 

I was working on an employed basis until July 2018 when I was made redundant by my employer. I then started as a self-employed taxi driver in August 2018. My 18/19 tax year I earned slightly more through being employed than I did through my self-employed work, although this was mainly because of my redundancy/lieu payment. As such I am falling through the gaps because of the rule that 50% or more of your income must be on a self-employed basis. I expect this rule was implemented for people who are both employed and self-employed and working two jobs. I haven’t worked two jobs at once and all my income since August 2018 has been on a self-employed basis. I have submitted my 2019/2020 tax return, but this won’t be considered. I am still self-employed but haven’t been able to work since 26th March and I am still not back to work.

 

 

I have submitted additional information to HMRC and asked for two reviews, but their stance remains that I am illegible because they will only look at my 18/19 tax year and I don’t meet the 50% criteria. I also applied for universal credit and although I was told I would receive payment on the day I was due to get the first payment upon checking my account they had updated their notes to advise I wasn’t entitled to receive any payment because my wife is still working. I have now been three months without brining in any income and even if I am able to start working in the next month or so it will be a long time yet before I see the amount of work return to normal.

 

The government needs to implement some changes to their r criteria to help those who so far are being excluded. would like the government to either consider 19/20 tax returns or stop reviewing case on such a black and white basis when I don’t work teo jobs and I was newly self-employed. Even if they can use my figure form August 2018 – March 2019 to calculate the 80% amount I am entitled to, it would be better than nothing.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I am contacting you in your capacity as Chair of the Treasury Select Committee. I have noted your recent report on the Economic Impact of Coronavirus and the Gaps in Support arising from the various Government schemes available. I am writing to you specifically regarding the Job Retention Scheme and an issue which is affecting many employees and office holders of

companies, making them ineligible for support under the Job Retention Scheme. It is not an issue which I have seen you mention or which appears in your report on Gaps in Support.

 

I am a Director of a small company and have attempted to make a furlough claim under the Job Retention Scheme and have been told that the employer is not eligible for the Scheme and hence cannot make a furlough claim.

 

This issue affects Directors, office holders and employees of some companies which operate an Annual Payroll scheme under PAYE. These are operated by many small businesses and the problem is entirely different and separate from the "dividends" issue.

 

Many small businesses operate an Annual Payroll, where the company pays the employee only once a year, rather than monthly. It is a perfectly legitimate form of payment and is one arrangement offered by HMRC and one option available under HMRC's payroll software that is offered free of charge to users for operating PAYE under the RTI system. Many company directors and other office holders (such as the company secretary) and other related employees of a small business utilise an Annual Payroll system, whereby the salary payments are made once a year, for example £10,000 paid at the end of March each year, rather than making small monthly payments throughout the year. Often the annual payment is just below the threshold for National Insurance contributions.

 

These employees are eligible for furlough and the furlough amount that can be claimed is pro-rata of the last annual payment.

 

The annual payment date for an annual payroll is often chosen close to the end of the tax year, so 31 March is a popular date, which is also the year end for many companies.

 

However, when one tries to make a furlough claim using the Job Retention Scheme online claim portal, in the case where the annual payments have been made on 31 March each year, the online system provides a message that the records show that there are no employees on 19 March and that the employer cannot make a furlough claim under the Job Retention Scheme, with the result that the employee is therefore not eligible for furlough. Whereas if the annual payment date had been on 28 February each year, the claim would have been processed without any problem and the employee would be eligible.

 

This is patently unfair and is not the way in which the scheme was intended to operate. The HMRC RTI software provided to businesses knows that there are employees on the system from the records of previous years held on the software system. No leaver forms will have been processed through the HMRC system, so the system knows that these remain employees. When one updates the RTI system to the next tax year, the system automatically migrates all the existing employees from one tax year to the new tax year and then asks for the payment date and amount to be input for each employee. So all works fine for payroll and the RTI system. However, for the Job Retention Scheme, HMRC is not recognising long standing employees of small businesses which have made annual salary payments to employees each year through the RTI system. Instead it is merely looking at what has been logged on to the RTI system during the tax year 2019/2020 for the year ended 5 April 2020. If the annual salary payment for 2019/20 has been made before 19 March 2020, it is allowing a JRS furlough claim. If the annual salary

 


payment for 2019/20 has been made after 19 March 2020 a JRS furlough claim is not allowed and the employee is not eligible for furlough under the Job Retention Scheme.

 

I can understand a cut off date of 19 March 2020 for new employees, so that companies could not take on new employees after the JRS was announced and take advantage of grants to pay the salaries of new employees. However where an employee has worked for a company for many years, been paid for all these years at the end of March each year, then the employee has been on the payroll of the company for these years and remains on the payroll. The employee should be absolutely entitled to be eligible for furlough and the employer to receive the grant from the JRS, in the same way as employees of other companies operating monthly payrolls. For those long standing employees, it should make no difference what date has been chosen as the annual payment date each year.

 

I have raised the issue with the JRS helpline at HMRC. When explained to them, they understand the issue and seem to be aware of it, as they have said there are many people affected in the same way, but that HMRC is only applying the rules of the JRS.

 

This is not the same as the "dividend" problem, where payments have not been made as earned income from employment through PAYE. With the annual payment issue, the payments have been made as earned income from employment and logged through the RTI system each year, so there should be no doubt as to eligibility for the JRS.

 

I thought it would be worthwhile bringing this matter to your attention, in the hope that you may be able to help the many employees and small business owners operating as companies who

find themselves in this position and are unable to claim any support.

 

If you wish to know any more details, please let me know. In the meantime, thank you in advance for your time reading this email and for any assistance.

 

June 2020

 


 

Written evidence submitted anonymously

I believe that part of the proposed solution is to extend the cut off date to 31st of March for newly in employment.

RTI as in recent clauses which has left many behind needs to be looked at carefully as its led to so many being ineligible for the CJRS.

RTI even for the majority of monthly paid employees there are different dates of submissions by employers.

Which I believe in future should be a set date for all companies to submit employees RTI during a given period which HMRC can implement for fairness of protecting employment rights .

I would like to share my personal circumstances of not being eligible.

 

I started a new employment on the 2nd of March having been made redundant on the 28th of February 2020 after 6 years of optical service in one branch, Some employees have requested to be rehired and furloughed which was rejected .

In my new employment the process of going through a recruitment service involved a several weeks of being interviewed at different stages via call chats ,video calls and providing a trail day before securing my role I have a chain of emails welcoming into the team , confirming and signing my contract on the 13th February 2020 my professional fees paid by the 27th of February 2020.

I commenced work on the 2nd March ,paid on the 27th of March but my RTI submitted on the 6th of April.

I have since received two payslips March for working 3 weeks before lockdown as my employer expected I would be furloughed due to the Chancellors announcement on the 20th of March it was later announced that the CJRS criteria didn’t allow employees in my situation to furloughed, therefore in anticipation that the CJRS will be amended my employer decided to keep me on for 4 weeks with paid holiday to buy us time for the scheme to be amended, which I was extremely grateful for since May I have been on unpaid leave and advised will remain to be case until September as social distancing will prevent me from returning to work on a part time basis of 1 day a week.

This would lead to a further 5 to 6 months of no income as a parent of 3 Its extremely difficult manage bills and keep food on the table.

 


 

I have since come across fellow campaigners who didn't have RTI submitted till the end of April as there start dates who differ in line with working there notice from previous employment.

Therefore it’s only fair to highly the unfairness of extending the date to 31st of March it needs to include all employees with adequate evidence of job start dates confirmed with evidence base of employment.

The system needs to be fairer with consideration of start date of employment or evidence based contracts or both for those less fortunate then I who had jobs either deferred or retracted.

If an RTI is to be considered then we hope this would be in line with individual start date which I believe would be more successful , to extend the date to the end of April or beginning of May would support all employees in this situation providing they commenced employment or offered contracts in March and had been deferred.

I totally agree that the CJRS needs to also be considered retrospectively as well we have suffered heavily as consequences of the CJRS faced debts lots homes and ineligible for other benefits that don’t even meet 10% of living costs being on unpaid leave since or made redundant.

Unemployment’s are raising daily making it even more difficult to find and secure employments in this climate as business are finding it difficult retain staff and manage with the pandemic.

I sincerely hope that this hope adequate report for your viewing and to support us during our difficulties no one should be left behind.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I’m a PAYE Freelance 2nd Assistant Director in Television, working for multiple employers across the year. These contracts can range from one day (usually called a ‘daily’) to as much as 19 weeks (the longest for me), though this can be longer still or indeed shorter. I’ve been working in the creative Industry for 20 years working my way up from Floor Runner to 3rd Assistant Director and now 2nd AD. I have a consistent tax record and regular work record over this time. However, I have been unable to access any of the Government Support Schemes.

As HMRC forces me to be payed as PAYE, I was not covered by the Self Employed help package SEISS. So my last 3 years tax contributions are not being allowed to be taken into account and I’m unable to get 80 per cent of my regular earnings.

I was not under contract in February and so could not be Furloughed as a consequence. Traditionally January and February are quieter times of the filming year as Productions are still getting funding/being Commissioned and many television crew are still hunting and waiting to confirm a contract.

I applied for Universal Credit but was declined due to savings that my wife (a mum at home) has. I’ve received Job Seekers Allowance since March 1st 2020 until now and have had to take on a warehouse job in order to get a basic income, which will help stem the haemorrhaging of our savings. However, it will not cover all our mortgage and bills and the earnings are considerably less than I receive as a 2nd Assistant Director.

June 2020

 


Written evidence submitted anonymously

 

As a freelance sub-editor working in publishing and for magazines that are currently not being printed during the corona crisis, I fall into one the many categories that are excluded from help under the Self-Employment Income Support Scheme, because in the past few years more than 50% of my income has been paid through PAYE. However, all that “employed” income was on a freelance basis too, made up of day rates paid without a contract being in place, exactly like the part of my income declared as “self-employed”. It was just some of my clients’ company policy to pay freelancers in that way.

 

My tax records can readily confirm that I was not paid a salary, but a different amount each month, depending on the number of days I had invoiced for. Therefore, it seems completely unfair and irrational that I don't qualify for any support under SEISS, and surely unintended – I am exactly the kind of sole agent the government is trying to help. Please review this urgently by removing the 50% barrier and taking all freelance income into account for support to the level of 80% of usual earnings, regardless of how it was taxed.

 

The only help I have received is a small furlough payment kindly arranged by of my regular clients, based on earnings there of about £4,400 per year. My usual total freelance income is about £35,000 per year, so this leaves a huge shortfall, and I don't qualify for Universal Credit or other benefits as my partner works. It is a frightening experience to find oneself suddenly falling through the cracks, now that my regular work has disappeared, and it is a very difficult climate out there now for finding new work, with offices closed and many employers cutting back staff.

 

June 2020

 


 

 

Written evidence submitted anonymously

People that Rely on Furnished Holiday Lets

 

The Chancellor has not covered people that depend totally on income from furnished holiday lets. This income is classified as FHL on the tax form and not self-employed nor PAYE. It means that many people in rural areas that really on tourism through FHL have been forgotten.

June 2020

 


 

 

Written evidence submitted anonymously

Self-employment Income Support Scheme (SEISS)

I am submitting this evidence as I am most unhappy about the Self-employment grant that I have been awarded as I feel I have been punished and treated detrimentally due to having had cancer treatment in 2016 and 2017. I made an appeal to HMRC which was turned down and in my view this decision also very much contravenes the Equality Act.              I believe I have been treated with great injustice and wish this to be rectified.

I am an Occupational Health Nurse providing services to mainly small business in Devon and Cornwall which I have been doing on a self-employed basis for more than 15 years. My trading profits each year were generally at least 20k for some years e.g. £22,864 for 2015/16.

Unfortunately, I was diagnosed with breast cancer in March 2016 for which I had extensive treatment and quite a number of hospital admissions. So for 2016/17 my self-assessment income was only £891 and HMRC can see that the rest of my income was state benefits of

£4,899 for that year. I managed to return to very limited part-time work very briefly but was then diagnosed with stomach cancer for which I needed to have further treatment including surgery with recovery time needed due to effects of the surgery. This resulted in another period of time with my income being from state benefits only of £3,962 until around November 2017 when I started very gradually returning to work and my self- employment earnings were only £2,133 for the tax year 2017/18.

I was able to continue working for the tax year 2018/19 albeit part-time hours compared to before my illness due to some ongoing health limitations.

SUMMARY

 

Tax Year

My Trading Profits (self-employment)

Benefits ESA due to illness

(also declared on my tax return.

2015 to 2016

£22,864

None

2016 to 2017

£891

£4,899

2017 to 2018

£2,133

£3,962

2018 to 2019

£14,007

None

2019 to 2020

Estimate 13 to 14k

None

 

For my self-employment grant value, HMRC added together my trading profits from years 2016/17, 2017/18 and 2018/19 as below and then calculated an average over 3 years, 2 years of which I was ill and worked very little.

 

 

This is how HMRC calculated my average trading profits.

 

Tax year

Trading profits

2016 to 2017 (Cancer treatment)

£891

 


 

2017 to 2018              (Cancer treatment)

£2,133

2018 to 2019

£14,007

Average for the 3 years

£5,677

 

 

How HMRC calculated my grant amount:

Non-trading income was not included when calculating the grant amount (which I assume means my ESA sickness benefits).

Average trading profits for 2016 to 2017, 2017 to 2018 and 2018 to 2019              £5677.00 Average trading profit for 1 month (divided by 12)                            £473.08

Average trading profits for 3 months (multiplied by 3)              £1419.25

80% of the 3 month trading profits              £1,135.40

My Grant amount              £1,136.00

 

 

This resulted in me getting a grant of only £1,136 for the 3 months which is not enough to survive on and significantly lower than what other people are getting e.g. those furloughed or those newly self-employed from 2018/19 who received 80% of their tax assessment profit.              Employees who had sick leave in 2016-2018 will not be penalised for this and will get 80% of their current salary so I don’t see why self- employed people should be treated so differently. The percentage I have been awarded of my usual earnings (2018/19) is (4541.60/14007) equivalent to only 32%.

In my view, I strongly believe that the nearly 2 years when I was ill and when my main income was from sickness benefits should not be used at all for calculation of my grant.

In my appeal to HMRC regarding my self-employed grant, I requested that only the 2018/19 trading profits of £14,007 should be used for my grant calculation which would have given me a grant of £2,801.40. This request has been turned down by HMRC in a letter dated 12th June 2020. It was stated that this was due to having traded in the three tax years and therefore my grant is calculated based on the average trading profits for those years as per my tax returns. HMRC stated in my letter that for the purposes of this scheme there is no provision to make adjustment for reduced profit years or include the 2019-20 year information.

So it seems that this averaging of profits was on the basis that I did have a very small amount of trading profits in those other 2 years. It seems that if I hadn’t earnt anything at all for those 2 years when I was ill, then only the 2018/19 tax period would have been counted. So essentially what is my current normal income since my difficult period of illness (when I struggled with significant financial hardship for a prolonged period) has been divided by almost a third which is extremely unjust.

 


 

It seems that I have been further disadvantaged financially due to having had cancer treatment which seems to be grossly unfair. This decision cannot be right especially if also taking into account the Equality Act and not discriminating against people due to health conditions/disability. How can this possibly be fair?

Please can you make provision in the grant rules for being able to exclude years when the main income was ESA sickness absence benefits and particularly as I do have a full tax year assessment for the most relevant year of 2018/19 on which the grant can be based. This would also ensure compliance with Equality Act legislation and avoid further disadvantaging people who have already lost significant income through illness as well as not being able to resume previous full-time employment.

I have no idea when I will be able to resume my usual self-employed work but it may not be until the autumn at the earliest. This money is essential to me and I strongly wish to be treated in a fair and just way and not be so blatantly financially discriminated against.

June 2020

 


 

Written evidence submitted anonymously

 

I am a self-employed Complementary Therapist […]the company name is […].

 

I began operating in 1995, initially renting a therapy room within existing business premises, then later in a Gym/Leisure Complex

.

After qualifying to provide on-site services to business and staff members I approached various companies and was successful in gaining access on a regular basis to several North East places of work.

 

Currently, I am semi-retired, but continue to work 2 days per week. I am in receipt of Basic State Pension.

Together with an Accountant based in […] my tax-returns have been submitted accordingly.

 

During the current Covid19/CoronaVirus pandemic, it was my understanding that the Chancellor's information was that self-employed persons would be included in the monetary assistance which was payable by 30 June 2020. This figure would be calculated fro the last 3 years tax-returns held by HMRC.

This support was not forthcoming and on making enquiries was told because the figure calculated when set against my pension I was not eligible for any support whatsoever.

I contacted a Citizens Advice offices and was told exactly the same information.

 

 

The reason I am now contacting yourself is because:

 

a)                 why is there no equality/parity with furloughed employees regarding the 50% rule ?

 

b)                why was my pension taken into account when calculating my claim when

my partners pension was NOT taken into account when he submitted his claim ?

 

c)                 I am placed in what appears to be the last 'group' alongside hairdressers and beauticians for being able to return to work – my last working date was: 17 March 2020.

 

June 2020

 


 

 


 

 

 

My wife and I are directors of our Limited company. Company has been in business for 20 years. Historically all income is derived from work overseas. This overseas work is not possible due to Coronavirus restrictions, so income is now zero, and directors are Furloughed from 28 March performing statutory duties only.

Self Employed Excluded from Support schemes

 

We pay ourselves with a mix of salary and dividend. In recent years, Accountant’s advice has been to take salary at around the ‘Primary Threshold’ (so c. £8000pa for 2019/20)

We pay salary as annual lump sum in month 12 when we are sure of the year’s earnings.

For 2019/20 this was paid 28 March. We were led to expect furlough support on at least the salary element, but HMRC are applying the 19 March cut off date and declining Furlough payment, despite 20 years of continuous employment with the company.

There is no support for the dividend element, and as bad luck would have it, through being prudent we also fail to qualify for other support by the company having made a ‘loss’ in 2019 due to company catching up with pension payments.

Accordingly we are denied all support despite the ‘whatever it takes’ commitment. Prospects

Being just a few years from retirement, and with no support to underpin business development post Covid, the directors very much doubt that the company will be able to trade again

 

 

June 2020

 


 

EIC0679

 

Written evidence submitted anonymously

 

I work as a Production Manager in Sports TV. In April 2019, I moved from being a PAYE Freelancer to a Sole Trader. This was done to reflect a change in the type of contracts I was being offered. I went from having 1 long term client, to very many different short contracts.

 

In March 2020, every sporting event I was scheduled to work until September on was cancelled. I had in my diary […] as just a few examples. All gone. I was paid just one day cancellation fee.

 

As I was taxed at sourced in 18/19, I did not submit a tax return, I am not entitled to SEISS. It has been suggested that the scheme can not include people like me as there are fraud risks. In my case I do not believe this is true. I informed HMRC in April 19 that I was trading as a sole trader. I have invoices/bank statements/ emails from clients for the full year. I also earned only £6000 more by taking Sch D payments in 19-20 which really just reflects I now pay my own pension. I went from earning £42,000 PAYE to earning

£48,000 as a Sole Trader. I am very obviously not a fraudulent claim!

 

I was on paper allowed to claim Universal Credit but as late invoices from Feb/March have credited my account, I have not been entitled funds so far. I will be able to claim hopefully next month. I was originally told in my Universal Credit interview that I was not entitled to JSA as I was self employed. Luckily, I later challenged this and was given a back payment.

 

In September, I will be back to my 50 hour working weeks. I have confirmed work for 7 months which I am so grateful for. However, with such limited income and my savings dwindling, I am really worried about how I will pay my bills until then.

 

I feel so let down by the government, I’m not sure why I am less important than the very many people they have helped. The 3 million excluded have been made to feel like criminals when in reality we are only asking for parity. The difference between me changing the way I paid my tax in April 19 instead of April 18 has meant I’ve missed out on £13,500 of help. Did I really do something that wrong?

 

I’m terrified that there will be a 2nd wave and I’ll be in the same position again. If that was the case, the only way I would survive is to sell the home I have spent years working for and love. I don’t know how else I’ll survive

 

Thank you taking the time to read this.

 

June 2020

 


 

Written evidence submitted anonymously

 

Let me tell you about myself and why I feel such a strong sense of injustice. I started working as a teacher in 1979 . Apart from 3 years working overseas as a volunteer (VSO) I have worked all my life either in schools , Universities or Local

Authorities. Each time I moved employment my pension conditions worsened so at 62 I only have one small pension (others do not mature until I am 65 and my state pension not until 66 now. ) For the last 10 years or so as a public servant I was subject to pay caps. In May 2019 I was approached by two organisations both educational to take on freelance work with them , the Local Authority I was working for was facing major restructuring and my health wasn't good so I decided to resign and to register as self-employed . 2019-2020 was a good year for me up until March 2020.  My earning weren't great (under £30 000 before tax) but enough to live on and the work in schools and with a London University exciting.

In March 2020 all my work dried up because of Covid 19, I am a single Mum with two adopted daughters one in 6th form and another home from University now. I was concerned that because of my health I could not go out and seek

alternative work .I am insulin dependent diabetic (14 years now) and take medication for high blood pressure, atherosclerosis and angina. The job centre plus assessor indicated as I was in the clinically vulnerable group so a claim for New Style ESA would be accepted. There was no other help I could access. My occupational pension is £845 a month , my ESA is £12.26 a week. I am not sure why they will not pay the first 7 days of my claim but I am not likely to quibble over £10.96

 

 

DWP  calculate ESA  that  a weekly income of              £74.35 is sufficient to live

on              (excluding child benefit for 1 child) I have a mortgage to pay, along with all the other household bills,  including a large council tax bill.              I have modest savings - but over £16000 accrued from a life time of work and a pension excludes me from all other means of support (some of this money I will need to set aside for tax.) I've worked for 35 years, and have 42 years worth of NI , the date of my state pension age was changed from 65 to 66. I live modestly and have never been in debt. I am concerned that because of my health working elsewhere even if I could get work would be risky at the moment and with two dependents (one of whom is also in the clinically vulnerable group) I'm not willing to do that, as a newly self-employed worker I have been excluded from support offered to others I am one of the 3 million.

 

 

I know I have savings, which I am having to live on to survive until they are

gone,              so think it very unlikely you can point me to any other means of support or relief , and Turn2us have excellent benefit checker websites which I used. You'll have to appreciate however that as well as the financial hit, what I feel most is a deep sense of injustice. I could have turned my self-assessment around in two weeks. Rishi Sunak did not have to label me  (and all newly self-employed people) as potential fraudsters. I have contributed so much over the years but when I needed that safety net it's just not there, either through benefits or a Government Covid scheme, and effectively I am getting a message which translates as - tough!

 

June 2020

 


 

Written evidences submitted anonymously

 

 

I am the sole director of my limited company.

 

I have been unfairly penalised by the government by being excluded from meaningful support.

 

It seems there is a vendetta of sorts against people like me because there is a perception we are ‘tax dodgers. There is an extremely marginal tax benefit. Whilst the meagre tax saving is of course welcome, it is not really the reason myself and many of others operate in this way:

 

I would happily pay more tax – why don’t they just raise the dividend tax to a little higher on the first chunk?

 

I operate as a limited company because my clients require this, I was also advised this was the best way to work by my accountant. It also means I can take out essential insurance policies and create a separation between my work and home finances. There are many reasons people do this LEGAL THING.

 

I have diligently paid a host of taxes my whole life, I have never claimed a benefit.

 

I am not in charge of the response to covid (the government are and their poor performance means that my livelood his further affected). I did not do anything to bring covid to the UK. The entire situation is out my control.

 

I live in the 6th biggest economy in the world. We are an archetypal developed nation. Why is this acceptable?

 

It seems strange to me that during this crisis me and (and estimated 3million others) are being excluded from any meaningful support. I managed to furlough myself for 6 weeks and received £800 but that and a small job is the only work that I have managed to bring into my business since March.

 

Whilst on furlough I cannot work.

 

My furlough is only about £500 per month – not enough to even cover bills. Once the mortgage holiday ends I will be in real trouble

I cannot claim UC and believe UC is not enough for anyone to live on who pays bills and wants to eat… let alone pay for a mortgage

 

I live in a leasehold property and the management company want to do works to install a handrail… I cannot afford this yet I have no power to stop the bill coming…

 


 

I am not offered any help by the government because they say ‘it’s too complex’ (from what I can see it isn’t)

 

I am not breaking the law by what I do yet I have been made to feel I am...

 

I am really struggling financially and terrified of a second wave and SPIRALING DEBT

 

I can get a BBL but I feel angered at this as ‘support’ – I need personal support, I need money to pay my bills and this is a roundabout way of giving that that also requires me to take on a huge amount of debt – I am morally against credit cards and debt (aside from a mortgage) so I feel angry debt is being forced on me.

 

The government have excluded MANY from support (about 1 in10). I see hundreds of posts in Facebook groups of people REALLY struggling. Thousands of lives and livelihoods are being destroyed.

 

I have never felt so upset and angry with the distain clearly directed at people by the government. We are hard working tax payers that have simply been brushed aside.

 

 

Others who were supported are treating this as a paid holiday and revelling in how much money they are saving… meanwhile others get ignored.

 

Sole traders got a £12k handout many didn’t need and can still work if they want to Furloughed staff can take second jobs (away from people like me who need it)

 

 

June 2020

 


 

Written evidence submitted anonymously

 

2 February gave one month notice of intention to leave employer shop work minimum wage 24 hour per week

3 March started a job as Quality Assurance Assessor increase in hours and wage

31 March advised that business scaling down and furloughing most staff with myself not eligible so on unpaid leave. Terms of contract state I am unable to take other work while under contract.

8 April pay day for the month of March therefore RTI NOT submitted 19 March as per amended furlough scheme due being paid 8th monthly

 

 

No Universal Credit available due to having savings from a previous redundancy and having a husband who is in paid work. Explained situation and New JSA received.

 

 

In May I contacted My new employer to check what the plan is. Advised that unlikely to be in again until after CJRS has finished. I am unable to continue for 5 months more only contributing £300 per lunar month to the house.

19 June I have given notice to my new employer of one week and am due to start somewhere else 30 June.

 

 

I have worked since 1985. I have always paid my way. I am 13 years from retiring and I am forced out of my financial independence for the sake of a date that makes no sense in the normal working of monthly payroll.

June 2020

 


 

Written evidence submitted anonymously

 

Covid 19 no support.

 

31 year old male.

 

Established as a sole trader in July 2019. Worked as a freelance chef earning between £800 -

£1200 a week for the whole of summer 2019.

 

Planned and put various procedures in motion to open a mobile food trailer business for 2020. Business will employ 2 other staff members with the view for expansion. Business plan laid out, all systems go various equipment purchased.

 

Since lockdown I have not received any support, have been forced to stop freelancing & my business expansion which was due to launch this year has had to be put on hold, I have fallen through the gaps of any grants, finding it impossible to get a BBL, as I was initially running my business from a personal account, I can prove all trading and invoices which match with payments made into bank accounts & also even a business plan to expand and grow, but as I had not yet established a business bank account banks have been rejecting me for a bounce back loan, the exact people they were intended to help.

 

Receiving benefits & being forced to sell my car I am not able to get back to work. I will remain far more of a burden on the system over the long term by being left out of all the help that millions of others have received, I only require a small grant, loan or amount of working capital to get back on my feet, yet as I have already mentioned have not yet received a penny. Staying optimistic is extremely hard at present and I really just want to get set up again, working & paying back into the financial cogs which make this country turn.

 

I really urge the exchequer to look again at the 3 million freelance and small business operators who established in the 2019, have not received a penny of help and as such may lose their livelihoods and be far more of a burden on the system over the longer term.

 

We live in a progressive country, excluding anyone who decides to set a business up over a whole year period is not going to progress the economy moving forward and could cause far more economic harm than the government have clearly yet realised. Small businesses are what make this country turn, new business competition is what makes industry competitive & yet both of these things could be harmed beyond all repair without some serious, quick and fast intervention.

 

I am aware of many thousands in a similar position, and although Rishi Sunak and the government may consider that a small number in a country of 70 million people, when you consider the 2-20 employees involved, the services these companies support, the rates and taxes they pay, the rent they pay for the business property they fill, the mortgages they are paying among many other close nit components it is not a small disaster the country is looking

 


at. There are 3 million people who have received no help,if they don't receive the help they will default, close business, send more people in to unemployment which will in turn shrink the countries GDP which will effect the value of the pound, which then will of course have serious knock on effect to import businesses and trading partners and companies across the globe.

 

Over the long term cause far more of a burden on the system than if the government help with immediate intervention where it really is needed, small progressive tax paying business that was established in 2019 needs the same level of support every other tax paying resident has so far received.

 

We are progressive, we can get through this situation, we can come back stronger but the only way that will happen without more disastrous dominos falling over day in day out is if the government acts fast.

 

June 2020

 


 

Written evidence submitted anonymously

 

I am writing with regard to my daughter who has always worked, never claimed a penny in benefits. She even worked before and during University. She is living in a rented flat with her boyfriend and found a great new job to start 22nd March. She left her old job a few days earlier but Corona had struck. Her old employer would or could not reinstate her to furlough her, and new employer obviously couldn’t furlough her as she wasn’t even on their payroll yet. So that was it, end of her earnings with rent and bills to pay. She was advised by her local MP to claim UC and JSA but she was refused UC because her boyfriend was still getting paid and JSA is £74pw. So now instead of her salary of around £2500pm she now has less than £300pm to cover bills equalling over £1000.

This is putting so much pressure on her and the worst thing is the mental stress its causing. She shouldn’t be forced into this situation through no fault of her own. The sad thing is she is just one in over 3 million people who have been forced into this position through no fault of their own, and being punished for trying to better themselves.

I believe the government's actions in some cases to be unlawful. They are discriminating against people who resigned from a job expecting to start another one straight away. They are calling them 'trade-offs, fraudsters, collateral damage' and have now said that their actions 'against' them are 'defensible'.

I want them to retract all of these statements. I want my daughter to be treated fairly and not forced into poverty because the govt has not acted fairly.

The procedures are already in place to allow her to claim. The govt can see her earnings and the tax she paid on their system just as they can see the Self Employed earnings and tax. They can see when she was last paid and they can see her historical earnings.

Whilst I believe the Self Employed workers are entitled to the CJRS grant like any worker, I am simply trying to point out the fact that the Chancellor has permitted huge margins for fraud in the above scenarios but ignores this whilst trying to use the very same reason to avoid including employees who just simply had decided to move to a new job before they were aware of the lockdown situation yet to come.

I believe this to be discrimination. They have proof that employees held jobs in Feb/March 2020 but they do not have proof the self employed workers were still trading in Feb/March 2020 yet they are allowing the self employed workers to claim the grant and not the employees.

Further, it would be 'Indefensible' in any court to try to argue same.

It would also be 'Indefensible' in court to try to transfer the responsibility to claim the CJRS for employees who have recently resigned to ex employers. This is compounded by the fact that it was not made mandatory for the ex employers to do so. It is the UK Govt's responsibility to put support schemes in place for all legitimate workers affected by this crisis and the onus should never ever have been transferred elsewhere.

The employed and self employed workers have all paid their tax and national insurance to support this country all of their working lives. It is time for the UK Govt to step up and fairly support each and everyone of these taxpayers without any form

 


of discrimination or humiliation which appears unexplainedly and unforgivingly to have been the policy thus far.

I feel so worried for my daughters wellbeing and financial situations, as none of this was her doing. And when she is finally back in work she will once again be paying taxes to help this country get back on its feet. Rishi needs to make changes to include new starters and I implore you to forward our concerns to him and the situation we find ourselves in. Changes need to be made. Surely by supporting new starters now and taking them off of benefits will improve the economy.

 

In summary, the fact still stands that help is needed and people can’t be punished for trying to better themselves. It should not be a crime to move jobs mid March. They were all tax payers for years, have contributed to this countries economy and health state for years and now they have been excluded from the help they deserve and need and as far as I am concerned are fully entitled to. Mr Sunak was able to amend TUPE which everyone knows benefited his own family which is a disgrace in its self, but just proves that amendments can be made and must be made to CJRS to help the people excluded from it.

 

Many MP’s have told us that the government does not intend to alter the eligibility criteria for the CJRS and that millions have benefited from this scheme. But it’s not acceptable to play god with people lives, and cause depression and fear for the future for so many people, it is cruel and inhumane and we are all aware that supporting workers now will inevitably help the economy of this country instead Mr Sunak has forced millions on to benefits, risked them loosing homes etc and the drop in the economy of this country is the worst in the world due to corona and these people excluded are not now in the position to help the country back as they have been abandoned by Mr Sunak.

 

It is a very sad situation and one that must be addressed and the 3 plus million taxpayers excluded from CJRS must be supported.

 

June 2020

 


 

 

 

Written evidence submitted anonymously

 

Not ‘invited’ by HMRC for SEISS as I invested any profit I had back into the business, zero profits. I draw around £200 a week and have shown this on my submitted account. The SEISS grant was based on profit NOT shown drawings. I have had no personal financial help at all for my own outgoings. I have drawn from my overdraft facility to survive, whereas my staff receive 80% of their full income on furlough. This is discrimination against the self employed.

 

June 2020

 


 

Written evidence submitted anonymously

I started my business in June 2018, gradually building up my business, whilst dropping down to part time hours in my PAYE job (Baker at Asda).

I left Asda in March 2019, and my sole income since then has been from self- employment (as is recorded on HMRC system).

My first tax return, 2018-2019 indicated a 42/58% split in income weighted towards PAYE, after profits (before profits, I made almost £2000 more from self-employment, but obviously my start up costs were high). In 2019-20, my business grew and had a healthy turnover.

I am ineligible for:

 

 

With regards to the future of my business:

My income is now around 14% of pre-pandemic levels (due to having 1 funded child on my books) until August, then it will drop to 0%.

I have lost 3/8 of my contracted minded children, and the remaining 5 do not require childcare at present; they are unsure of when they will return, if at all.

I have had no enquiries for childcare as of yet.

 

 

I would like to continue Childminding, but I will have to look for other permanent work soon, as I have received no support. To enable me to do this, I would ask that the Government either allow me to access the SEISS based on 2018/19 tax returns but remove the 50% income barrier, or allow my 2019/20 tax return to be included in the calculations for the SEISS.

June 2020

 


 

Written evidence submitted anonymously

 

[…] are a small limited company; we are property developers, mainly concentrating on private residential properties in the […] areas.

 

We have traded profitably for over 30 years. We are not huge earners, but we’ve had good years along the way. Obviously our tax bills on those years reflect this fact!

 

My partner […] is the sole director of the company. I am a part time administrator as I also look after our home and children. Neither of us have had to rely on any kind of assistance in the past.

 

[…] has always employed labourers and used the services of subcontractors for our many projects. We’ve had many apprentices and created many jobs for local people.

 

[…] takes an annual PAYE salary of around £8,000 and I earn around £5000 per year. We also employ a part time secretary.

 

In March 2020 ALL business stopped. Our income and livelihood stopped too. We needed to keep tendering for future business so could not furlough (this does not provide a liveable income in any case).

 

We have a mortgage, household utility bills etc. too.

The nature of our business means we do not need premises, as we can work from a home office,

 

However, in March we still had suppliers and subcontractors to pay. Our ‘savings’ are there to pay future business liabilities such as VAT and corporation tax. […] takes around £30,000 per year in dividend income, but obviously only if we’re profitable. This is also taxed as you are aware. This IS our income! We have no dividend income from any other source, as the Chancellor continually implies. This is just untrue and such an unfair assumption.

 

As time progressed it became very clear that we were in the sector of the economy that Rishi Sunak viewed as ‘collateral damage’!

 

We have been totally ineligible for any financial help at all. Universal Credit was denied due to us possessing some savings (to invest in the business and to pay future tax bills).

 

We have no premises and are not a part of the correct sectors to receive any kind of grant.

 

At the minute, we are working to secure business going forward, yet we have no income from this as it’s merely tendering for contracts that we may or may not win.

 

We have to use our savings for our mortgage, bills, food for our children… absolutely everything!

 


 

We feel this is SO unjust as we have contributed to society and the economy for decades. Why are WE means tested for Universal Credit when many of our self employed and employed friends are not?! Why should we incur debt in the form of loans when we really do not know if are businesses will remain viable going forward? Why should we anyway, when other citizens (some who have never contributed much if any tax at all!) are helped without question? All we want and need is to be treated respectfully and equally. This isn’t happening.

 

This time has been so very worrying and draining. This comes at a time too, when I am trying to keep our young children happy and healthy in lockdown, and I’m trying to successfully home educate them as well.

 

We feel we ought to be treated like the self employed (which we are!); it was Government and accountant advice that led us to operate as a Limited Company in the first place! Now we’re being penalised and treated like criminals. Our children need to eat too! They also need parents whose mental health isn’t deteriorating by the day.

 

What more can I say?

 

… other than we need backdated SEISS grants like everyone else… these will simply serve to try to keep us afloat whilst we tender for future business. We, and millions of other people, feel angry and sad at the same time, because we feel we have been DELIBERATELY mistreated and forgotten, as if we, our families and our businesses do not matter at all.

 

Thank you

 

June 2020

 


 

Written evidence submitted anonymously

 

Under current rules I do not qualify for the Self-employment Income Support Scheme even though I have been 100% self-employed since October 2018.

 

This is due to the fact that I was employed for the first six months of the 2018/19 tax year before I started my business and so I do not meet the requirement of my self employed income in that tax year being more than 50% of my total income even though from October 2018 100% of my income was from being self employed. There needs to be a way that these first and second SEISS grants can be accessed by people who started their business late 2018 or in 2019.

 

I run a small consulting business working with in higher education. I started the business when I was made redundant from full time employment in September 2018. I have spent the last 16 months investing in and working every hour to build my business and have been successful in doing so. I have never claimed benefits. I have one member of staff and also bring in regular work from collaborative projects to three other businesses run by associates of mine.

 

In February 2020 I had a solid and healthy pipeline of new projects for 2020. As lockdown started in March, I lost every single project in my pipeline and have not managed to sign one single new project since. Having worked in similar businesses for many years, I would expect the busiest time of year usually to be from March to July – the end of the academic budget year. Many higher education establishments have cut or frozen their budgets and employment of outside consultants is currently not something they are able to do.

 

The only support my business has had is to be able to furlough my member of staff rather than make her redundant - so at least she is being paid something each month but now with employer contributions due, I will have to consider making her redundant anyway. She is the only earner in her household.

 

I have had to take a 3 month, soon to be six month mortgage holiday and I finally managed to get a bounce back loan after 3 long weeks trying.*

 

The only help I have been able to get forces me to take on debt I do not want. My husband was furloughed and so together we lost 60% of the family income after taking on a new mortgage and moving house in early March this year.  The stress and impact on our family has been and continues to be severe! I can’t tell you how desperate it felt when the government announced a second lot of help for those who had already received SEISS money without extending the qualification criteria to help those who had not.

 

We are now faced with finding a way to pay back the deferred mortgage payments and the bounce back loan while rebuilding my business. Others meanwhile are receiving grants to help their businesses - it is so very unfair. I have tried everything and I don't meet the criteria for any grant scheme as I don’t have a business premises, nor two members of full-time staff and am unable to apply for the first or second SEISS grant – the grant that should have been there to help me.

 

Please look into a way to help those people that started their businesses late in 2018 or after. There needs to be a way that these first and second SEISS grants can be accessed by those who either started their business in 2018 but didn’t qualify due to the 50% ruling or started their business in 2019 onwards.

 


 

*If you want evidence on the dire situation around the Bounce Back loans and the poor behaviour of the banks, just look here https://mrbounceback.com/mr-bounce-back-website-now-live/

 

 

June 2020

 


 

 

Written evidence submitted anonymously

 

The government decreed that all pubs and restaurants should close as part of the coronavirus measures and that measures would be put in place so that people would not be left behind. As a self employed chef I am obviously massively affected by this as my income stream was taken away overnight, and yet I have been totally left behind. This also affects many, many other freelancers and self employed people.

 

My current situation is this:

 

 

Some of my work is as casual labour, and through temp agencies, who pay me through their PAYE payment system. I have no permanent contract with any of them. I can pick and choose what I do, and am registered with HMRC as self employed, but they have used this loophole to deny myself and many others the grant.

 

 

 

I cannot claim anything it seems, so I have no income but have been denied any state help. This loophole needs to be closed, which would help myself and tens of thousands, maybe several millions, of others, who are suffering because of it though no fault of their own.

 

June 2020

 


 

 

Written evidence submitted anonymously

 

1         Support to businesses and Financial services

 

1.0        How effective has the Government support been so far in terms of coverage and speed?

 

1.0.1      The speed of Government response generally was good. There appeared to be understanding of the implications for COVID-19 on the economy, and schemes to support that were started in good time.

 

1.0.2      The Government schemes appeared to be generous, but highly-dependant on a swift exit once the conditions appeared to allow people to go back to work.

 

1.0.3      The support for PAYE employees that could be furloughed was great, and the extensive loan options for building-based businesses should be good to support and regenerate effective organisations, but only to prolong the pain for those that have marginal business plans.

 

1.0.4      Limited Company Directors / working from home, the only option is a loan – which makes no sense as on top of income tax rates, I would have to repay the loan, with an interest charge as well. To take out a loan simply to cover lost income (which it would be in my case) is not an effective manner to run a business. An equivalent grant to furloughing (where PAYE will be paid) is the fair option, but the government ignores the legitimate use of dividends as income, to calculate financial support at this time.

 

1.0.5      As a Limited Company I hold no product stock; I am relying on skills and experience in the Knowledge Based Economy to carve out a business. If you were to look into my background, you would see that I only became a contractor due to redundancy in 2015 and have successfully managed to deliver nationally important defence projects in the intervening time.

 

1.0.6      My business is based at home, with me travelling to the Client’s factory to provide value there, and I have no non-loan support available to me, which for the reasons above is non-sensical when the Chancellor of the Exchequer said that the support would not discriminate in this manner.

 

1.1       What gaps are there for businesses within the schemes?

 

1.1.1      When lockdown occurred in March my contract with my Client ended two weeks later as a result.

 

1.1.2      Due to the way that I employ myself through a Limited Company and the fact that I pay myself a mixture of PAYE and Dividends the options were limited.

 


 

1.1.3      To get the type of work that I’ve been doing for the last few years, is it necessary to be a Limited Company. To work as a Sole Trader would prohibit me from working in nuclear defence as I have been recently.

 

1.1.4      All taxes are calculated annually not monthly which is another impediment in the system.

 

1.1.5      Using the .gov website to apply for the Self-employment Income Support Scheme (SEISS), and submitting m Government Gateway account number, I was told I was ineligible for this support.

 

1.1.6      If I were to furlough myself, then due to my annual tax calculation and only being able to consider the PAYE option, I worked out I was probably only due about £40/week – which is less than my weekly food bill for 4 people, let alone the other bills I’ve got coming in.

 

1.1.7      I looked at Universal Credit, but they take into account the amount of money I retain for my tax bill, making me ineligible.

 

1.1.8      So, for the last three months I have been relying on savings, the fact that my bank has paused my mortgage for three months (though this is coming to an end on 1st August 2020), and hoping that I will find additional work sufficient to replace the work that I lost.

 

1.1.9      There is little work in my sector (Technical Project Management) at this time, making the prospects for new work very slim. Companies are wary of taking transferrable skills that I have, and applying them to their industry, if I’ve never worked in that industry before.

 

1.1.10  For instance, there maybe a significant amount of say, Construction work that needs a Project Manager, but as I have never worked in Construction, I will be unlikely to get a job that way.

 

1.1.11  The impact of IR35 reform is also getting in the way as the number of temporary / contract jobs are significantly reduced, with the emphasis on permanent employment. This has the effect of slowing the jobs market to a snail’s pace, inhibiting recovery at this time.

 

1.1.12  In comparative terms, a PAYE employee has been eligible to be furloughed on up to £2500/month (~£600/wk). This is all unfair and goes against legitimate taxation rules that I was encouraged to use in the course of my work.

 

1.1.13  Now that the furlough scheme has been closed to new applicants, its use is past history and thus not applicable.

 


 

1.1.14  I do not earn enough as a business to benefit from a VAT reduction / holiday, and even if one were offered this is a post-business option. I have to have business to generate the income to be liable for the VAT. A grant at this time, to me in my position is the only logical stop-gap to get me to the point where I get another job.

 

1.2       Is the financial sector supporting businesses enough? Are businesses getting the right advice on which grants/loans to access?

 

1.2.1      Any advice on where to go for business help has been organic, rather than organised. I know of no single repository of information that I can go to, or has been advertised for, the full range of business support options available to me.

 

1.2.2      To provide an example, I investigated business grants via my local authority (West Suffolk) only because I follow them on Twitter and they sent a Tweet out reminding that if any business needed support then there was a closing date (29th June). If I hadn’t had that Tweet I wouldn’t have even known there was the possibility of grant assistance.

 

1.2.3      However, it was all futile as being a working-from-home Limited Company, West Suffolk require a Business Rates reference, which denied me again for any funds.

 

1.2.4      All I am asking for is a comparative grant to replace lost income, in the same manner that Permanent Employees have received under the furlough scheme, where all of their income has been taken into account.

 

June 2020

 


 

Written evidence submitted anonymously

 

Executive summary

 

•    Bios and reason for submitting evidence (Exclusion from SEISS)

•    Impact on my personal economic situation and well-being

•    Impact on Uk Film and TV Industry

•    Recommendations for action

 

 

1.  My name is […] and I am a freelance video editor working on fictional films and documentaries about social issues.

 

Due to the loopholes in the new Self-Employment Support Scheme (SEISS), I am not eligible for the government grant. This is because I started freelancing in November 2018/19, so during that fiscal year, less than half of my income was coming from Self- Employment.

 

I currently find myself without any source of income. I am based in London and usually find work independently, through personal contacts and ads on social media. The job offers available, though, have completely disappeared since March, because companies have put productions on hold due to Covid-19. For example, a film and a commercial I had to edit in April have been canceled until further notice. My last employment, an edit of a short doc for the Department of Health and Social Care, ended on the 24th of March, and since then, I haven’t been able to find new commissions. I regularly check in with clients and on online platforms, but the market is frozen, and work will probably not resume until after the summer.

 

2.  In my opinion, the government has been unsuccessful in plugging the gaps in the support and is ignoring complaints from MPs, social groups and media.

 

The Uk constitution protects individuals from unfair treatment and I believe the government should provide equity of support to all taxpayers. Besides, the lack of support my colleagues and I are facing is also having a huge impact on our economy and mental health.

 

As I started my sole-trader business just recently, I made an initial investment for equipment and I have limited savings.

I had to ask my landlord a deferral of the rent, that I will have to repay, accumulating debts. I have reduced my expenses to a minimum and I use my savings to cover my living costs. I was hoping to start a family soon, but that now relies only on my husband’ s ability to support me and our future child. He is luckily still working but had a reduction of salary, whilst many people have been furloughed in his company.

The future looks much more uncertain and I feel anxious about my career and my ability to come back to work. Depending from my husband has also undermined my sense of independence and self-esteem. Besides, the scheme is out-of-date, as it provides support

 


to people that were freelancing 2 years ago. For example, in my case, during the fiscal year 2018/19 I was employed for most of the year, but I am now working solely as a freelancer; basically the scheme discriminates newly self-employed, PAYE freelancers and directors of small limited companies.

 

3.  This situation also jeopardises the ability of the Film and TV industry to recover. In 2017, the sector in the UK generated a turnover of £14.8 billion, providing a significant value for the UK economy. Its direct contribution to UK Gross Domestic Product (GDP) was £6.1billion.

Despite these great results, a recent survey by The Film and TV Charity found that 74% of film and TV freelancers were not eligible for government support schemes. Many talented film and TV freelancers are considering leaving the industry, and this will probably have long-lasting consequences for a very successful sector in the UK economy.

 

4.  Taking all this into consideration, I urge the Government to update the Self-Employment support scheme. Among solutions, that should be backdated to March 2020:

 

-      A new Freelance Worker Income Support Scheme could use HMRC data to calculate average earnings for people who had a combination of PAYE and Self-employment contracts in 2018/19. This would cover anyone who cannot be furloughed by a current or previous employer.

 

-      Start-ups should be allowed to submit 2019/20 returns during April and have their income assessed on this basis, to cover those who have only declared as self-employed in the last year (since April 2019)

 

-      The government should temporarily suspend the Universal Credit savings cap so people with savings of more than £6,000 are not penalised when claiming.

 

-      Self-employed workers who have taken maternity/paternity or sick leave in the last three years should be allowed to choose the highest earning year rather than the three-year average when calculating qualifying income, or exclude certain periods from the calculation.

 

-      The £50,000 annual profit cap should be raised to only exclude the genuinely rich. Thank you for reading and best regards,

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a self-employed singer and entertainer I work mainly in care homes around Surrey and local social clubs. I made the decision to become fully self-employed in August 2019.

It has been my ambition for many years to return to my previous career as a professional entertainer. In July 2018, having spent many thousands of pounds of my own money over the previous few years training my voice, I started working in care homes providing entertainment to residents. I steadily built up a reliable clientele and in August 2019 I decided to leave my PAYE job to give me the freedom and time to continue to build my business as an entertainer. This was a good decision as I continued to grow the number of booking steadily and other opportunities were opening up for me until the pandemic hit in March. This was a serious business venture that I have dedicated myself to for many years and was starting to see the beginnings of the fruits of my labours. My last gig was Friday 20th March, I watched as all my bookings and everything I had worked for evaporated as we went into lockdown.

As the majority of my income for 18-19 was PAYE I am not entitled to SEISS, even though I have paid tax for over 30 years, I have been furloughed from a part-time PAYE job that is currently paying me £15.24 per week, along with

£62.50 per month from a cleaning job, this is my only income. The money I have in the bank from the sale of a house that I had been dipping into over the last few years to invest in myself, buy equipment and set up my business, means that I am not eligible for UC. Although in a couple of months this will no longer be the case, I am having to use this money to support myself completely. This worries me enormously as my income has never been great at the best of times, so there is very little spare cash, having to use this money to support myself means that I will not have funds available for any future problems as I do not expect that I will be able to replace this money.

It seems incredibly unfair that I and others like me are getting no support what-so-ever due to bad timing, having funds in the bank, not being in a PAYE position, when many are getting a lot of financial help that is not means tested. This situation is no more our fault than theirs.

I was subsidising my income as an entertainer by working in the hospitality areas of a local racecourse, promotional campaigns and tactical work. I have not had any start up grants or loans, I have taken full financial responsibility for my career choice and made many sacrifices along the way. The fact that I was doing so well and realistically looking forward to a profitable year ahead was exciting, re-assuring and very satisfying, but makes the situation even more heart-breaking.

I have no idea how long it will take me to rebuild my business, as I hope I will be able to, if I can afford to. I am extremely concerned about employment over the next couple of years as many people are being made redundant and I believe that it is going to take some time before the economy starts to recover.

I feel that Government have no interest in small sole traders like myself. They don’t see us and don’t care if we starve, literally, to death.

I think the way people like me have been treated is despicable and totally unfair. I do not understand why we could not have been given financial support based on previously taxable income regardless of whether that was earnt PAYE or SE or a combination of both. If it has been declared and taxed then it is legitimate income. Failing that a universal monthly standard payment to all, taxable so that at the end of the year those that have been able to continue working and done well through this do not profit from government handouts. Of course, there will always be some that manage to cheat the system, but that is happening even now anyway, whilst others are being left in tremendous financial hardship through no fault of our own.

I feel that the way the government is dealing with this situation is forcing me down a path of poverty that I have no control over. The future scares me, there is very little work available and so far no one has responded positively to the applications I have made.

June 2020

 


 

 

Written evidence submitted anonymously

 

Executive Summary

Introduction

1.       I am a partner in an LLP. Considering just the partners, we have between us, contributed at least 250 years of tax via previous and current employment. However, we don’t qualify for individual support which compromises our future viability. As an organisation we are 9 partners with 24 employees (11 CJRS). Our business area is Market Research. As an example of how coronavirus has impacted us, we can use May as an example.

Impact on us in May

2.       Overall billings were down 66% year on year. There has been a corresponding fall in project variable costs of 61%. The next major cost is salary, which for staff is PAYE. Furlough has reduced this by 42%. For Partners 'salary' is drawings. This has been reduced in line with billings by 66%. Admin costs have been reduced by 27% (principally by not travelling or recruiting). Then there is rent and rates which are 12.8% lower. The net impact on the LLP is a change in operating profit from 8% to -39%. Clearly unsustainable, without support.

Impact on Partners and options

3.       Partners, ineligible for SEISS (as used to, on average, earn £65k) are taking the hit and the partnership is effectively now in managed decline. We already had invoice finance. Being a service based industry we have no significant assets to secure loans against. Loans are also not viable as repayment would prevent drawings, providing no incentive to be a partner and would then lead to default.

4.       Possible outcomes, depending on time excluded and support given include:

1)      LLP closes to avoid debt: 33 people looking for work. Furlough just delayed the inevitable.

2)      Partial layoffs: We will be smaller but still have fixed costs. This will likely lead to 1.

3)      Intensive care: Business resumes. Growth stalled as Partners will be rebuilding their personal and the LLPs finances.

4)      Growth resumes: This requires parity of support. We’ll be better positioned to contribute to the recovery. We’ll be able to continue to employ others.

Our story is part of a much larger Macro issue

 


 

5.       4.1 to 4.3 are sub-optimal outcomes but this is what many small business in the UK are currently faced with. Their reduced spend will have an impact on larger companies that took advantage of the CJRS scheme. In turn their profits will be reduced and their employees will be reduced. Un-employment will increase and the recovery will be delayed.

6.       We are of course not the only people who have been excluded and we are equally concerned about their situation. Excluding millions from support establishes a feedback loop to the detriment of everybody. As your interim report indicated there are still significant gaps in the schemes.

Solutions

7.       We believe that, for us, the best solution would be to remove the £50k hard threshold on SEISS. We feel that fraud could have been addressed by reference to previous personal tax payments. A cap on pay-outs already exists. The evidence of prior earnings is already with HMRC. While undoubtedly some very high past earners might claim, the purpose of the schemes was to provide support, while the threshold effectively prejudges individuals current situation, as well as treating Self Employed differently from PAYE. The threshold also introduces additional complexity; this solution would simplify the scheme.

8.       For others the solution, to avoid fraud, would be to use prior tax records too. It is true that HMRC may have difficulty distinguishing dividend income from self employment versus investment. However, with an average FTSE 100 yield of 3.27% they are assuming that if this were a real issue that most self employed have massive share portfolios. New starters and others could be addressed in turn using prior tax receipts as evidence. Easy straightforward solutions have already been proposed.

 

 

June 2020

 


 

 

Written evidence submitted anonymously

 

Introduction

 

Between October 2018 and February 2020, I worked as a Contractor/PAYE Freelancer through an umbrella company and during that time paid tax and NI through PAYE. While I believe that in real terms I was self-employed (as I was paid only for the days I worked and received no employment benefits), the umbrella company has confirmed that as a result of IR35 Regulations, I am 'deemed' to have been employed which means that I am not eligible for the self-employed scheme.

 

Sadly, as my contract ended on 28 February (just the natural end, not C19-related), I am not eligible for the Job Retention Scheme either. Additionally, as I had managed to save in excess of the threshold for claiming Universal Credit, I am ineligible for that too (money I saved to see me through between contracts and for my wedding later this year).

 

So, despite all the schemes and grants available I will fall through every support net despite contributing c. £43K of my income to the system over that 18 month period while working as a Contractor. Of course, this figure does not include my contributions to the system in the preceding 35 years of my working life.

I am now trying to live on £75 per week Job Seekers Allowance.

Job Protection Scheme and Self-employment Income Support Scheme


 

As stated above, I and millions of other PAYE Freelancers are not eligible for either scheme. We are not ineligible because we have not contributed to the state, but purely as a result of the method by which HMRC collects our contributions. Our ‘deemed’ employment status (despite having no employment rights in law) makes us ineligible for the self-employed scheme and the very nature of short-term contracts make us ineligible for the JRS.

The Government has previously defended its position by lumping the three million excluded people into a homogenous group and stated that it is ‘too complicated’ to untangle their tax affairs. Please note that in the case of PAYE Freelancers/Contractors that PAYE is deducted at source and paid weekly or monthly in line with their pay. This is a nothing more than a smokescreen on the Government’s behalf. HMRC has our taxes and they know how it was calculated.


 

The Job Retention Scheme, in particular, has had limited effectiveness in maintaining employment. We have all seen the headlines where large organisations have furloughed staff and are now beginning the process of making thousands of people redundant. Has the scheme just delayed the inevitable and made the Government’s response look better than it was in real terms? Additionally, there is a lot of anecdotal evidence that many employers have abused the system and have claimed wages for staff but have continued to make staff work.

 


 

At the end of May, the Guardian reported that one half of the country was broke while the other half is richer than ever. I think this demonstrates how ineffective and inequitable these schemes have been.


 

Given that an estimated three million people (10% of the working age population) are ineligible for these schemes, I would say no.


 

I believe that the Job Retention Scheme has been too generous in that it has given people on furlough up to £2,500 per month while they are able to take on other work. The SEISS has also been too generous in that it has allowed people to receive the same level of grant while allowing them to generate income.

Both schemes have not been generous enough to provide support to everyone. What is the Government’s rationale in supporting some people and not others? Is this not state-sponsored discrimination?


 

The Government has been totally unsuccessful in plugging the gaps in the schemes. In late March and early April I wrote to the Prime Minister, the Chancellor, the Chair of Treasury Select Committee, Scotland’s First Minister, the Leader of the Opposition, the Shadow Business Secretary and numerous commentators and journalists, my List and Constituency MSPs, and anyone else whom I thought would listen. With the exception of the Leader of the Opposition and the Shadow Business Secretary, I am still awaiting acknowledgements and responses. The Government is well aware of the issues but has refused to engage with the electorate.


 

Your interim report accurately identifies the gap in support in relation to Freelancers and I agree with the statement that this “cannot be right”.


 

Not being a public finance expert I am unable to ascertain the future viability of the schemes, however, I believe that if the Government closes down the economy then it must provide financial support to everyone affected by that decision, otherwise, we will start to see increases in the number of confirmed C19 cases and subsequent deaths as people are forced to work in order to put roofs over their heads and pay bills.

 


 

 

 

The Government must provide support to everyone who has been affected. As lockdown and trading restrictions are lifted and businesses are able to trade again, their support should be reduced.

Other Government Intervention


 

The Government must also consider State Aid and the impact of providing financial support for a business with profits less than £50K and the lack of support for a similar business with profits of

£50,001 and above.

This crisis has highlighted the huge injustice in relation to IR35 Regulations. Contractors and Freelancers are forced to work and pay taxes under this system despite having no employment rights (no sick pay, maternity pay, redundancy or holiday pay, for example). The House of Lords was right to request a rethink on this unfair and unjust legislation.

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a self-employed dance teacher part time (term time only) and also have an employed part time position, both as important each other to make up full time work. I have not received any financial support due to the following:-

 

To work out your eligibility we will first look at your 2018 to 2019 Self Assessment tax return. If you’re not eligible based on the 2018 to 2019 Self Assessment tax return, we will then look at the tax years 2016 to 2017, 2017 to 2018, and 2018 to 2019. Our records show that your trading income over the past 3 years is only 40% of your total income.

My income for the past three years is as follows:- Trading: £24,689

Non-Trading: £36,965

 

As you can see both are not large amounts. On average for self employed £8229 per year and employed £12321. Both roles are part-time making up full time (so I can work around child arrangements etc.). If the amounts were the opposite way around for someone else they would be getting help and more income, how can this be equality?

 

My self-employment work is term time only due to being a dance teacher, teaching 11 weeks per term, therefore during the Easter to Summer term for example (when the lockdown has hit) it is my main income. On the averages that have been provided - £8229 for trading profit if this is divided by three then my income for each term would be £2743.00, whereas if you divide my non trading income

£12321 which is £236.94 per week and £2606.34 for the same 11 weeks. Therefore, during the time when we have been in lockdown and I have been unable to teach dancing my trading income is more than my non trading income.

 

How will I be able to get my business back up and running which I can’t see happening until at least September due to being a dance teacher with no help and when I am now just getting just over £1000 to live on? How can this be deemed as fair when if I was employed with this combined income and not working I would be getting help and without a business to get going again. I feel the way I work is being discriminated against. I am not earning anywhere near the £2,500 so why am I not getting any help?

 

I feel the criteria is very unfair and should be looked into on an individual basis and not just looked over because I don’t fit into a certain box. We all have different circumstances that need looking into to ensure we are treated fair and equal which I feel is not the case.

 

July 2020

 


 

Written evidence submitted anonymously

 

Thank you for asking for evidence regarding the self-employment grant scheme, for those of us unable to fall into the non-eligible category.

I felt that my case for not receiving it was very unjust.

I started my business in February 2018, after I lost my job, at the age of 60, I felt that I would struggle to find employment and as I enjoyed doing my job (lawnmower repairer), I engaged in starting my own business, I didn’t go and claim job seekers allowance or any other kind of help.

I started up by using my savings to live off and as work picked up and I was finding my feet within the business world, it dropped off and I decided to draw down some of my pension to help me through, as tools and equipment are not cheap, nor advertising. I could of taken out a personal/business loan, but I didn’t want to put myself and family under pressure, thankfully now, I would have been worrying about paying it off each month. Obviously, this was the reasoning that led to me be being refused the grant, which I feel is very unjust.

When I spoke to someone from the HMRC, I was told there is a strict criteria of government guidelines under which they had to follow, but in some circumstances surely common sense prevails.

 

 

I have worked all my working life, never had benefits, so you can see why this sticks in the throat a bit!!

June 2020

 


 

 

Written evidence submitted anonymously

 

SUMMARY: AS A SELF-EMPLOYED SOLE TRADER, I HAVE – SINCE JANUARY 2019 – BUILT A SUCCESSFUL BUSINESS. THE LOCKDOWN IMPOSED AS A RESULT OF CORONAVIRUS IMMEDIATELY RESULTED IN AN 86% DROP IN INCOME. AS I STARTED SELF-EMPLOYMENT IN JANUARY 2019, & THE GOVERNMENT REFUSE TO TAKE INTO ACCOUNT THE MOST RECENT TAX RETURN, I DO NOT QUALIFY FOR SUPPORT. WHY HAVE I BEEN EXCLUDED FROM A SAFETY NET AFTER PAYING TAX MY ENTIRE WORKING LIFE?

 

 

What problems (if any) are individuals facing in claiming support from the Self-employment Income Support Scheme?

As a result of the COVID-19 situation the UK government has closed down many industries. I am Self-Employed in the Culture & Tourism sector, which has been particularly badly affected.

Unfortunately, I am not entitled to any government support. Here’s the background:

 

In January 2019, after 15 years working full time in this industry – I pursued my ambition to set out as self-employed. I had a successful 14 months trading taking on consultancy work and contracts that brought in income an average income (before expenses and tax) of £3,500 per month. In February 2020, I secured an additional contract that would have seen average earnings increase to £4,500 per month.

Unfortunately, the closure of the industry has had a profound impact on my earnings. Since the close down, my income has reduced by around 80%.

The government class my status as a ‘newly self-employed’ Sole Trader. As I do not have my own business premises (I work from home), I am not entitled to any Small Business Support. I left full-time permanent employment in January 2019, taking up full-time self-employment that same month, the government's current calculations on the Self-Employed Income Support Scheme (SEISS) do not take into account the most recent tax year (2019/2020). As the government only consider earnings from the 2018/19 tax year, I do not reach the 50% threshold for self-employed income (as most of my income in that year came from PAYE employment). However, since January 2019 my Self-Employment has been my only form of income.

 

 

Is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that fraudulent claims are detected?

No. The Government have said that the reason they can’t support a claim like mine is because it is “too complicated” and “open to fraud”. I wholly resent being labelled a tax fraud with no evidence. Placing arbitrary rules, that are not in line with Government the equivalent CJRS does not decrease (nor increase) the risk of fraud.

 


 

 

 

 

How successful has the Government been in plugging the gaps in the schemes?

 

They haven’t been successful. They have had a knee-jerk reaction this crisis and then refused to acknowledge that they have left 1million (Governments number) / 3 million (independent analysis) behind. We have been left ignored – I would expect a Tory Government to not care about those they leave behind, but I would never have expected them to leave behind the Self-Employed and Small Businesses on such a scale. They are not the party of business as they’ve claimed to be. There reasoning behind missing so many people is that it is “Too Complcated” – this same reasoning would not be an excuse when it comes to me avoiding my next tax bill, or would it?

 

 

Is this in any way fair?

 

NO. IF I HAD STARTED MY SELF-EMPLOYMENT JUST A FEW WEEKS EARLIER I WOULD HAVE MET THE (RIDICULOUS & INHERENTLY NON-SENSICAL) “50% THRESHOLD” AND BEEN ENTITLED TO A GRANT OF £14,250 – RIGHT NOW I’M ENTITLED TO £6.82 A MONTH ON UNIVERSAL CREDIT. MY INCOME HAS REDUCED BY OVER 80%, I’M ‘THROWN A BONE’ OF UNIVERSAL CREDIT THAT IS NOT FIT FOR PURPOSE, WHILST OTHERS WHO ARE SELF- EMPLOYED – AND WHOSE INCOME WON’T HAVE BEEN ANYWHERE NEAR AS AFFECTED - ARE ENTITLED TO £14,250 AND MUCH MORE THROUGH OTHER GRANTS AND FINANCIAL SUPPORT. THIS IS NOT RIGHT. I SHOULDN’T EVEN BE HAVING TO EXPLAIN THIS TO YOU. IF THE GOVERNMENT DON’T CORRECT THEIR COURSE, I WILL TAKE THEM TO COURT – I GUARANTEE YOU I WILL WIN.

June 2020

 


 

 

 


 

INTRODUCTION


Written evidence submitted anonymously

 


 

This evidence is being submitted on a dual impact basis for […] and […]. […] is currently unemployed after having been made redundant and […] is a Company Director of two small Limited companies: […] specialising in IT Consultancy Services; and […] an online Skateboarding Sports Goods retailer. Both parties have been excluded from proper support.

 

NB We would prefer our evidence to remain anonymous in that we are happy for it to be published, but not our names or any personal details about us.

 

The salient Terms of Reference we seek to address are as follows:

 

•   Where has Government support been too generous and where has it not been generous enough?

•   How successful has the Government been in plugging the gaps in the schemes?

•   What gaps in coverage still remain and are changes required to increase their effectiveness?

•   What gaps are there for businesses within the schemes?

•   Should the Government intervene more actively in terms of state aid, bail-outs and its industrial strategy?

•   What will be the impact on inequalities within society and how should the Government address inequalities that may have been exacerbated by the crisis?

 

SYNOPSIS

After 2.5-yrs employment, […] was made redundant on 17 January with the 29 February her last day of employment. She was not furloughed. She asked her employer twice to consider furloughing her but was twice denied. New employment in her area of expertise was looking promising then all of a sudden these opportunities vanished overnight. The only income she is able to receive is £74.35/wk JSA. She did not initially submit a claim as she was expecting receive an offer.

 

She is now reliant upon her partner, […] who is a Company Director of two small Limited companies: […] and […], both of which are based at home and both of which have been affected by the Covid crisis. He is now having to siphon business funds for personal use in order to compensate for the loss of […] income to pay for food, bills, mortgage payments, burgeoning debts and such like. This leaves the businesses in a precarious position.

 

He falls into the ‘Excluded’ and ‘Forgotten’ category for a number of reasons. He is paid partly by annual PAYE and in dividends. He is ineligible for business grants due to qualifying technical criteria such as not having business premises. The only ‘support’ he is eligible for is greater debt by way of a BBL (Bounce Back Loan).

 

In both cases, the government has not been generous, nor have they been successful in plugging the gaps to date. The support has been disproportionately distributed leaving many in dire need with nothing whilst some with need, but not necessarily dire need, in a comfortable position.

 

DETAIL

Since […]’s redundancy came into affect, new employment in her area of expertise has entered an unknown period of stasis and even when things begin to rouse from this dormancy, the market is going to be overwhelmed and ultra-competitive, which is what she is already experiencing.

 

To date, all of her recent job applications have not been successful - not even the many contract tracer vacancies. Some example of the responses she has received since the escalation of the Covid crisis are given below:

 

“Thank you for your application for the position of Marketing Manager at xxxLimited. Due to the ongoing situation regarding covid-19, the company has taken the decision to place all recruitment on hold until further notice”

 

“We would like to thank you for your application for the position of Marketing Manager here at xxx Group. Unfortunately, the vacancy has been placed on hold until further notice. Should this vacancy become active again, we will contact you to check whether you still wish to be considered as an applicant.”

 


“Thanks for the email. No news as of yet I’m afraid to say so starting to think they may have cooled on the recruitment of this role. I will follow up tomorrow and get back to you as soon as I hear anything. Sorry for the delay on this.”

 

“Thanks for your email. The role is currently on hold but we may re-open it later in the year. I have received your application though and will keep it on hold (if ok with you) until then.”

 

And so forth. At the same time, new job posts simply vanished overnight. Many recruitment consultants she was dealing with directly were themselves made redundant or placed on furlough. When, or if, the jobs market does bounce back, it is going to be overwhelmed and ultra-competitive and it is anticipatesd that roles in her specialism will be very few and far between for a prolonged period of time.

 

The issue she has is that she did not choose to became unemployed. She did not leave her employer, […], out of choice. She had not submitted a claim for benefits because prior to the Covid crisis worsening things were looking promising. With all new opportunities having withered away she had no choice and luckily it was backdated. However, her entitlement is a mere £74.35/wk. She and […] have no back-up funding as all reserves went into the purchase of their property in March 2019 before it became too late to get onto the property ladder due to age.

 

She twice approached […] to ask if they would consider furloughing her but was twice denied. She had witnessed others announcing on platforms such as LinkedIn that their previous employers had kindly agreed to do so for them. Furthermore, these were people who had left of their accord to start a new job. One example is given below.

 

“A call out to all employers : A member of staff, who’d just resigned to work for another consultancy, sent me an email last week suggested that as she worked for us on 28th February could we re-employ her and put her into furlough, as her new employer was unable to bring forward her start date, and had extended her start date to May due to Covid-

19. It was a no brainer, morally, so I’ve re-employed her and put her on furlough, so at least she gets 80% of her former wage from April until her new employer actually starts her employment or CJRS finishes. No one can live on fresh air alone, it costs ‘us’ nothing and means the world to them, even ones that chose to leave you - do what’s right where you can, help others where you can.”

 

Whilst glad that the government has helped many because if not, the country may well be in a far worse situation, the disappointment is that whilst many have benefitted greatly from the support made available by the government, others have not. The government has been extremely generous in some areas yet not so much in others. In addition, the power and decision as to who benefits from the CJRS scheme is at the employers discretion, which is open to discrimination and abuse. This has resulted in an imbalanced distribution of support. The disparity between some receiving 80% of their salary and others receiving £74.35/wk is huge.

 

In terms of […]’s situation, he has been heavily impacted in that the majority of his existing clients from […] are abroad and he has been unable fulfil his contractual duties due to travel restrictions and lockdown. In addition, he has not been able to secure new business as a result of the shutdown and companies deciding to withhold spending for the foreseeable future. Furthermore, he also falls in the ’At Risk’ category, which meant that whilst […] was willing to go work in supermarkets, farms, care and residential homes or anywhere, she would increase the risk of bringing the disease back home to him. NB she falls into the BAME category and is 43 years of age.

 

As regards to […], the closing of skate parks combined with lockdown measures and the actual and potential loss of disposable income of the main client base has all negatively impacted upon sales.

 

Other than the bounce back loan, which is essentially the addition of a burgeoning debt as is the mortgage holiday and council tax deferment, he does not qualify for any of the benefits available due to qualifying criteria technicalities such as business rates and his income being dividends and annual PAYE etc. He is now forced to have to take money out of the business to make up for the loss of […]’s income. Either way, both […] and […] are at a continued loss.

 

Further to the above, the system penalises individuals who are not formally partnered in two ways ([…] and […] are not married or civil partnered but are cohabiting as they have been since 1998). The first being that one is not judged as an individual in their time of need as despite not being married or civilly partnered, the other party’s income is taken into account for support such as Universal Credit. The second being that if one party dies, the other is not entitled to anything.

 

The ramifications of this dire situation on both individuals and their family is severe worry, stress and anxiety.

 

RESPONSIBILITY & ACCOUNTABILITY

 


 

Understandably, it has been a testing time for both Rishi Sunak and Boris Johnson in having to deal with the tumult that ensued shortly after they had taken up their positions of Chancellor and Prime Minster, respectively. However, with the United Kingdom having one of the most deaths per 1 million population, the questions as to how quickly the government responded to and how effectively they handled the crisis must be raised.

 

Should the government hold some accountability for the suffering that the Excluded and Forgotten are currently experiencing? Particularly when support has been selective, perhaps even discriminatory? Should the expectation really be that that those who have fallen through the gaps will likely have to pay for the governments shortcomings with every last drop of blood through greater taxes and reduced business whilst continuing to prop up the supported using their tax contributions paid over the years, despite not having benefitted themselves nor given a lifeline? This situation can be compared to giving your very last drop of blood to those who have 80% of theirs.

 

REMEDY

There is still time to recalibrate the balance between fairness and unfairness. The government could provide further business support packages, in particular grants on par with the support that others have received. The support should not be discriminatory and inequitable. Budgets from elsewhere could be redirected into the support for example Foreign Aid, HS2 or painting of planes.

 

Jobs could be prioritised for those not in employment as a result of having lost their jobs due to Covid 19. Perhaps the application process for jobs in the Civil Service could be simplified. A further remedy for this who have been severely affected could be given a backdated basic income that is on par with the CJRS scheme. Maybe exclusion from this years Council Tax liabilities. Or one or two years of paying no tax.

 

The disparity between differing councils’ qualification criteria should also be investigated. For instance, some businesses have received two grants. Support has varied across differing jurisdictions for example one business without business rates operating under one Council has been gifted a grant whilst another business offering the same services and also operating without premises under a different Council has not.

 

If the current situation is not remedied soon, the government should expect to see an increased burden on welfare spending as many of those who are close to the edge of destitution and who have not yet fallen may well become dependent on the state for many years to come.

 

June 2020

 


 

Written evidence submitted anonymously

 

Self Employed Driving Instructor

 

I present to you my submission for evidence for myself as a self-employed driving instructor and hope that my evidence is taken into consideration so that it may possibly assist others who find themselves struggling to keep their business afloat given the current crisis.

 

In 2018/19 I worked as a Senior Administrator for a local driving school which I then decided to stick with and train to become a driving instructor. I successfully completed all examination criteria to start teaching on a trainee licence. I started my first day of trading at the start of March 2019 during which I took in £1,600 into my business with a total loss of

-£3,648.47 which included my training fees and running costs (see below calculations for my self assessment).

A screenshot of a cell phone Description automatically generated

 

As this is the only year my business has been trading this made me inelagble for support as I was not considered ‘gainfully self employed’. However, in 2019/2020 I cut my hours in the office considerably so that my earnings approx. £1000 before tax.

 


During this year I have managed to build the business considerably and saw a net income of

£22,038.51 despite seeing all booking from 10 March 2020 onward be cancelled due to the uncertainty of the CV-19.

 

My family of 4 receive UC alongside my furlough office wage which has been a lifesaver and kept our family fed and the roof over our head. However, these support mechanisms will not allow my to continue as it currently stands.

As the business is receiving no financial support via grants from neither the UK or Scottish Gvt (through the Self Employment Lifeline scheme) I have been left financing the monthly running costs (albeit reduced where possible each month) with finances acquired through pre-payments and finances built up to sustain the business. However all pre-payments have been used to cover running costs over the past 3 months (approx. £400-£700 per month) I am required to work 60 hours just to get caught up and the business has now completely lost the safety floor of £2000 which was in it prior to the outbreak.

 

Once social distancing is removed instructors and examiners can safely return to work. Before lockdown the DVSA were struggling to keep up with their demand for tests – the earliest you could book a test was 3 months in the future.

Given the current circumstances it is not likely that driving instructors will be returning to teach pupils and work towards preparing them for a test (if they are available) realistically the end of September.

 

I have explored many avenues to see what support would allow me to return to work without having been affected as badly by CV-19 however thus far I have been completely unsuccessful and feel that I have been completely overlooked. I am confident that with ample support around £2,000-£4,000 (10%-20% of my net income for the year) would be sufficient to assist recovery, as this would cover the shortfall of business between March- Current date, thus allowing the business I have worked hard to build to continue to thrive.

 

June 2020

 


 

EIC0771

 

 

Written evidence submitted anonymously

 

Hello it would seem that I have fallen into the.( recently self employed category.)making me ineligible to receive any financial assistance from the government. I am a 54 year old bricklayer.I have worked all my adult life since school.either employed or self employed.On the 5/7/2019 I left a twelve year period of being employed on PAYE .however I did submit yearly tax returns for the purpose of claiming travel expenses.for working within the construction industry.for this purpose I was given a Utr (unique taxpayer reference )number to submit these claims .as I am now self employed .and recently submitted my tax returns for 2019/2020. Using the same utr number .since the 8/7/2019 I registered as a self employed sole trader .because I was having too sub contract to a contractor on a building site.I had to join the cis scheme .which allows the contractor to deduct 20% of my earnings .every two weeks when I am paid .which I am told he pays to the inland revenue every month .each month he gives me a pay slip which states my gross pay.my net pay.and how much tax I've paid .on the 28th of march our sites shut down .so with no work .no income and no help from the government.I applied for universal credit .but unfortunately .because my wife has a three day, a week. job for the nhs.and earns £900 a month ,our assessment came back at zero..as a result we've spent our savings to live off while I've been unable to work.thankfully I'm now back at work .laying bricks on a price .with the added complication off very strict. Health and safety rules.which I agree are important..has a negative effect on productivity and take home pay .when I hear the government say there helping everybody.it makes me wonder a what point I became a nobody .I know self employed people who have worked safely through the whole lock down

.and still received an extra 80%on top off there earnings ..I never like to moan ..but seems i can't .be helped. because I might be a fraudster.. i pay tax every week .even if it's part of some self employed scheme..hopefully you will be able to understand the points I've been trying to raise .and that they might be useful to you .thank you

 

June 2020

 


 

EIC0777


 

Written evidence submitted anonymously

 


 

 

 

Thank you for the opportunity to submit evidence to the Government as an individual on the economic impact of coronavirus. I am submitting evidence on behalf of all those such as myself who have been excluded and unable to benefit from any of the Government’s Covid-19 support schemes.

 

Specifically I’d like to present evidence to show that those PAYE made redundant at the outset of the Covid- 19 crisis have been harshly excluded from all additional Government support despite being in an impossible situation to find new employment or earn any income in the interim.

 

I present the following calculation to show just how large this support gap is:

 

•  For those who were lucky enough to have employers participate in the Job Retention Scheme (JRT) they will have received up to £7500 over the March-June, 2020 3-month period offered by the JRT.

 

•  For those made redundant in March, 2020 or later the value of Jobseekers Allowance (JSA), the only allowable support in many cases, during this same period has been just under £900 or less.

 

That cannot be right, given those receiving the £7500 support under the JRT will have a job to go back to in all cases and those whose employers decided not to participate in the JRT and make redundancies will only receive as little as £900 and have no job to return to.

 

While I do believe the Government has done its’ best to protect the economy, business and individuals form substantial losses, the current schemes offered by are simply not comprehensive and have unfairly excluded nearly 3 million of us.

 

As a solution, I suggest that most policy issues listed in your ToR can be solved with one simple solution proposed in this petition:

 

One-off Grant To Be Paid To Anyone Who Has Not Benefited From A Covid-19 Scheme

https://petition.parliament.uk/petitions/319899

 

On June 24, 2020 the Government responded to this suggested solution in the petition, but I feel that response is inadequate and does not address the massive inequity gap created by policy so far as I have spelled out in the above evidence.

 

The Government also suggested that even if JSA were the only available benefit to those PAYE made redundant, there were mortgage holidays and other benefits. This is note accurate. For example, a mortgage holiday is not a benefit at all, but a liability. It adds an extra debt liability and creates additional interest paid by participants to their lender. As such, it is an expense and debt creation vehicle for the consumer.

 

I kindly request the Government review this evidence which has meant a huge negative financial impact to so many as a result of current policy shortfall.

 

I hope the Government will use this opportunity to look at the above petition suggestions and implement some level of support for all those who have been entirely excluded from Covid-19 support schemes in the interest of fairness, duty of care and obligation.

 

June 2020

 


 

Written evidence submitted anonymously

 

 

I work in the music industry that in certain areas has been devastated by the pandemic where some are relatively unaffected.

 

Companies and musicians whose income derives from recorded music royalty income have seen a small level of disruption.

 

However, companies and industries that live performance is a large part of their business are devastated.

 

The government I feel has been very helpful to those that are not small limited companies. In fact some have profited.

 

However, there are only 3 major record companies in the world. SO employees of those companies aside, the vast majority of the people who work in the music industry are freelancers and small companies who are limited.

These are companies that supply services to the major 3 or are small independent stand alones.

 

The industry outside of royalty-based income is unpredictable.

Artists may tour sporadically; play a year on a year off. Hit records aren’t a guarantee. So almost every freelancer/small company is limited so we can pay ourselves the basic living wage but take income when we have it and when possible.

 

I don’t know anyone whose dividend is from share income.

And even if it was isn’t that disclosed on their personal tax returns?

 

So I have seen the government give grants to companies and individuals whose income hasn’t been/marginally effected in the way of SEISS and others who are desperate receive nothing.

 

Here is a real life example.

I know two session musicians who play for the same internationally famous artist. Both have young families and a mortgage and are best friends.

The world tour has been cancelled so they have lost all their income. One is a sole trader and has received SEISS.

One is a limited company and received nothing.

 

 

I’d also like to point out one very cruel and unfair situation regarding grants based on PAYE.

 

Of course most limited company directors pay the minimum PAYE annually under the allowance and then the rest in dividends (see above).

 

I spoke to a music photographer who is a limited company and he is receiving £520 a month.

 


My accountant said the HMRC website wouldn’t let me apply. I contacted HMRC to discuss why that was so.

 

I was told as my accountant had filed my annual PAYE return after the 19th March 20 so I wasn’t eligible to anything.

(That date being when the scheme was announced and therefore so a marker so people did not submit higher than normal PAYE income).

 

I asked the HMRC rep if my accountant had done anything wrong/filed late.

He said no, he has done nothing wrong; there was no obligation to have your PAYE filed before that date.

 

I asked why my previous year’s PAYE could not be used.

 

He said that would be the fair and logical way and under the SEISS scheme they are doing that but the Government has advised them not to do that for limited company directors.

 

So if I filed on the 18th March I could have the small but helpful £520 a month but having done nothing wrong, obeying the rules, I filed after and receive no help.

 

That is disgusting, unfair and deliberate.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I have been working for the bbc since 2013. Have a regular income specially since my promotion in 2018. I usually make between £1000 and £1700 per month depending on the amount of shows I work on. As a freelancer (which wasn’t a choice) the work load was very good and the projection of work since the Covid 19 was reduced literally to zero as we work with public. As a household (a family of 4 with 2 dependents), we lost over 26K of income. My husband was furloughed by his company which made me unable to qualify for Universal Credit. So it’s a hard loss of income without any other option to cover the loss. My Employer (the BBC) is stating that as a public funded sector we can not be furloughed, yet they are not offering redeployment, which was the condition of not furloughing the public sector, is to utilise the staff by redeploying them and pay them from the public fund in the ordinary fashion. It’s been 3 months without income. With my husband facing redundancy as his employer may not survive the crises, we might face a loss of our livelihood, including our house. We can not carry on like this with 2 kids and a considerable loss of income by no fault of our own.

 

June 2020

 


 

Written evidence submitted anonymously

 

o (specifically for having over £50k average trading profits)

 

 

 

Dear Treasury Committee,

 

1.      I am a sole-trader rather than a sole director of a limited company.

 

2.      I work globally but happily live and happily pay my taxes in the UK.

 

3.      The rollout of the SEISS was initially most welcome indeed. A fair few of my colleagues in the industry were helped by it considerably, some (sole directors of limited companies) less so.

 

4.      However, I have been discriminated against unfairly and, as so, find myself ineligible for government financial help. My trading profits between 2016/17 and 2018/19 tax years were unusually high. As so, my average trading profits saw me a little over the unfair and arbitrary £50k cap for eligibility.

 

5.      It is well reported now, that this bizarre upper limit is unfair, especially considering there is no such limit for those furloughed on the job retention scheme.

 

6.      The cliff-edge aspect of it is gutting for so many. I do understand the thinking behind the limit and the need to get help only to those who deserve it. It could have almost been slightly understandable if there were a sliding scale of help for those over the limit. However, to set the limit where it is and with such a hard cut off has hurt so many people.

 

7.      Then, to pour salt in the wound, the Chancellor’s overly political and glib statement that “the 5% of self-employed earning over £50k have average earnings of £200k” was a dismissive and all-round nonsensical justification for such a discriminatory cap.

 

8.      I did earn a lot then, yes, but not so much since. I also worked very hard for it, by touring the world for nearly 2 years straight in a job that takes its toll in more ways than most. It is common to tour for a couple of years and then take time out.

 

9.      For my wife and I, that time out was to spend most of our hard-earned savings on extensive IVF treatment abroad. Eventually, we were lucky enough to have our baby. Since then, what we had left had been slowly disappearing on nappies whilst I sought a new campaign to work on. That campaign was due to start March 2020. Due to Covid-19, all my work for 2020 was cancelled almost overnight. The industry I work in was shut down worldwide.

 


 

10.  My wife has now returned from statutory maternity leave only to be made redundant. We found we were ineligible for Universal Credit. To take out a loan would have been an absolutely stupid idea, considering there is no government plan on the horizon to resume the live entertainment industry.

 

11.  So, even with the mortgage holiday, not knowing when we can work again leaves us with the ever-growing prospect of losing our home in the New Year. This will be all due to the government unjustly excluding so many.

 

12.  I can normally expect to pick up other non-touring work in the UK, still in the entertainment industry. However, the UK government has shown no interest in guiding my industry out of the pandemic.

13.  The UK is one of the few countries in the world that hasn’t made a specific coronavirus financial contribution to the arts and entertainment industries.

 

14.  These are industries that will arguably be out of action well into next year.

 

15.  The UK is one of the only European countries that has not even made a plan to re-introduce live entertainment. This is an industry that is massively valuable to the UK’s economy; one that Britain is arguably world-leaders in, one that is essential for the happiness, mental wellbeing and even the very identity of millions of people worldwide.

 

16.  So the Treasury needs to think on and then take swift action

It needs to put in place a generous and world-leading financial aid package for all those in the arts and entertainment industry, one that stops vital services, artists, personnel and venues from going under before we are finally able to recommence (legitimately, not the dire prospect of drive-in concerts and theatres with half the seats removed). Whenever that may be.

 

17.  Perhaps more urgently, the government needs to do right by the 3 million+ self-employed taxpayers who have been unfairly discriminated against by being excluded from any government help so far. We are excluded for so many different reasons, not one of them justified.

 

June 2020

 


 

 


 

I set up as a sole trader in November 2018, as I came to the end of a 27 year employment, where I had paid tax via PAYE each year. My employment ended in March 2019 when my business was established enough to support my family and I. I completed my 18/19 tax return which showed some income from self-employment, but the majority for that year was from employment.

 

Consequently, despite being fully self-employed since March 2019, I have been unable to access any government support via the SEISS, as my self- employed income was less than 50% of my total income during 18-19. This is incredibly unfair.

 

My business as a gas man has been severely affected by Covid 19 and the initial lockdown meaning my income dropped to zero overnight.

 

We are not eligible to UC and have received no financial assistance via government channels. Although we have been able to get a mortgage holiday, this has been through necessity rather than choice. Despite the Chancellor saying that everyone would be helped, and nobody would be left behind, we have been, and we’re struggling financially and mentally as a result.

 

I have reluctantly looked into a BBL, however I have no business debt and am not keen on going into debt for something that has been totally out of my control. I have been on the waiting list to apply for a BBL with Starling Bank for more than 6 weeks now, so am beginning to think we’re destined to get no support whatsoever.

 


 







 

 

 

 

 

 

 

 






 

 

 

 

 


 











 

 

 

 

 

 

 

 

 

 

Massive gaps for self-employed and 3 million of us who have been excluded.


 


 



 

 


 

Written evidence submitted anonymously

 

Job Protection Scheme and Self-employment Income Support Scheme - Evidence Submission

Dear Sir or Madam,

I recently started a new business, offering email marketing support and advice to companies. Before I began this business, I worked full-time for 15 years, ensuring that I had sufficient savings behind me before taking the risk of starting a new venture.

Since the pandemic began, I have lost a considerable amount of work, my income having dropped almost 50% in March to May compared to the previous three months. I have zero income since the end of May. I still pay my mortgage, I still pay my bills, I still need to eat.

I have spent many hours looking at the various schemes on offer. However, because my business is relatively new and because I was sensible enough to have saved up enough to take this risk, I am ineligible for any help whatsoever. Instead, I must watch my hard-earned savings disappear, which means I am likely going to have to close down my business due to it no longer having the safety net of savings behind it.

Government support seems to have been far too generous for much larger companies. Although I understand the need to preserve employment, the support has not been in any way generous enough for SMEs, which employ over 16 million people (3 million of which have been shown to not be eligible for any government support).

It therefore seems obvious to me that the gaps in coverage which remain include grants for those 3 million self-employed who have new business and who have sensibly put some savings behind them. Although it seems as though I am now being hit particularly hard by the pandemic, I can foresee this situation continuing on for many months to come, which is why I am so disappointed to see the government beginning to wind down schemes that I wasn’t even eligible for in the first place.

Support packages should only be wound up when there is clear evidence that business is returning to normal, and not when politicians tell us that business has returned to normal.

The Coronavirus Corporate Finance Facility, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Larger Business Interruption Loan Scheme have not succeeded in any way whatsoever in preventing my once-viable business from potentially going under during lockdown. These schemes’ coverage have been incredibly poor – how can they possibly be deemed anything but, when 3 million workers are excluded?

The sectors that seem to be doing best out of all this are those which have previously thrived on online shopping. Having to watch the likes of Amazon rake in £billions, when they pay comparatively less tax than I, is particularly galling. Sectors such as outbound tourism seem to have all-but disappeared over night. Tourism seems to be a much under-valued sector in the UK and many governments seem happy to watch it decline rapidly, when, if it were a sector such as banking, it would have received help.

I would like to end by highlighting the effect of abandoning millions of self-employed on their mental health. Too often during lockdown have I seen self-employed individuals express suicidal thoughts. If this government is to be so callous as to abandon them financially, then the very least they can do is to offer mental health services for those, like me, who have been entirely excluded from help.

Yours faithfully,

 


A self-employed small business owner

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a single mother with 3 children aged 4,6 and 11. My employee has refused to furlough me. When I asked why the response was because they have offered me alternative working hours. Due to government rules and the closing of schools I am unable to go to work. I could not allow somebody into my home to look after the children. So offering me alternative hours was pointless as I cannot leave the children alone no matter what time of the day it is. Even as I am allowed a bubble my mum works full time on different shifts and has her 84 year old dad to see to who is also a little unwell due to being in a recent car crash, so she has chosen to understandably bubble up with him. Without my wages I have been surviving off my tax credits just scraping by.

June 2020

 


 

 

Written evidence submitted anonymously

 

I hope you are all keeping safe and well in the current scenario?              My name is […] and my family and I live in […] here in […] Wales.

 

Whilst i certainly appreciate the current scenario effects people in all sorts of different ways, i would like to touch upon the topic of Government support for self employed individuals such as myself.

 

I am part of a small partnership (Architectural Practice) as well as a small LTD Company Architectural practice (we have two practices which are required to deal with differing scale of clients) that are both based at the […], to which the current scenario (COVID-19) is certainly having an adverse impact on us.              Whilst we of course look to work remotely from home respectively, there is still a significant impact to try and overcome.

 

We have been watching with great interest as the various support schemes have been launched, to which unfortunately we do not seem to meet particular criteria to gain any financial support?              (including that available form our local authority) I/we are reluctant to utilise any loans (such as the Bounce Back Loan etc) albeit we accept this may be the only viable potion open to us.

 

I had hoped the Self Employed Income Support Scheme (as i regard myself as Self- Employed) may be the scheme that I/we would be eligible for, however due to the dividends payment element of the LTD Company practice unfortunately we do not meet the set criteria for this either.              It is particularly frustrating in that respect, as i do not claim a dividend from any kind of investment portfolio.

 

Essentially my trading profits (from the partnership, which are not more that £50,000) are not equal to my non-trading income (dividends from the LTD company)

 

To conclude, it feels as if I (and many others) have been excluded from the financial assistance on offer due to a technicality (with regards to the dividends aspect) to which all I seek is parity with others who are able to gain financial support in these difficult times.

 

I also respectfully ask that the Government should enact recommendations (from the recently issued report by the Treasury Committee) to fulfil its promise of “doing whatever it takes” to protect people and businesses from impact of coronavirus

 

June 2020

 


 

Written evidence submitted anonymously

 

My interest in writing this is that my son is in the construction industry has worked for one company for several years and has always, until this year, submitted his tax returns successfully. This year it has gone awry and despite paying his taxes he is ineligible for the grant so has borrowed to survive. I believe there is a case for an extension for tax returns specifically for CIS workers in order to get SEISS or if not then for previous tax returns to be used.

 

1.       An employee of a company can get furloughed but a CIS worker, working for the same company, has to do a tax return before they can receive any support, even though the CIS worker pays tax throughout the year, every week, just like an employee does. The CIS worker pays a standard rate of 20% which doesn't take into account the tax free allowance, so they actually overpay. On the CIS scheme you must do a tax return in order to get a rebate on the tax you have overpaid, not because you owe taxes.

 

2.       The benefits of employment are many. Sick pay, holiday pay, pension benefits, the security of regular work and no requirement to do accountancy. A CIS worker has no such benefits.

 

3.       If a CIS worker has missed the deadline for the tax return in April, through illness or for any other reason they abruptly become ineligible for support. If a CIS worker has made a mistake on there are tax return, again they are ineligible for support. If they have since done their tax return and submitted it, they are still ineligible for support. If the SEISS scheme is extended but their tax return was incomplete by the April deadline, they are still ineligible for support. In short they have paid their taxes but they are in eligible because they have made an error. That's a pretty hard punishment.

 

4.       I think another period of extension for tax returns would enable many CIS workers who have fallen through the net to be able to claim support.

 

5.       There also seems to be a rule that doesn't allow previous tax returns to be taken into account. Whether this applies solely to CIS workers I don't know but it would make sense that previous tax returns should be used as proof of tax payment. Not that proof should actually be needed because the because the CIS worker has already paid their tax, as that is the nature of the CIS scheme. If CIS tax returns cannot be resubmitted or given an extension then could not previous tax returns at least be taken into account?

 

6.       Employees are well looked after. Those on benefits are well looked after. Some people in the construction industry are in trouble.

 

7.       In regards to communication, some were unaware they could have applied for universal credit in the intervening period. Those people borrowed in order to survive until the grant was paid, and now find themselves ineligible and in debt.

 

June 2020

 


 

Written evidence submitted anonymously

 

On 16/08/2015 I started working for a company as their marketing executive on a salary of £25,000 per annum paying tax by PAYE.

 

On 14/04/2016 I was promoted to Marketing Manager and my Salary was Increased to £35,000 per annum paying tax by PAYE.

 

On 30/06/2017 I received a performance related Salary increase to £42,500 per annum a performance related bonus of £5,000 I continued to pay tax through PAYE on my basic salary and my bonus was taxed through PAYE also.

 

My basic salary remained at this level throughout 2017/2018 but across 2018 it started to become clear to me that the company was not doing as well as previously, new hires had ceased, cutbacks were being made and business levels were dropping.

 

At this point I was concerned for my future at the company so when an opportunity arose in early March 2019 to take on some freelance work outside my contracted working hours, I took it.

 

On 04/04/2019 I set up a home office from which to complete this freelance work and to ensure I was following the correct procedures, I registered as self-employed with HMRC through an accountancy firm and started keeping financial accounts of the freelance work I was undertaking in addition to working for my employer.

 

Any/all fees raised for self-employed work were raised after 04/04/2019.

 

As 2019 progressed it became clear that my employer’s business levels were continuing to drop and cut-backs were even more evident.

 

I continued to do my job for my employer throughout 2019 at £42,500 per annum paying tax on that job through PAYE and recording my additional self-employed income as advised by my accountant.

 

On 05/10/2019 I was told by my employer that I was at risk of redundancy due to falling business levels and on 15/12/2019 my contract was terminated and I received by final salary payment at a rate of £42,500 per annum with tax paid through PAYE plus a redundancy payment of one month’s salary.

 

Once Christmas 2019 passed I threw myself into my self-employed business operations and this became my sole source of income. In January 2020 I secured a number of additional clients and throughout Q1 of 2020 I was making enough money monthly to have a similar level of Net income to that I enjoyed in throughout 2018 and 2019.

 

Add to this that I was now the owner of my own company which resulted in a significantly better quality of life for me and my family at the start of March 2020 the outlook for the coming year looked positive.

 

As March 2020 proceeded this all changed due to Covid-19.

 

-          Retainer work dried up as businesses went into lockdown.

-          New business became non-existent.

-          Payments due for work completed in Q1 slowed and then abruptly stopped coming in at all.

 

To date I have been excluded from any/all Covid-19 related support for business after the Chancellor stated that ‘nobody would be left behind’.

 

I am a taxpayer who not only has evidence of paying PAYE from 16/08/2015 to 15/12/2019 (4+ years) but also one who will be required to pay tax via self-assessment on my self-employed earnings since 04/04/2019.

 

I find it unbelievable therefore that I have been discriminated against and excluded from financial support by HM Govt that other taxpayers are receiving.

 

I have paid more tax than many who are receiving a range of grants and this is grossly unfair.

 

I am a UK resident, a UK small business owner and UK taxpayer therefore I should be afforded the same support as others and cannot understand why I have been excluded and also why HM Govt refuse to adapt present schemes to include me and c.650,000 other individuals who transitioned to self-employment in 2019/2020.

 

Deferral of Self-Assessment nor Universal Credit are adequate support measures for me and these c.650,000 other 2019/2020 ‘new starts’ to self-employment and the proposal by HM Govt that the present measures ‘leave nobody behind’ is simply untrue.

 

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a self employed dance teacher who works term time. I am also employed part time.

 

During the Pandemic I have not be able to teach dancing and I am still unable to do this. As my employed work is more than my self employed income I have had no government support whatsoever.

 

However, my self employed income is my main income during the time we have been in lockdown (term time) which I am unable to now get back. Therefore, the government have not taken into account self employed who only work term time and those that have different work arrangements.

 

My income has been greatly reduced and at the moment I do not have a business and will struggle to get it back up and running again without any support. I do not want to take a loan and get into debt I just wanted to be treated fairly and equally like those that have been helped.

 

June 2020

 


 

Written evidence submitted anonymously

 

I am the sole owner/director of a one-person Limited Company offering graphic design services.

 

The company was registered over 9 years ago (I previously had been employed) and I have been able to support myself as well as always paying my VAT returns, Corporation and personal tax throughout this time. I have never in my life claimed unemployment benefits or any other government support.

 

My clients are based in the Event and Exhibition industry, so for obvious reasons with major events being canceled from February this year work started drying up and has now been reduced to practically zero.

 

It’s certainly not been enough to pay the bills so I’m now relying on savings which are not going to last much longer.

 

I have not been able to get any government support as I’m a Limited Company director on annual PAYE working from home, so I don’t qualify for any grants and can’t furlough myself either.

 

The only support I have been able to access was the BBL which, whilst helpful means future debt and will most likely be used for paying VAT and taxes when I can’t delay those payments any further.

 

I probably had one of my most successful years last year with a turnover of over £80,000.

This year was looking to be similarly positive on a economic level until the pandemic happened.

 

Originally I was quite calm about it all as the government announced that no one would be left behind. As time moved on it unfortunately became clearer and clearer that I, like many others, were indeed forgotten.

 

The Events and Exhibitions industry will be one of the last industries able to re-open, and with the future of the economy and the development of the pandemic being so uncertain I am not sure how long my company and I can last. I can only assume I’ll eventually end up being one of the millions of unemployed.

 

 

June 2020

 


 

 

Written evidence submitted anonymously

 

I am a sole trader self employed bricklayer with net profit in excess of £50k and my reason for wanting to submit evidence is to highlight the gap in coverage in the current self-employment support scheme. When Mr. Sunak announced the scheme he said and I quote “To you, I say this: You have not been forgotten. We will not let you behind. We are all in this together. And we’re covering the same amount of income for a self-employed person as we are for furloughed employees, who also receive a grant worth 80%. The scheme I have announced today is fair.”. To Mr. Sunak and the current government I would like to ask how this is fair to people in my bracket who have a net profit in excess of £50K, this scheme is not comparable to the employed scheme the main disparity being that there is no cap to the employed earnings? As a self employed individual I pay higher rate tax so therefore contribute considerably to the very system that is passing me over. Whilst I appreciate that the self-employed system is very complex working in the construction industry my earnings are covered by the CIS scheme so I am taxed at source and a disruption to my earnings can be clearly seen in line with my collected contributions, I was significantly impacted and had five weeks with no income which being the main provider for a family of five put considerable strain on our finances. To return to work and here of others who have maybe only lost a day or two’s time yet are still entitled to the grant seems unjust and then when I have friends and family whom are employed and earn significantly more than me and still received the furlough payment I fell that I am being discriminated against for being a higher earning self employed individual. Whilst I appreciate that no system is perfect, I feel this glaring disparity between the support offered to the higher earning self- employed individual in comparison to the higher earning employed individual is blatant discrimination. I am also concerned that in the future, in order to recompensate the payments made during the pandemic, taxes will increase at some point and I will be required to bare the brunt of this even though I was passed over and unsupported in comparison to others.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a self-employed, disabled, freelance writer.

I set up my business in September 2018 through the New Enterprise Allowance on Universal Credit. I submitted my tax return on time, but as I only started halfway through the tax year, my profits were small at around £4,000.

I had a PAYE job April – June 2018. This job paid me £2.89 more than I profited as a freelancer in that tax year. As such, I was not eligible for the SEISS. Many in my position, who started part-way through the 2018/19 tax year, are in a similar way – they’ve been trading as self-employed for 18 months plus, but have not received any help.

In the 2019/20 tax year, I have been profitable. However, most of my clients are in financial markets and mortgages, so in March 2020 I lost 97% of income immediately. Had the opportunity arisen for those with a 2019/20 tax return to qualify for the SEISS, I would have benefited from some vital income.

The fact the second SEISS grant is for those affected after 14th July 2020, but excludes those with a 2019/20 tax return, is appalling. I understood the limitations for the first grant, being backdated to the previous tax year (March 2020). However, the second grant is in the new tax year: I have a submitted tax return that proves I have been an earning member of society but have been excluded from the help. Those who cry ‘but fraud!’ also do not understand that, to have a 2019/20 return, anyone needed to be registered with HMRC by October 2019 – long before the pandemic hit. I was registered with HMRC in September 2018 – but the ‘but fraud!’ argument prevents me from accessing help.

All because of £2.89.

I also needn’t point out that, being disabled, lockdown was much harder for me (living on my own) than able-bodied people, too. The financial impact of increased deliveries, for example, further damaged my finances. I’ve not been able to employ my cleaner to attend, my mental health has deteriorated, and the financial stress caused serious distress and many sleepless nights. My health conditions have worsened during lockdown as a direct result of the unfairness of the self-employed financial support offered by the Government.

I’d also like to point out the discrepancies between the SEISS grants and furlough schemes. The Government continues to pay NI and pension contributions, but the self-employed are expected to pay for theirs. The first grant also covers March – July 2020, not the three months of March – May inclusive as advertised. The second grant not being open until August, and dated from 14th July 2020, means the ‘average profits’ of the grant for monthly pay has been underestimated for every. Single. Applicant. The six week discrepancy, for the entirety of June and first fortnight of July, means freelancers have had even less reserves to work from compared to those on 80% furlough.

Secondly, the second SEISS grant applies to 14th July 2020, but those on furlough schemes won’t see a reduction in their income at all. In addition, businesses won’t have to contribute until September – again, putting the self-employed cuts well ahead of those faced by businesses. We’re told the reduction to 70% average profits is to bring us into line with the furlough scheme, but dating the second grant from 14th July means this is simply not true.

June 2020

 


 

Written evidence submitted anonymously

 

I became self employed on 16th October 2018 and have remained self employed since. I have paid self employed taxes for the 18/19 tax year but fall just short of the 50% rule for the total year as I was employed elsewhere previous to that date. At no point was I out of work and I paid taxes on both jobs for the full year as well as the  previous 10 years or so. As I freelance at other design agencies as a graphic designer my last day of work was 12th March, since then we had the official lockdown and I was out of work. Further to this my wife was on statutory maternity leave so entering the lockdown period we had an income between the 3 of us of £650 with no government support. I thought I would be due some kind of help from SEISS but that wasn’t to be, even after trying to dispute it. As a taxpayer and someone who has always worked and done everything by the book I am absolutely astounded that I’m not eligible for ANY government support and I can’t stress how badly the government has let me down and it’s something I can neither forget or forgive. I have never had any issues paying my taxes and I enjoy my work but I was always under the impression that by contributing myself over the years that the support others receive would also be available to myself if I was ever to fall under hard times, that quite clearly doesn’t seem to be the case. I have since filed my tax return for 19/20 tax year to show I have continued to work self employed and I’ll be expected to pay a further

£9,121.52 by the end of January 2021, how that will be possible with no support from

the government I’m not too sure. All we ask is that myself and others that have been excluded from the government schemes are treated equally to others and can gain some kind of support, anything! As the majority earner in our small family and having to enter the lockdown period with a 6 month old baby at the time you can not understand the pressure that has been placed on me to do the best I can as a father for my family, I have never felt so worthless and abandoned. Rishi Sunak addressed the nation on March 26th and stated that nobody would be left behind, that no limit was to be set to get us through this, that was quite clearly one huge lie. We have been forgotten about and treated unfairly in comparison to the rest of the nation, we deserve parity and as a tax payer I can’t see why I’m being punished throughout all of this?

 

June 2020

 


 

Written evidence submitted anonymously

 

I am a freelance musician, playing Timpani and Percussion, and have been making a living as a professional orchestral musician and instrumental teacher since 2002. I am currently based in […].

 

I have worked with the UK and Irelands finest orchestras and artists and have been lucky enough to travel the world doing the job that I love. I have also taught many young people to play my instrument to the highest standard. Some have been lucky enough to gain places to study music and become my colleagues.

 

I began teaching for […] in 2005 and have a contract as an Instrumental Music Instructor for them for two days a week. I also teach at […], preparing pupils for music college auditions and onwards.

 

In June 2018 I had my first child. I took maternity leave for a year from my teaching job, but the nature of freelancing being what it is, I returned to performing three months later doing what I could, while recovering from a difficult birth. I found the balance of family and work life worked for us much better during that year and decided to take a two year career break from my teaching position when my maternity leave ended. I was able to take on more performing work over the last year and am now fully self employed.

 

When Covid 19 hit, all of my work was cancelled. The restrictions on gatherings, performances and travelling mean I have no work in the diary for the foreseeable future. Not only was this a devastating blow for me as my job is such a huge part of my life and identity and has been since I began learning music age 4, but financially, it has been devastating.

My teaching, which was PAYE, usually brought in a little over half my income after expenses, until I had my daughter, but as I am now on a career break until June 2021, I have no income from that. The SEISS is only for people who earned more than 50% of their income from self employment up the the tax year ended April 2019, which was just before my maternity leave ended and I became fully self employed, so am ineligible for that as well, even though I have a complete tax year showing that I earn more than 50% from self employment now. The work I had in the diary that was cancelled at the start of lock down was even paid for the next 28 days, completing this tax year, but it isn’t being taken into account.

 

In Scotland the government put in place a scheme to help the recently self employed, those with accounts for 2019-2020, but you can’t have been self employed at any time before this, so I fall through even that safety net. I asked East Dunbartonshire Council if they would take me back and furlough me as I was advised to by HMRC, but they refused. I am ineligible for Universal Credit, I think because my husband earnings are over the maximum allowed, but he doesn’t earn enough to get us to the end of each month without needing help from our families.

 

We have reduced credit card payments, tightened our belts and are burning through what little savings we had that were meant for my daughter.

 

With the recent measures to ease lockdown still not allowing any public performances to take place for the foreseeable future, I don’t know when I will be able to do the job I love, and am damn good at, again.

 

I have never been unemployed before. I have worked from age 16 and all through college to pay my way while I was a student. I have never been on benefits. I have always paid my tax and national insurance. There has been no thought for those of us who have a mixed

 


income or don’t fit neatly into a one size fits all idea of what a job should be. I want to work, but I’m not allowed to and I’ve got no support from the government. I have been left behind.

 

The five step plan recently released by the culture secretary makes no mention of how anything is meant to be funded without income from ticket sales, or a timeline and lacks any real understanding of how my industry is run. Who will fund rehearsals when there isn’t a performance at the end of it to bring in income? Who will pay for performances to be recorded and broadcast or is the BBC meant to commission broadcasts from every orchestra in the UK? Outdoor performances are much more expensive to put on than indoor and the number of people required to attend would make it almost impossible to make a profit for all but the largest events. Do socially distanced indoor performances require the audience to socially distance and not the orchestra? The restrictions put on numbers of wind players allowed to play at the same time means basic repertoire cannot be performed. It would be like asking the premier league to return without the goal keepers and defenders.

The arts bring in £7 for every £1 spent, much more than sport and yet there is no mention of help for my industry.

 

June 2020

 


 

Written evidence submitted anonymously

 

 

My name is […] and I am a musician and am in the orchestra for a musical in a London West End Theatre.

 

I live alone but owing to being self-employed and my profits for the last 3 financial years being over £50,000 I have received no financial support from the government.

I believe this is totally unfair as even within the theatre in which I work, those who are employed directly by the theatre and not as in my case by the musical’s producers, have been furloughed as they are PAYE and as such have been receiving income from the government.

 

I started playing the piano at 6, started doing gigs at 15, finished my degree at the Royal College of Music at 23 in 1997 and have been working fulltime as a musician ever since. I have been a member of the orchestra in the theatre where I work for 12 years. During this time I have also performed with orchestras, jazz bands and vocal groups for concerts, gigs and radio broadcasts.

 

To have worked so hard for so many years in order to be a good enough musician to be employed in the west end but then be financially completely ignored by the government during this crisis is wholly unfair. To be living on savings which I had accrued by living within my means and not financially stretching myself will mean that in the future if I am ever unemployed I will have no safety net.

 

What is the justification for not helping anyone with profits over £50,000? In London in 2020 this is not a massive income by any means. In the last 12 years I have paid around £240,000 in tax and national insurance. Surely I have paid enough into the system by now now to be entitled to get something out of it?

 

Why was the SEISS not set up with same maximum level of benefit as the PAYE one?

A maximum support income of £2,500 per month would be enough to cover most bills and enable myself and the other musicians in my position to spend the time planning for the future rather than worrying about day to day living.

 

I have no idea when theatre can and will reopen and when it does I just hope I have a job to go back to and that I can hold out financially until then.

 

There are so many musicians in my position and a great many far worse. Why doesn’t the government care what happens to us?

Yours in desperation, […]

June 2020

 


 

I am a sole trader and have been working as a self employed Stage Manager for 18 years in the West End of London. I have filed just over £50k trading profit for the few tax years leading up to 2018/19. For this reason I do not qualify for SEISS.

 

My earnings for 2019/20 (not taken into account in the scheme) were under £50k as I was on maternity leave for that financial year. As an aside I do not believe this should be a factor that should penalise women in the SEISS. Majority of my saving were spent supporting this leave.

 

I returned to work at the beginning of March and within 2 weeks the country was in lockdown and my entire work diary cleared completely. Due to working in theatre and live events there is still nothing in that diary and no sign of there being any.

 

My partner is a sole director of […] Ltd; a set up that was required historically for him to trade with his clients. As he pays himself mostly in dividends he has not benefitted from the schemes other than being able to furlough himself on the salary part of his income. A total of £575pcm. The cancelled contracts for my partner’s company alone from 15th March until 18th December 2020 is a minimum worth of £61,714.29. These contracts cannot be produced as part of this evidence due to being covered by a NDA.

 

We are currently trying to access Universal Credit, as our savings are now almost gone, but have been advised that due to my partner’s furlough we are unlikely to get it. We are not eligible for JSA due to not paying Class 1 NI, we pay Class 2 & 4.

 

Regardless of whether we get UC or not, in addition to my partner’s furlough, this in no way is comparable to a PAYE, furloughed couple of a similar earnings bracket who would have received

£5000pcm. We are left with virtually nothing and obliterating our personal savings. Also now relying on family assistance to cover our food bills and nappies for our 1 year old son.

 

We are looking for jobs in a stagnant jobs market and have not been successful in securing anything as yet. We are also now unable to afford childcare which has limited our ability to both access the workplace without restrictions.

 

The cliff edge that is the £50k cap on SEISS has no comparison in the JRS and is a huge lack of parity. I believe this should be removed and funds back paid from the beginning of the scheme to those who should have qualified should this imbalance have not existed. Company directors should also be allowed to have their earnings dividends taken into account as certified by their accountant. Again this should be subject to back payment.

 

Particular attention should be given to those working in the Arts as they have little chance of regaining their pre covid status as things stand. Schemes should be extended for sectors that will not be sufficiently open in October.

 

June 2020

 


 

No income/no financial support at all since April

Cannot work until at least one month after lockdown is lifted completely Minimum monthly outgoings of £2500 per month

Slipping further into debt £2500 every month

 

 

I’m a freelance guitarist currently employed on the […] musical. We stopped working on March 16th. I’ve received my two week notice pay. If the show re-opens we will have to work the two week notice pay that we have received so its effectively a loan rather than wages to cover the lockdown period.

 

Because I have retirement savings in the form of an ISA, I cannot claim UC or the Musician’s Union hardship fund.

 

Because my taxable income after expenses is about £52k I cannot get any government self- employment support.

 

My mortgage is £1600 per month. My essential monthly outgoings about £2500.

 

I have zero income/support and therefore slipping £2500 further into debt every month.

 

Even when social distancing is lifted completely, it’ll be at least a month before the musicians can get back to work. Theatre shows wont be able to open their doors as soon as social distancing is lifted. There will need to be full rehearsal periods of several weeks. Musicians are usually called for the last few days only. So I wont be able to earn anything until about a month/6 weeks after social distancing is lifted completely. After Cameron Mackintosh’s announcement that his shows wont be opening until next Spring, most other shows will follow suit.

 

I’m looking at a year without any income and £30k more debt. Obviously, I have no funds to pay my tax bills in July and January 2021.

I do not understand why employees on PAYE are eligible for support regardless of their income, but the self-employed are capped at £50k.

 

June 2020

 


 

EIC0864

Written evidence submitted anonymously

 

I am giving my own personal evidence of how I have been economically impacted from the coronavirus and the effect of the Government's schemes and access to basic welfare support. I am a self employed costume maker for film and theatre. I have been self employed in this industry for over twenty years but am classed as newly self employed because 3 years prior to 2019 I was mostly employed teaching at an Arts University. I was made redundant from this position in 2018 so the tax year 2019-2020 is my first full year back to being fully self employed. I have submitted my 2019-2020 tax return. Lockdown was enforced on the 23rd of March 2020 that is only 13 days before the end of that full tax year ending April 2020. For this reason I am not eligible for SEISS. As for the other schemes available I am not a large company with staff and I work on site so they are not suitable. I am professional craftsperson skilled in specific work to make items for productions. I am reluctant to apply for a Bounce Back Loan as to me this just another form of debt to be repaid and I have no idea when the film and theatre sector will re open again. I also feel that furloughed workers and self employed people eligible with access to SEISS do not have to endure this further debt, it is simply because I am classed as newly self employed, so why should I?

The company I was working for was incredibly busy before lockdown, it is purely because of the coronavirus lockdown that I have no work presently and I am not able to return to it as all work in Film, TV and Theatre have been halted.

I am not eligible for Universal Credit because I live with my partner who has an income. We are not married and I do not have savings. This will contribute to an imbalance of my relationship as I have always supported myself and happily so. I have lost any financial independence and may I add this may actually be dangerous for some women who do not have a good relationship or other family support.

I have applied for Job Seekers Allowance although I am yet to receive a reply. I may not even be eligible for that as I was made redundant in 2018.

This is my evidence that I am not eligible for any of the Government Schemes nor even access to basic welfare support purely because I was mostly employed in 2018-2019 and made redundant. It seems strange to me that with all of our tax and employment history held by HMRC that some form of support can not be now revisited especially as I have submitted my 2019-2020 tax return and lockdown was only 13days before that tax end. All UK tax payers should be treated equally with support no matter how complicated it is, especially now the height of the crisis is all being well in decline.

It has been very traumatizing for everyone in this country dealing with a pandemic, watching people fall ill and pass away, worrying about the health of loved ones and of course your own health and well being. For those of us that have been blocked at every turn trying to receive even basic financial help it is an even worse experience. It has caused me an immediate loss of my job, stress, anxiety, depression, loss of independence, insomnia and a real fear of the future.

I am also experiencing immense frustration listening to Ministers saying there is access to some form of support when for me however, my only support would seem to be ‘debt'.

I would also like it to be noted that I am a single women of middle age who I fear after the statistics are calculated will be of a higher proportion. This could be a sex discrimination issue.

June 2020

 


 

Written evidence submitted anonymously

 

Introduction:

I have been marked ineligible for SEISS grant due to the way I was paid for self-employed work through a PAYE (RTI) system. 100% of my work is self-employment. I also do not qualify for Universal Credit. My answers mostly pertain to that situation. I have fallen through the gaps due to the nature of the eligibility criteria and not due to the nature of my working life. I am asking the committee to consider my evidence in detail as it is nuanced. The systems of support set up by the government don’t make enough provision for the realities of self- employed people’s working lives, which are also nuanced. There is a feeling that the government are holding their hands up and saying.. “listen, we did all we could at the time, it’s not perfect, but we just need to move on now.” However, as you will understand, from my evidence below, that could leave a great number of UK tax-payers behind and in unfair and desperate financial futures. Furthermore, not supporting people like me now will inevitably lead to us relying on the state in the future when we are in unemployment and all our savings have dried up.

 

Job Protection Scheme and Self-employment Income Support Scheme

 

What problems (if any) are individuals facing in claiming support from the Job Protection Scheme and the Self-employment Income Support Scheme?

Self-Employed individuals like myself that do not qualify for SEISS, but who can prove that all of their income comes from Self-employment have no recourse to change their situation and benefit from the financial support that the rest of the country has. HMRC’s review process does not take certain nuances around eligibility into account. For instance, I do not qualify for SEISS because my tax return says that over 50% of my income is from PAYE employment, however that is due to the way in which I was paid rather than the type of work I did. In effect, with my major employer over the past 3 years, my self-employment contract went through that company’s PAYE system. I paid no tax at source and received full gross wage, but in the eyes of HMRC I was paid through Real Time Information, and therefore this process, which I had no control over or say in, has disqualified me for support during this pandemic crisis.

I also do not qualify for Universal Credit due to our savings (my wife’s and mine) being over

£16,000. I am therefore living off my savings from this point on with no recourse for changing this situation. As a self-employed low-income earner, my savings have been extremely hard to accumulate over the past 12 years of my working life, and were put in place over these years to put together towards a deposit on a property and expenses for plans to have a child. Those fortunate enough to qualify for SEISS or furloughing are able to keep their savings intact by contrast.

 

How effective have these schemes been in maintaining employment and reducing job losses?

From my point of view, they have not been effective at all.

 

Is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that fraudulent claims are detected?

 


They have struck the balance on this issue completely in the wrong direction from my experience. I have an appropriate claim to an SEISS grant, however it is precisely due to the government’s anti-fraud measures I am unable to claim the support I should be entitled to. As an anti-fraud measure, the HRMC are not accepting evidence from amended tax returns towards claiming the SEISS grant. I have a legitimate reason to amend my tax returns over the past 3 years. I was paid through the Real Time Information system and my accountant therefore filed this income as Employment Income. I now know that it should have been filed as Self-Employment Income, as no tax was taken at source and I was paid gross, in the understanding that I would pay tax based on my tax return. I, and other people in my situation, are aware that if I make an amended tax return I will be liable for increased NIC payments. However, even with those payments it is still in my interest to file an amended tax return if I were to then get the SEISS grant. I would take the option to pay this large NIC bill in order to qualify for the SEISS grant, but that is not even an option for me, as, even if I did pay this, I would not qualify for the grant due to the anti-fraud measures written into rules of the grant.

With regard to the HMRC not accepted amended tax returns to qualify for the SEISS grant, the number of people who might have defrauded this system without this measure would have been miniscule compared to the number of people it excluded from getting support.

 

For further evidence, my tax advisor’s calculations told me that I would be liable for an NIC bill of £1500.00 – the which is no small sum in the current crisis and equivalent to a month and half of my living expenses – and I would have happily paid it because the support I would get in return would be so useful to me.

 

 

Has the Government struck the right balance between targeting support and making it easy to access?

For others who have been lucky enough to qualify for the grant, it seems to have been straight-forward and accessible. From my point of view however, the lack of accessibility to information or a more thorough and nuanced review process, has led me to spend hours upon hours of admin time researching information, contacting tax advisors at Equity Actors Union, contacting my own accountant, studying previous tax returns, not to mention the stress and anxiety it has brought into my live and the effect on my mental health of falling through the gaps of the support system that has been put into place for the rest of the population. While I was doing all that, others who do qualify for support have had the time and energy to spend in securing other job opportunities, researching how to combat the change in landscape of the industry in crisis. I am severely behind compared to my peers and colleagues in my industry as I have had to spend the majority of my work time trying to figure out ways to get support. The committee can’t underestimate the toil and the toll of trying to claw one’s way out of the hole when you’ve fallen through the gaps and into it.

 

 

How successful has the Government been in plugging the gaps in the schemes?

If you read my pervious answers you will have my account of, in my experience, how unsuccessful the government has been at plugging the gaps for self-employed people.

 


What gaps in coverage still remain and are changes required to increase their effectiveness?

The major gaps remain in the eligibility criteria for the SEISS grant. The 50% trading profits from self-employment rule in my case is unfairly punishing. Fundamentally however, outside of my case, this rule fails to understand the reality of the working lives of self- employed people, especially actors and those involved in creative industries. These are low- paid and infrequently paid industries and the people involved in them often have to supplement their self-employed income from other “gig” jobs. If they were unlucky enough to be working as self-employed and not in a PAYE gig job at the time of lockdown, they have no chance of being furloughed and due to their way income might be weighted towards PAYE payment they cannot get SEISS grant either.

So yes, please, make changes to the requirements for SEISS and allow those who have legitimate claims to make amended tax returns, or open up case-by-case reviews for claims that take into account all the things I have mention in my evidence. It would take more efforts on the HRMC’s part, but it’s nothing compared to the damage it is doing long-term to people like me, and my employment prospects and my future dependence on the state for once my savings run out, not to mention the affect of COvid-19 on the creative and cultural industry as a whole and the reduced employment opportunity therein in the future.

 

How viable is it for the Job Protection Scheme and the Self-employment Income Support Scheme to be open for longer?

The industry needs it to stay open and working until Spring 2021 at least because that is the time theatres are planning their re-opening and recovery process, which includes the possible re-starting employment opportunities for people like me. It is also the tie by which audiences might start to return to the theatre. Please consult with the Federation of Scottish Theatre for more evidence to support this.

 

How and when should the Government’s support packages be wound up?

Spring 2021 by the way things are going at present. However, I thin Covid-19 has shed a light on how important the implementation of a Universal Basic Income would be to society as a whole. If it had been implemented previously for example, the government would have had to pay out less in Covid crisis payments at the time of the outbreak, and indeed, if it happens again there will provision for every resident of the UK to not fall through the gaps.

 

How should the Government prioritise which continuing sectors and groups to support as time goes on and ongoing support is needed?

The government will best find this information out from organisations such as the Federation for Scottish Theatre who advocate for the industry as a whole in Scotland.

 

Other government intervention

Should the Government intervene more actively in terms of state aid, bail-outs and its industrial strategy?

The government should be prepared to bail-out the theatre industry. The greatest evidence for this is that theatre audience comprise of millions of people a year and are an integral part of society and cultural life. Remember how everyone turned to culture (Tv, music, film, theatre online) during the crisis. It provides incredible respite and a means to function as a society in the event that the day to day running of the country shuts down.

 


 

Economy, public finances and monetary policy

What will be the impact on inequalities within society and how should the Government address inequalities that may have been exacerbated by the crisis?

Disabled people need to be listened to at this crisis time of rebuilding. In fact listen most careful to those who are most impacted by inequality disabled people, People of Colour, women, and you will find the best recourse for address inequalities.

 

June 2020

 


 

Written evidence submitted anonymously

 

I work as a self-employed taxi driver. I have been self-employed for over a year and a half. Prior to that I was employed in a PAYE job for 9 months of the 2018-2019 tax year used for the calculations for the SEISS. Due to this I was deemed as ineligible for any income support throughout the corona virus pandemic.

 

I contacted the HMRC and asked whether I could submit my tax return for 2019-2020 and they could calculate the support required from those figures, as it was a fully self-employed tax year work within the same job role that I currently work in. In this conversation I was told that “it would take too much time” for them to do this.

 

As a taxi driver, I am highly at risk due to the multiple contacts and close proximity I have throughout my working day, not to mention that during lockdown the work available was non-existent.

 

During this nation-wide lockdown, I was forced not to work by the government. I was forced through their lack of support for me to deplete all of my savings in order to survive. While many other self-employed people that I know, in work roles such as painters, builders, pest control, etc received government support and were able to continue to work.

 

I struggle to see how it is fair that some many with the ability to continue working or working from home while receiving an 80% portion of their monthly salaries, not only receive one lump sum pay out and will receive a second. While 3 million, 10% of the work force of this country have received nothing. Surely sharing a portion of the monies allocated towards the second payment would could be used to help those forgotten and have received nothing!

 

The government’s current response is that they have provided other options for those in the same situation as me. These options include Universal Credit – which I am not eligible for because my wife receives disability support. A bounce back loan – which again I was not eligible for because I am not a business. Any other loan – would put me in debt for a future that is uncertain and if I cannot pay this back, I would find myself in financial trouble further into the future.

 

I feel that this government have supported many who have still been able to continue working throughout this pandemic and have neglected the most vulnerable of the work force of this country. 3 million people cannot just be overlooked, ignored and forgotten. All we have asked for is help from our government put in place to protect us.

 

June 2020

 


 

EIC0875

 

 

Written evidence submitted anonymously

 

I've been a self employed maths tutor for 5 years. In 16-17 I made a huge loss due to the start up of a different business that folded two years ago (and wasn't on last years SA) and yet the figures from that old business have been used to say I'm not eligible for SEISS as my average profit is negative. It is unfair that you can't claim for a business you no longer have but you can be penalised for it! I'm also baffled as to why, as a self-employed person, the Government are taking an average of my earnings starting four years ago, when employed people who have been furloughed have been given 80% their current salaries.

 

 

Being self-employed, like many, I'm driven to grow my business each year. So even for those that were eligible, they've still lost out on what they would have expected to earn this year. The scheme just does not seem comparable to others for PAYE staff.

 

 

Furthermore, the administration of the whole scheme is questionable given the two letters I've received quoting completely different figures (see images below [redacted]).

 

 

I'm down about £200 a week since the Government cancelled exams and most of my tutoring had to stop. I appreciate that's not very much money compared to what some have lost but it is to us and this whole system has just proven to be unfair. Every time I hear 'not eligible' it just makes me feel like a second class citizen, especially when there are some who have had £2.5k a month off the Government to do nothing for the past 3 months. Due to my Husband's income working for the NHS (which is small compared to peers working for private companies) and my second part-time job working for the local Church, I have not been eligible for any support at all. Which contradicts the rhetoric consistently given by the Government that there is something for everyone. That is simply not true for me.

 

 

Even the 'Discretionary Grant Fund' given to local Councils (supposed to be for people like us, who have 'fallen through the cracks') has in fact been designated for business who have already received other support, and so was another “no" for me.

 

 

I may not pay a lot of tax, currently, but I have saved the Government a lot of money by caring for my own children (6 year old twins) and working two jobs around them.

 

 

My contribution to Society is as valuable as the next and the Government need to start recognising that.

 

 

June 2020

 


 

Written evidence submitted anonymously

 

Introduction:

 

I am the owner director of my limited company and the only employee. I am submitting evidence to the inquiry into the economic impact of coronavirus because I am one of the many who has fallen through the cracks of the governments financial support schemes. As such, I have NO work, NO income and have received NO financial support from the government at all during the crisis.

 

Relevant questions addressed in this evidence submission:

 

Support to businesses and financial services:

 

CJRS and SEISS:

 

Detailed evidence – ineligibility for the government support schemes:

 

 

Despite submitting a nil EPS submission every other month of the tax year, again in line with HMRC guidance, and despite there being clear records of similar salary amounts taken every year for several years, I am totally ineligible for the entire furlough scheme.

 

£575 per month – and I wouldn’t be able to work at all to ensure the future of my business during this time.

 

 

 

 

 


 

 

Whilst my entire working landscape has changed, along with everyone else in the UK, none of the schemes have been designed for the many small limited company directors in my situation – and particularly those who pay themselves salary annually. In fact, it appears that the schemes have been designed to exclude us. It is disgraceful that this should be allowed to happen, and that as a result I have been given no support whatsoever.

 

I am now living on my savings and wondering when I will work again, whilst others – in particular the self-employed – freely get the support that they need with two non-repayable grants and the freedom to continue to work. This situation of clear non-parity needs to be addressed as a matter of urgency.

 

I would love to continue to work and help the economy get back on its feet – and I would like to be treated fairly by the government. Having worked hard for many years, paid all my taxes, contributed to the economy and taken on considerable risk by setting up my own business, I now feel extremely let down by the government – and very much excluded from the help that others are getting freely.

 

June 2020

 


 

Written evidence submitted anonymously

 

The long term solution to Economic Inequality in the UK is clear…..Education…it will take time and there is no time like the present to start the revolution.

 

The Coronavirus Programme this afternoon featured both Justine Greening and a Sky reporter ( I did not catch his name) on this subject.

 

The Army can build Hospitals with remarkable speed…why not get them to build Schools?

 

Make Teaching a respected Profession as it is in many other Countries…..on a par with Lawyers, Doctors and Accountants etc.

 

There must be loads of people out there who have recently lost their jobs who would love to put something back into our great Country….they could a lot worse than becoming Teachers!!

 

June 2020