Originally written by Timothy Adler on Small Business
Lobbyists, trade associations and experts have joined forces to urge Rishi Sunak to help company directors frozen out of government Covid-19 support.
A consortium of professional bodies has urged the chancellor to consider proposals for a “Directors Income Support Scheme” (DISS), which would mirror the Self-employment Income Support Scheme (SEISS) under which sole traders can claim up to £2,500 per month.
This is a last-ditch attempt for the Treasury to change its mind before this week’s Spending Review.
>See also: When and where to apply for the new 80% self-employed grant
Until now the Treasury has balked at helping self-employed directors of limited companies who pay themselves in dividends, claiming it would be too difficult to separate company income from passive income, such as property and shares.
This is despite company directors paying themselves through through dividends being the standard accounting structure used by around 2m small UK limited companies, ranging from those with sole owner directors to micro businesses, which collectively employ 7.5m people.
Some see the Treasury’s mulishness as a disguised attack by HMRC on self-employed company directors, who often pay less into National Insurance and pay corporation tax instead of income tax.
It is estimated that around