Self Employed Income Support Scheme (SEISS) Update
There have to date been three SEISS grants available to the self-employed, with applications for the third grant closing on 29 January 2021.
It has been known since last September that a fourth grant would be made and the Budget on 3 March 2021 confirmed that. Unlike the first three grants, the fourth grant is not restricted to those who were in self-employment on 5 April 2019.
HMRC will look firstly at the 2019/20 Self-Assessment Tax Return to decide eligibility. Trading profits must be less than £50,000 and at least equal to non-trading income. Failing that, HMRC will then look at the average of profits for 2016/17 to 2019/20.
The amount of the grant is 80% of 3 months average profits, capped at £7,500.
Key criteria are as follows:
- Must have traded in both 2019/20 and 2020/21.
- Must be currently trading but impacted by reduced demand due to Coronavirus, or temporarily unable to trade due to Coronavirus.
- Must declare that you intend to continue to trade, and you believe there will be a ‘significant’ reduction in trading profits due to Coronavirus.
It is to be hoped that there will be some explanation of what ‘significant’ means when further guidance is issued.
HMRC will contact those who they believe are eligible in mid-April, with the online claims service expected to be available from the end of April.
There will be a fifth and final grant for those whose turnover has reduced in the year April 2020 to April 2021, depending on the amount of reduction. For those with a reduction of 30% or more, the grant will be 80% of 3 months average trading profits, capped at £7,500, and for those with a reduction of less than 30%, a grant of 30% of 3 months average trading profits, capped at £2,850. Claims can be made from late July.