WFTV reveals grim freelancer landscape
The hardship faced by many during the Covid-19 pandemic is because they are unable to claim under either the Self-Employment Income Support Scheme (SEISS) or the Coronavirus Job Retention Scheme (CJRS).
The WFTV survey uncovered several salient points, including:
- Just 16% of PAYE contractors have been furloughed by their employers or ex-employers under the CJRS
- Only 31% of owners of limited companies have been able to make a claim to furlough themselves under the CJRS. And for those owners who could claim, the majority were only able to claim 20% or less of their income
- And only 32% of freelancers believe they are eligible for support under the SEISS
There were a number of reasons why freelancers reported being unable to claim, such as:
PAYE contractors who had been working for the BBC. These workers say they are being told by the BBC due to the eligibility rules of the CJRS, if they have been working for the public sector arm of the BBC, the BBC isn’t able to furlough them.
Other respondents reported that BBC Studios – the commercial arm of the BBC – had told them that they couldn’t be furloughed unless the BBC had already been planning to re-hire them. *Following recent developments, this BBC policy is now being changed.
Freelancers working for a number of different production companies, who were working in the required timeframe and should have been eligible for furloughing, have been left with nothing, because the companies they were working for didn’t put them on the HMRC payroll in time.
Liz Tucker, chair, WFTV, commented: “Our survey reveals the huge number of freelancers who have been left completely unsupported by the government’s rescue schemes. I appreciate these are very difficult times for many organisations, but I would very strongly urge all organisations, where at all possible to provide the option of furloughing for their staff and help prevent real financial hardship.
“In addition, I would urge the BBC to provide financial support for those who were working in the public arm of the organisation, who are currently ineligible for furloughing.
“It is deeply unfair that these freelancers who have contributed so much, both as taxpayers and in the cultural enriching of our lives, have been left with absolutely nothing. So, we ask that the Chancellor, as a priority, makes amendments to the current financial schemes to ensure as many freelancers as possible are supported”.
WFTV is making the following recommendations for a fairer system:
Remove the cap for freelancers earning £50,000 p/a or more. Currently, someone earning £51,000 p/a is unable to claim anything, whereas someone earning £49,000 p/a can claim the maximum amount.
Allow freelancers working through limited companies to use their combined salary and dividends in any financial grant calculation.
Allow PAYE contractors who are not eligible for furloughing to use their last year’s tax receipts in any financial grant calculation.
Allow freelancers with less than one year’s accounts to use their 19/20 income to calculate any financial grant calculation. WFTV suggests that the government allows freelancers to file their 5 April 2020 tax return by 31 May 2020, and for their 19/20 income to be the one used to calculate the grant payable.
Remove the requirement that the freelancer’s self-employed income needs to be more than 50% of their earnings. If someone has only been freelance for several months, it is very likely that they will have made most of that year’s income from non-freelance earnings.
Where a period of maternity leave has been taken this should be excluded from the three year averaging of accounts for the calculation of grant payable. Currently, anyone who has taken maternity leave will be at a disadvantage. So, we suggest if one of the 3 years used to calculate the financial grant payable has a lower profit due to maternity leave, then that year should be disregarded, and the assessment made only on the two more profitable years.