In coronavirus shutdown, Britain will pay self-employed people 80% of average monthly profit

[xeni]

Originally published at: https://boingboing.net/2020/03/26/in-coronavirus-shutdown-brita.html

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[Ceran_Swicegood]

Unless, of course, ‘self-employed’ means ‘airbnb’, in which case, they should get stuffed.

[Professor59]

Wouldn’t it be amazing if the United States did this?

I mean, the US WILL do this, as long as your business was an RNC donor.

[Pensketch]

I’m not a financial wizard, but 80% of profit isn’t the same as 80% of gross, is it? And saying it’s a “taxable grant” tells me that you better save some of that “gift” for taxes.

Still, it sounds better than what our government is doing.

[lava]

Holy shit - that can’t be right because self-employed people are usually the ones that are screwed worse than anybody.

[alanhsy]

So an employed plumber on £55k income gets £2.5k a month paid by the Govt. A self employed plumber on £55k profits gets nothing. Parity?

[byron_p]

@Pensketch

you better save some of that “gift” for taxes

Yeah, taxable grant is almost an oxymoron. Why should the government need to tax something that the government is giving? It makes no sense at all.

[bobtato]

It’s 80% of “profit” before taxable losses, i.e. it’s based on the amount on which you actually paid income tax in previous years.

@byron_p

Why should the government need to tax something that the government is giving? It makes no sense at all.

The fact that it’s taxable means (for self-employed people in the UK) that you will have to pay some of it back in June 2021 and January 2022. But you have more cash in the intervening year.

Personally, if I have no choice but to claim this, I would prefer a “taxable grant” to having the amount reduced upfront. When you’re self-employed, cash flow tends to be more of a danger than not making enough money on paper.

[bobtato]

@Ceran_Swicegood

Unless, of course, ‘self-employed’ means ‘airbnb’

It only covers people who are primarily self-employed, not just anyone who fills out a tax return.^* So “hobbyist” airbnb hosts won’t be getting this.

* ^{outside the US, regular employees don’t fill out a tax return because it’s all done automatically through payroll}

But “professional landlords” certainly will qualify, and obviously they are the kind of people who would claim the max amount whether they’d lost income or not. And I would guess that some of them will also end up getting some kind of relief on their mortgages too.

I haven’t read (or they haven’t published) all the details yet, but it’s not clear whether they will actually check if you have lost money. If they’re just going to take the claimaints’ word for it, then it’s going to be abused most by exactly the people who least need help.

Still, it is limited to people making less than £50,000/year. Also, it won’t cover spivvy “consultants” who pay themselves in dividends to avoid taxes (even though that was supposed to have been banned years ago).

In theory, it should cover anyone who was, say, working in retail on a zero-hour contract, but I’d bet it doesn’t entirely work. A lot of them will have been “employees” of temp agencies for tax purposes, and of course anyone who was getting paid in cash is out of luck.

[the_borderer]

@xeni

Britain’s finance minister Rishi Sunak said Thursday all self-employed citizens will receive a taxable grant of 80% of their average monthly profits as part of the government’s coronavirus response plan.

But disabled people are now even more vulnerable because large parts of the Care act have been suspended.

I honestly believe that de Pfeffel wants us to die.

[gracchus]

Wouldn’t it be amazing if the United States did this?

Yeah, the U.S. hasn’t rolled that way for at least 40 years. The motto should be changed from “E Pluribus Unum” to “F*ck you, buddy, you’re on your own”.

The economies of countries that help their citizens out financially and keep them from spreading the virus by keeping them home from work are going to recover a lot faster.

Denmark’s Idea Could Help the World Avoid a Great Depression

[McGreens]

@alanhsy

So an employed plumber on £55k income gets £2.5k a month paid by the Govt. A self employed plumber on £55k profits gets nothing. Parity?

If you’re earning £55k profit then you can ride this out. There has to be a cut-off at some point and £55k is a lot.

@bobtato

The fact that it’s taxable means (for self-employed people in the UK) that you will have to pay some of it back in June 2021 and January 2022.

Not necessarily. IANAA but you only pay tax on profit (after expenses) over a certain amount, so the lowest earners may not pay tax on it. I think.

Anyway, it’s a good move. The only downside I can see is you can’t get it until June, which right now seems like a very long way away.

[bobtato]

Yes, you only pay tax on income over £11k. If you’ve only been making £11k over the last three years, and you claim the £730/month, then you won’t owe anything on that for tax year 2020/21.

They will only pay 80% of your income if you make less than £37,500, and people who make more than £50,000 aren’t covered at all.

(Which creates a sharp transition for people making £50,001 – I wouldn’t be surprised if that gets refined when they finalise the details, since usually these things are designed to avoid that sort of condition).