Apr 09, 2020

With Government support encouraging and helping many businesses over the next three months, we hope that many employers will be able to maintain their contractor workforce for the foreseeable future.

However, none of us know what the future might hold, so here are some tips to help you manage your personal finances during these difficult times. Here are some tips which will help you manage your personal finances.

Grants for self-employed people

  • If you are self-employed or use the Construction Industry Scheme, and you have average profits of £50k or less, then you can also apply for a grant equal to 80% of average self-employed profits up to a maximum of £2,500 per month.
  • To be eligible, you must have submitted a 2018/19 tax return (or do so before April 23rd 2020).
  • The grant you are entitled to will be determined by your average monthly earnings based on your last three years’ tax returns, or less if you have not been trading for three years to April 2019.
  • If you have been trading since April 2019, there is no explicit support for you outside the welfare system but you may be able to receive a grant if you can prove your earnings. HMRC will contact you in the coming months to tell you if you qualify and how much might be available in your circumstances.

Alongside these measures, a number of other initiatives have been announced by the Government to help ease concerns about money. Find out more here.

What else can you do?

  • Get a clear picture of what your financial status is now. What have you got coming in, going out and is there a discrepancy?
  • Check with your bank to see what help they have on offer. Many have initiatives which help you manage your finances. For example, Barclays run a Money Mentors scheme to enable people to access tailored advice and support – you don’t have to be a Barclays customer to access it.
  • Review any outstanding loans such as car repayments. If you’re worried you may miss payments, speak to your lenders as soon as possible.
  • The Government instructed banks to provide mortgage holidays for customers affected by Coronavirus. Most high street lenders have schemes in place to enable you to defer payments, some for up to three months, and you may be able to find a better interest rate.
  • In addition, the Government has instigated added protection for if you rent your home, with an extended ‘buffer period’ in place until 30th September which means your landlord must give you 3 months’ notice if they want to end the tenancy.
  • Some councils are offering council tax holidays and deferred payments for those who are struggling to pay, though there is no standard approach among local authorities so check what’s allowed in your area.
  • Review your pension contributions, savings and any other investments to check whether they are affordable at the moment. See if you now have any obsolete insurance policies. You will need to take independent financial advice, but you may be able to temporarily cease or reduce contributions to ease the strain on your personal finances in forthcoming weeks, if necessary.

How can we help?
Whilst we cannot provide advice relating to your personal finances and investments, we can help with questions about being a self-employed contractor or Umbrella employee. Please do get in touch.

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