Self Employed Income Support Scheme - REJECTED

[Vending Siting Services]

I have just been informed, as a self employed individual, I do not qualify for the self employed income support scheme. My accountant and I are totally baffled after having my claim rejected this morning. I have run my current business for 8 years, I have paid PAYE every month and I have one member of staff who has been furloughed.

The term 'trading profits' does not account for the wages that I pay myself each month which is money I live on. My business makes a small annual profit which is in the £100's.

This scheme does not seem fair at all - my member of staff is being paid via the furlough scheme which is wonderful and I am being penalised as I don't have so called 'trading profits'. I know I am not alone here as my accountant has received many rejected claims from a lot of their self employed clients.

I thought this scheme was to equal that being offered to furloughed members of staff? Of the self employed people that I come into contact with or know, they are all exactly the same as me, ie what they are able to earn is reliant on business being conducted and that's it.

It looks like the Government have TRULY TRULY allowed the self employed to fall through and their scheme certainly is not the same as that offered to staff.

Barbara Fellowes

 

[Hunnie]

I don't think the scheme is for those with PAYE
Can you furlough yourself?

 

[Newchodge]

If you are self employed you do not dedcut your 'wages' from your profits. Your accountant should know that.

 

[Vending Siting Services]

I don't think the scheme is for those with PAYE
Can you furlough yourself?

Hello Hunnie, many thanks for your reply.

My initial understanding is that a self employed individual were not able to Furlough themselves? I have spoken to my accountant and that is what we are going to try and see what happens. The information about self employed individuals was to wait and no other instructions from what I can gather were advised otherwise.

 

[bovine]

I think the employee was paye. How are you paying yourself? I would expect what you pay yourself to be part of trading profits for self employed. Unless it’s a director of a small limited co. which is or isn’t classed as self employed depending on which gov department you deal with.

The self employed package is actually better (in my opinion) than the furlough scheme. The support for paye/dividend directors is the worst.

edited to add: better for the person who can still work, but has had some loss of business as they can actually get more than they usually get.

 

[Newchodge]

Hello Hunnie, many thanks for your reply.

My initial understanding is that a self employed individual were not able to Furlough themselves? I have spoken to my accountant and that is what we are going to try and see what happens. The information about self employed individuals was to wait and no other instructions from what I can gather were advised otherwise.

If you are self employed (that is, not working through a limited company) you do not receive wages. All the profit that the business earns is yours and the fact you take some money for living expenses is completely irrelevant. The self employed business profit is turnover less allowable expenses.

You can only get furlough pay from the government if you have been paid through PAYE. You cannot, when self employed, pay yourself through PAYE.

I would check your accountant's qualifications.

 

[Vending Siting Services]

I think the employee was paye. How are you paying yourself? I would expect what you pay yourself to be part of trading profits for self employed. Unless it’s a director of a small limited co. which is or isn’t classed as self employed depending on which gov department you deal with.

The self employed package is actually better (in my opinion) than the furlough scheme. The support for paye/dividend directors is the worst.

edited to add: better for the person who can still work, but has had some loss of business as they can actually get more than they usually get.

I pay myself monthly and pay the relevant tax and NI each month. Since Covid my business is zero.

 

[Newchodge]

I pay myself monthly and pay the relevant tax and NI each month. Since Covid my business is zero.

Then you must be a limited company?

 

[Mark T Jones]

I pay myself monthly and pay the relevant tax and NI each month. Since Covid my business is zero.

All of which would suggest that you are an employee, not self employed.

 

[Vending Siting Services]

If you are self employed (that is, not working through a limited company) you do not receive wages. All the profit that the business earns is yours and the fact you take some money for living expenses is completely irrelevant. The self employed business profit is turnover less allowable expenses.

You can only get furlough pay from the government if you have been paid through PAYE. You cannot, when self employed, pay yourself through PAYE.

I would check your accountant's qualifications.

Yes that was my understanding too. Now I am completely confused! I pay (paid) my taxes monthly for myself and that of my employee and my accountant issues me with pay slips. When I ran a much larger business which was Ltd and VAT registered, we done our payroll along with all members of staff and deductions were paid monthly to HMRC as I do now - or did until the pandemic hit.

 

[Vending Siting Services]

Then you must be a limited company?

Hello Newchode, no, I am self employed and it's just me and one other member of staff operating way below the VAT threshold.

 

[Newchodge]

Yes that was my understanding too. Now I am completely confused! I pay (paid) my taxes monthly for myself and that of my employee and my accountant issues me with pay slips. When I ran a much larger business which was Ltd and VAT registered, we done our payroll along with all members of staff and deductions were paid monthly to HMRC as I do now - or did until the pandemic hit.

It does not help at the moment, but, if you are NOT working through a limited company, you need a new accountant.

Edit: NOT added

 

[Vending Siting Services]

All of which would suggest that you are an employee, not self employed.

If that is the case then I should qualify for furlough? I don't see how though as I have a Self Assessment Form which is submitted annually.

 

[Vending Siting Services]

It does not help at the moment, but, if you are NOT working through a limited company, you need a new accountant.

Edit: NOT added

Why do I need a new accountant? I choose to pay my taxes monthly and be self employed. I don't actually understand why I need to be a Ltd Company? There are many self employed individuals out there who pay their taxes monthly.

 

[Maxwell83]

Y I pay (paid) my taxes monthly for myself and that of my employee and my accountant issues me with pay slips.

I take this to mean you are paid via PAYE? Or do you mean that you simply pay an estimated sum for tax & NI into your HMRC account each month, to chip away at your annual bill?

 

[Vending Siting Services]

I take this to mean you are paid via PAYE? Or do you mean that you simply pay an estimated sum for tax & NI into your HMRC account each month, to chip away at your annual bill?

Hello Maxwell

I pay HMRC an exact amount as calculated on what I am able to pay myself each month and it is paid monthly. I have just looked at my HMRC payment method and the document is called Employer Payment Record and the Employer name is Vending Siting Services which is my business name. Maybe I should have been furloughed in the beginning? My accountant is going to be submitting a furlough claim next week so I am hoping this will resolve the issue. So confusing ....

 

[ecommerce84]

Are your initials BEF?

If so you are not currently a director of a limited company.

I think the confusion is arising because a few things you mention don’t correlate with being self employed. Pay slips for instance being one, and paying tax and NI monthly to HMRC.

I’ve heard of people putting tax and NI aside in a bank account for payment when needed but not to HMRC. I’ve never heard of a self employed person receiving pay slips.

 

[Anna Chandley]

Are you saying that you operate Vending Site Services as a sole trader but your accountant has processed wages through the payroll for you as though you were an employee?

On your self assessment tax return have you entered the "wages" in the employment pages of the return and the profit remaining after these wages in the self employment pages?

 

[Vending Siting Services]

Are your initials BEF?

If so you are not currently a director of a limited company.

I think the confusion is arising because a few things you mention don’t correlate with being self employed. Pay slips for instance being one, and paying tax and NI monthly to HMRC.

I’ve heard of people putting tax and NI aside in a bank account for payment when needed but not to HMRC. I’ve never heard of a self employed person receiving pay slips.

Hello ecommerce, yes, that's me BEF and thank you for your reply

I have just written to my accountant as I feel something is not right here. I have to profess to not knowing the ins and outs of accountancy and have run my current business in the same way since I started. I truly don't understand what is right or wrong as I never had reason to question until now. When I started this business my accountant asked if I wanted to pay monthly or pay at the end of the year to which I replied monthly to save me having to fork out for a big bill at the end of the year. When my accounts are done it is then that I find out how much additional tax I have to pay or if indeed there is a refund owing. Confused.com I am.

 

[Vending Siting Services]

Are you saying that you operate Vending Site Services as a sole trader but your accountant has processed wages through the payroll for you as though you were an employee?

On your self assessment tax return have you entered the "wages" in the employment pages of the return and the profit remaining after these wages in the self employment pages?

Hello Anna

I don't know. My accountant filled it in for me, I must have checked it before submission but would not have known if the figures were put in the right place. Is this something I should ask her?

 

[Anna Chandley]

Hello Anna

I don't know. My accountant filled it in for me, I must have checked it before submission but would not have known if the figures were put in the right place. Is this something I should ask her?

The questions you need to ask are

1. Am I a sole trader
2. Am I being paid as an employee through the payroll
3. Have RTI submissions been filed with HMRC which include the wages being paid to you
4. Have the "wages" been included in the employment pages of your tax return
5. Is the profit reported in your self employment pages before or after the deduction of your "wages"

If the answers to questions 1 and 2 are both yes then there is a problem.

Anna

 

[Vending Siting Services]

The questions you need to ask are

1. Am I a sole trader
2. Am I being paid as an employee through the payroll
3. Have RTI submissions been filed with HMRC which include the wages being paid to you
4. Have the "wages" been included in the employment pages of your tax return
5. Is the profit reported in your self employment pages before or after the deduction of your "wages"

If the answers to questions 1 and 2 are both yes then there is a problem.

Anna

Hello Anna

Thank you so much for your reply, much appreciated. I shall cut and paste and see what happens. What if I am being paid through Payroll? Will that mean I can be furloughed?

 

[Anna Chandley]

A sole trader cannot employ themselves so if you have been paid via the payroll that is a mistake. If this is the case you are not an employee and cannot claim furlough.

 

[Vending Siting Services]

A sole trader cannot employ themselves so if you have been paid via the payroll that is a mistake. If this is the case you are not an employee and cannot claim furlough.

This is my understanding too - if it's a mistake, in your opinion, can it be changed or is there a way an individual like me will get support or even listened to?

 

[Anna Chandley]

Unfortunately HMRC are ignoring any amendments to tax returns made after the 26 March 2020 when determining if you are eligible for SEISS so correcting the returns now would not help.

Has your accountant got professional indemnity insurance?

 

[Vending Siting Services]

Unfortunately HMRC are ignoring any amendments to tax returns made after the 26 March 2020 when determining if you are eligible for SEISS so correcting the returns now would not help.

Has your accountant got professional indemnity insurance?

Hello Anna

Many thanks for your reply. I am hoping to get this settled one way or another in the coming week. Thank you again for your input, it has been very helpful needed.

Kind regards

Barbara

 

[trax7960]

Hello Anna

Many thanks for your reply. I am hoping to get this settled one way or another in the coming week. Thank you again for your input, it has been very helpful needed.

Kind regards

Barbara

Please do let us know what your ‘accountant’ has to say, because so far nothing about your situation is adding up for any of us.

After they get you onto the right support scheme and this starts to blow over....find a new accountant.

 

[Vending Siting Services]

Please do let us know what your ‘accountant’ has to say, because so far nothing about your situation is adding up for any of us.

After they get you onto the right support scheme and this starts to blow over....find a new accountant.

Yes I will inform you all. I spoke to an advisory business service and explained the issues and they seemed to think that I just go through the furlough scheme as I am on PAYE? Time will tell, the next portal to claim furlough for us is next week so fingers crossed I will get a solution.

 

[trax7960]

Yes I will inform you all. I spoke to an advisory business service and explained the issues and they seemed to think that I just go through the furlough scheme as I am on PAYE? Time will tell, the next portal to claim furlough for us is next week so fingers crossed I will get a solution.

Indeed....but you can’t be on PAYE and Self Employed at the same time; you’re one or the other and you seem to have been told that you’re both

 

[Vending Siting Services]

Indeed....but you can’t be on PAYE and Self Employed at the same time; you’re one or the other and you seem to have been told that you’re both

This has come to be quite a shock for me today to say the least! Me thinks a little boo-boo has happened for sure. The system (I am hoping) will have me down as PAYE so fingers crossed furlough should be accepted, if not, then I will then look deeper.

 

[MBE2017]

110,000 Self Employment Income Support Scheme successful applications today already, totally £340m of grants (so avg grant works out at £3,100 ie £1,033/mth)

So despite what you stated at the beginning of this thread, the scheme appears to be working very well.

 

[Vending Siting Services]

110,000 Self Employment Income Support Scheme successful applications today already, totally £340m of grants (so avg grant works out at £3,100 ie £1,033/mth)

So despite what you stated at the beginning of this thread, the scheme appears to be working very well.

I am sure the scheme is working well, for me it's not and I know I'm not the only one.

 

[Mark T Jones]

This has come to be quite a shock for me today to say the least! Me thinks a little boo-boo has happened for sure. The system (I am hoping) will have me down as PAYE so fingers crossed furlough should be accepted, if not, then I will then look deeper.

From the other side - As a business owner it is your responsibility to understand what the legal status of your business is and what your personal employment status is.

You might well - to a degree - have delegated some responsibility to your chosen accountant - though it remains ultimately your responsibility.

If your acountant has gone against your instructions or has given you eroneous advice, then you should be making a claim against them.

From what has been written here, it certainly isn't HMRC's fault, or any lack of support on the Government's part.

 

[Vending Siting Services]

From the other side - As a business owner it is your responsibility to understand what the legal status of your business is and what your personal employment status is.

You might well - to a degree - have delegated some responsibility to your chosen accountant - though it remains ultimately your responsibility.

If your acountant has gone against your instructions or has given you eroneous advice, then you should be making a claim against them.

From what has been written here, it certainly isn't HMRC's fault, or any lack of support on the Government's part.

Yes Mark, you are absolutely right - but when you are reliant upon and paying for professional services who are supposed to be 'experts' in their fields, I have to say that today's news has been a rather big shock to me. I am guided by the professionals I contract and pay and as such I hope to be given good advice and if it was not for the wonderful help I have got here today on UKBF, I would be none the wiser so thank you to all those who have responded and if my thread can help just one other person who is also in the same position as me then they too can learn from it.

Once again, thank you UKBF members who have responded, it has made it very clear where the errors have arisen and I for one have learnt.

Kind regards

Barbara

 

[JEREMY HAWKE]

I can't understand why you have not picked this up on here from reading what everybody else has.said over the years
I will be frank You accountant is a complete dumb ass and a novice but it is you that suffers
All too often these so called professionals are given the final say on things .when those of us in business all our lives are dismissed as crack pots because we did not sit an exam
Good luck with this I hope you get something

 

[gpietersz]

will be frank You accountant is a complete dumb ass and a novice but it is you that suffers
All too often these so called professionals are given the final say on things0

II agree. I wonder whether the account is a properly qualified and regulated accountant? Unless there is some reasonable explanation of the situation a complaint to their professional body may be appropriate.

 

[Vending Siting Services]

I can't understand why you have not picked this up on here from reading what everybody else has.said over the years
I will be frank You accountant is a complete dumb ass and a novice but it is you that suffers
All too often these so called professionals are given the final say on things .when those of us in business all our lives are dismissed as crack pots because we did not sit an exam
Good luck with this I hope you get something

Thanks Jeremy, I too hope that this can be resolved. I don't claim to be an expert and when asked the question do I want to pay my taxes at the end of the year or monthly, I opted to pay monthly and never thought anything of it and even though this subject may have been covered here before, not all threads get read or feel relevant. When I ran a larger company which was Ltd, we had accountants look after our affairs and you have to rely upon their expertise to guide you and like you, I never sat any exam for business, you just learn as you go and focus primarily on getting in the money. Take care.

 

[Vending Siting Services]

II agree. I wonder whether the account is a properly qualified and regulated accountant? Unless there is some reasonable explanation of the situation a complaint to their professional body may be appropriate.

Hello Gpietersz, yes she is properly qualified and has been doing accountancy for many years and for many clients. I'll get to the bottom of this now that I am aware that there has been a cock up somewhere. Another something to worry about eh!

 

[UKSBD]

When you say you have been paying monthly, are you sure you have actually been paying HMRC and do you submit the Payroll?

Maybe the accountant just puts it in a holding account for you and sorts it at the end of the year

 

[Vending Siting Services]

When you say you have been paying monthly, are you sure you have actually been paying HMRC and do you submit the Payroll?

Maybe the accountant just puts it in a holding account for you and sorts it at the end of the year

My accountant works out Tax and NI and does submissions and I pay directly to HMRC on line. I have spoken to HMRC in the past when I have had the odd query and they do receive my payments. This is a very weird scenario.