Coronavirus: Childminders will be covered under the scheme to support self-employed

Catherine Gaunt
Friday, March 27, 2020

Childminders are among the workers that could be eligible for the Government scheme to extend financial support to the self-employed affected by Covid-19.

Self-employed childminders will be covered by the new scheme  to support those affected by the coronavirus pandemic
Self-employed childminders will be covered by the new scheme to support those affected by the coronavirus pandemic

However, the package of support will not be available until the beginning of June and will exclude those who only became self-employed within the last year.

In the interim childminding businesses will be able to apply for a business interruption loan, which has been extended to the self-employed and universal credit.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

Many childcare settings have closed their businesses this week, while others have stayed open for key workers or vulnerable children. 

Announcing the package of support last night, the Chancellor Rishi Sunak said, ‘Musicians and sound engineers; plumbers and electricians; taxi drivers and driving instructors; hairdressers and childminders and many others, through no fault of their own, risk losing their livelihoods. To you, I say this. You have not been forgotten. We will not leave you behind. We all stand together.’

Liz Bayram, PACEY's chief executive, said that 40,000 self-employed childminders would be ‘breathing a sigh of relief tonight thanks to this major Government commitment to support them and other self-employed people. The fact the Chancellor mentioned childminders in his speech shows he has listened to their concerns.

‘Most of our almost 25,000 childminder members are women on low incomes; some of them are single parents. This support will not only help them survive the next few months, it will also mean they are more likely to stay in business and still be providing much-needed childcare for families once the coronavirus is beaten.

She added, ’We recognise that for newly registered childminders working less than a year this will not be good news but, for most, it will make a huge difference.

PACEY’s hope is, after Coronavirus, that society better values the important support childcare providers including childminders give to children and families every day. This decision by the Chancellor today is a very important recognition of that fact.’

Neil Leitch, chief executive of the Early Years Alliance, also welcomed the vital financial support but added that he was ‘deeply concerned’ about the timing of the plans.

Childminders have mortgages, rents, bills and other expenses to pay right now - how, then, can they be expected to wait until the start of June for any financial support, as the Government has indicated?' he said. 

‘With many already questioning whether or not they are able to stay open to key worker families and vulnerable children during this period, it is vital that they receive wage support as soon as possible. 

With the number of families taking up formal childcare already falling significantly, childminders are already seeing huge drops in income from parent fees. 

‘As such, the Government must outline what interim support it is making available for childminders who are doing as it has asked and providing care for key worker families and vulnerable children during this difficult time - otherwise, it is asking them to choose between continuing to provide a vital service for families in need, and facing financial ruin.’

Are you eligible for the Self-employment Income Support Scheme?

This scheme will allow you to claim a taxable grant worth 80 per cent of your trading profits up to a maximum of £2,500 per month for the next three months. This may be extended if needed.

You can apply if you’re a self-employed individual or a member of a partnership and you:

  • have submitted your Income Tax Self Assessment tax return for the tax year 2018-19
  • traded in the tax year 2019-20
  • are trading when you apply, or would be except for COVID-19
  • intend to continue to trade in the tax year 2020-21
  • have lost trading/partnership trading profits due to COVID-19

Your self-employed trading profits must also be less than £50,000 and more than half of your income must come from self-employment. This is determined by at least one of the following conditions being true:

  • having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
  • having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period

If you started trading between 2016-19, HMRC will only use those years for which you filed a Self-Assessment tax return.

If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19, you must do this by 23 April 2020.

HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way.

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