CoronavirusLatest News

Accountancy firm issues ‘concerns’ for self-employed workers

An “alarming” number of self-employed workers won’t qualify for government support, according to a recent Shenward Chartered Accountants survey.

The firm’s survey results reportedly challenge the government’s claim that 95% of self-employed workers would be covered by the support packages announced on 26 March.

Almost a third of sole traders who said they were unable to work were identified as ineligible for any of the self-employment grants due to becoming self-employed after April 2019.

Some 30% of director and shareholder respondents were also unable to make a claim for furlough pay through the Coronavirus Job Retention Scheme, as they do not pay themselves a salary through PAYE.

Of the 67% of directors and shareholders who were eligible to claim, just under half paid themselves less than £10,000 per annum through PAYE, despite 25% of these reporting an annual turnover of between £125,000 and £500,000.

Shenward said that the survey results “provide justification for the anger felt by self-employed people across the nation” and that many self-employed workers would “fall through the cracks”.

The accountancy group is now “concerned” that next to no profit for many individuals despite impressive turnovers means individuals will receive hardly anything from the self-employed grant, and experience financial hardship.

The survey, which was carried out in April, also revealed that  73% of respondents had no access to reserve funds or savings, while 63% of respondents were already experiencing financial difficulties, and 33% feared they would shortly.

Sherad Dewedi, managing partner at Shenward, said:  “There’s no denying that the financial measures put in place are outstanding and the government has responded quickly to the needs of the country, but we feared that more people than initially predicted wouldn’t meet the criteria for support and would be left without sufficient income.

“It’s worrying to see the number of individuals who are already experiencing financial difficulties, and it’s alarming that half have a family to feed.” 

He added: “Yes, there is the option to apply for the Business Interruption Loan Scheme, but approval has been slow with only 12,000 loans issued thus far.

“Our main concern surrounding all of this, is the negative effect financial hardship will have on individuals and so we aim to campaign for a review of the support.”

Back to top button

Please disable your ad-blocker to continue

Ads are the primary way in which publishers generate the revenue needed to pay their staff. If we can't serve ads, we can't pay journalists to write the news.