22nd July 2021Fifth SEISS: New rules for the self-employed on the way – all you need to know

The Self-Employment Income Support Scheme (SEISS) grant has helped millions of self-employed people across the UK whose business and income has been affected by the pandemic.

Applications for the fourth round of grants ended at the beginning of June 2021 but a fifth round is on its way later this month. If you think your business profit will be impacted by the Covid-19 pandemic between 1 May 2021 and 30 September, you might be able to claim for the fifth SEISS grant.

To help more self-employed people make a successful claim, HMRC has updated its guidance on eligibility. We have outlined this below.

Who is eligible for the grant?

To be eligible for the fifth SEISS you must be a self-employed individual or a member of a partnership.

You must have traded in the tax years:

1. 2019-20, and submitted your tax return on or before 2 March 2021
2. 2020-21

You must also either:

• Be currently trading, but are impacted by reduced demand due to Covid-19
• Have been trading but are temporarily unable to do so due to Covid-19

To work out your eligibility, HMRC will look at your 2019-20 self-assessment tax return. Trading profits must be no more than £50,000 and at least equal to your non-trading income.

Before you claim

You must:

1. Work out your turnover for a 12-month period starting from 1 April 2020 to 6 April 2021.
2. Find your turnover from either 2019 to 2020 or 2018 to 2019 to use as a reference year.

How your turnover affects your grant amount

When you make a claim, the online service will ask for your turnover figures and compare them for you. The claims service will then advise if you can claim the higher or lower grant amount.

If your turnover is down by 30% or more

Your grant will be:

• worked out at 80% of 3 months’ average trading profits
• capped at £7,500

If your turnover is down by less than 30%

Your grant will be:

• worked out at 30% of 3 months’ average trading profits
• capped at £2,850

How to apply for the fifth SEISS grant?

HMRC guidance says you will need the following to make a claim:

• Self-Assessment Unique Taxpayer Reference (UTR)
• National Insurance number
• Government Gateway user ID and password
• UK bank details including account number, sort code, name on the account and address linked to the account
• Only provide bank account details where a Bacs payment can be accepted

You may also need to answer questions about your passport, driving licence or information held on your credit file.

Watch-outs

• The grant is subject to Income Tax and self-employed National Insurance Contributions, and it must be reported on your 2021 to 2022 Self-Assessment tax return
• Claimants must have been impacted by reduced activity, capacity and demand, or have been trading previously and temporarily unable to do so
• You must make the claim yourself. A tax agent or adviser cannot claim on your behalf as this will trigger a fraud alert, which will delay your payment.

With so much information out there it can be difficult, and overwhelming, to keep up with the latest guidance. If you need any support please get in touch, one of the team are here help you through these challenging times.

These details are in accordance with Government guidelines as of 6 July 2021.