Millions of tax payers are still being excluded from Government support schemes almost a year on from the beginning of the pandemic
People excluded from Government support schemes say they have been ‘thrown to the wolves’ after going almost a year with no income.
But he stopped short of announcing any new financial packages for the estimated three million people who have not qualified for help throughout the pandemic.
Musicians, freelancers and the self-employed are among those who will see no benefit from today’s attempt to fend off a tsunami of job losses.
Campaigners say it has sparked a mental health crisis with people at risk of losing their homes and struggling to feed their families.
Freelance TV producer Anna Collins, 37, lost a year’s worth of work ‘overnight’ when the first lockdown was announced in March.
She does not qualify for the furlough or Self Employment Income Support scheme (SEISS), despite having always paid taxes and working on some of the biggest shows in television, such as Blue Planet and SAS: Who Dares Wins.
Anna, from Dorset, told Metro.co.uk: ‘I’ve gone from being very proud of my professional and financial achievements, to feeling useless and worthless, and it’s 100% down to not being classed as viable and excluded from financial help by Rishi Sunak.
‘I’ve paid tax my entire working life, and to be thrown to the wolves like this is having devastating financial implications that will take me years to recover from. He is punishing hard working, tax paying people.’
The Chancellor promised in March that ‘no one would be left behind’ – but that mantra was soon replaced with warnings not all jobs could be saved and only ‘viable ones’ could be protected.
People in the arts and live events have been particularly hard-hit by this.
TV producer Anna Collins has not been eligible for Government support since the pandemic began (Picture: Anna Collins)
Anna has only managed to work once since March, with her only other source of income being £400 a month of Universal Credit (UC)– a sum that barely covers her bills.
She had been surviving off her hard earned savings, but they ran out six weeks ago.
Anna said: ‘I am single, I don’t have a partner to support me, my mum is raiding her pension so I don’t lose my home. I know some people are getting through this using bounce back loans but I don’t qualify for that. I have had no work or income [since March], who would lend me money?
‘My universal credit got temporarily reduced to £12 a month, that was because I’d had a very brief stint of work, however, the money I earned from that job went on paying off the debt I’d got into as a result of having no financial support for the previous months, so I was still left with nothing to live on. £3 a week does not go far.’
Anna fell through the cracks because she switched from being contracted on PAYE to supplying her own invoices shortly before the pandemic.
Anna has been unable to work since March due to Covid restrictions (Picture: Anna Collins)
It means she is classed as one of the thousands of ‘newly self-employed’ people who cannot claim SEISS as they do not have a tax return from 2018-19, and historic P60s aren’t accepted.
According to the Government’s own statistics, 1.6 million people are estimated to have been ruled out of SEISS due to not meeting the criteria.
The criteria includes being self-employed prior to April 2019, earning at least 50% of their total income from self-employment and earning trading profits of less than £50,000.
Ministers have resisted calls to revisit this, insisting anyone excluded from the support schemes will have access to the welfare system.
Around three million people are estimated to be excluded from government support (Picture: ExcludedUK.org /Metro.co.uk)
But many have found this is not the case.
Dad-of-two Ian Priestley, a self-employed sales agent who sells shop displays to manufacturers, was denied UC due the amount of money he and his wife had in savings – but the pot is running dry.
‘We had savings for a rainy day, not for a rainy 12 months,’ he told Metro.co.uk
‘We have made cut backs, the kids have gone without, Christmas and birthdays have been reined in.
‘I don’t want to sound bitter, I am a positive person. But some people are being supported over and over.
‘There is a lack of fairness. Those that have profited will continue to do so while those that are excluded will continue to struggle.’
Ian Priestley was denied SEISS but is not eligble for Universal Credit (Picture: Ian Priestley)
The Bank of England’s chief economist said last month that Britons have amassed around £100 billion of excess savings due to Covid restrictions reducing their outgoings.
But while those people are better off than ever, others are on the complete opposite end of the scale.
Market trader Nadeen Khalifeh, 41, was also denied UC due to the amount she held in savings.
Although she was eligible for SEISS she was only given £19 to live off as it was calculated on her first year in business, when trading profits are typically low.
The mum-of-one has spent years putting cash into an ISA so she can buy a new home – a dream that is now a long way off with all her savings being used to cover her rent and bills.
Nadeen, from Blackpool, said: ‘It’s absolutely freezing but I cannot afford to put my heating on. The small amount I have saved is for my rent. I suffer from bipolar disorder. During the first lockdown I was very close to the edge.
‘Lots of people are struggling mentally. Some people are sitting in their cars to warm up as it is cheaper than putting the heating on. How does Rishi Sunak think people can survive with no support?’
Nadeen Khalifeh said her mental leaht is struggling due to the lack of support (Picture: Nadeen Khalifeh)
Faced with no other option, some people have sought Government bounceback loans. While this has helped them stay afloat, it means they have racked up thousands in debt.
Sound engineer Rob Kingsbury, 45, who runs a one man ltd company, says he went from one of his ‘best years ever’ in 2018-2019 to being in debt of roughly £18,000 now.
As a limited company director he pays himself a small salary which he tops up with dividends. Although he can furlough the salary part of his wage, that would only be around a third of his usual monthly income, but there is no official scheme to cover lost dividends.
The dad-of-two, who has shared custody of his children, said: ‘If no more work comes in, I will have to sell my home and rent somewhere so I can still give my daughters a home. I am lucky I had a good year [before the pandemic] or I would have been screwed.
‘The situation now is that my savings have been depleted. I have been living off the bounce back loan. I have never had company debt before. If I was a sole trader I would have been able to claim £2,000 a month in SEISS. I have had to tell my ex I can’t afford our [child] maintenance. It’s either that or I default on my mortgage.
‘It’s like an emotional roller-coaster every time an announcement is made and each time you hope something will be put on the table. I am so angry, it’s getting beyond a joke now.’
Rob Kingsbury is in £18,000 of debt due to being excluded (Picture: Rob Kingsbury)
The treasury and HMRC have said they can’t support limited company directors because it is too difficult to determine those who need help from non-trading companies or shell organisations that own assets.
But tax experts and business bosses have disputed this with both coming forward with workable scheme ideas that limit the risk of fraud.
While millions of self-employed people have been excluded from Government support, they will still face a hefty tax bill this month.
The Government is offering people an extra 12 months to pay this in instalments due to the pandemic, but many say they will still struggle to meet the costs.
Classical violinist Róisín Walters, who set up the petition, said: ‘Until March this year I was busy playing around the country but like everyone last March my work stopped overnight.
Violinist Róisín Walters is calling for tax bills to be waived for the self-employed who were excluded from SEISS (Picture: Leon Farrell)
‘After 10 months of struggling to make ends meet I am now facing a tax bill that I cannot afford to pay. I have started a petition to call on the government to waive this tax bill for people like me who have been without any financial aid since March.’
Róisín said waiving this bill would be the equivalent of less than 20% of most self-employed workers’ annual trading profits, which is far short of the 80% the Government agreed to pay for those who did qualify for SEISS.
‘We would be asking for less than 1/4 of the help given to others. It isn’t enough, but it might be a lifeline for freelancers who have used up any money that may have been set aside in March and now cannot hand over money they do not have,’ she said.
A number of politicians have been lobbying for the Excluded cause, including Greater Manchester Mayor Andy Burnham who today described it as an issue of ‘basic fairness and humanity’.
But in a statement issued to Metro.co.uk, the Government insisted they have given record sums to the self-employed, suggesting a U-turn is not on the cards.
A spokesperson from the Treasury said: ‘Our Self Employment Income Support Scheme (SEISS) is one of the most generous in the world and has helped more than 2.7 million people so far claiming over £13.7 billion.
‘For those who have not been eligible it has often been for reasons like mitigating the risk of fraud or because less than half of their income is earned from self-employment.”
‘Those not eligible for SEISS may still be able to access our loans schemes, tax deferrals, mortgage holidays and business support grants.’
‘We’ve also given five million self-employed taxpayers an extra 12 months to pay their self-assessment tax due in January 2021.’
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