Summary of Government Support produced by Prager Metis LLP – Last updated 19 March 2021
What we know
The Government has announced that the Self-Employment Income Support Scheme (SEISS) will continue until September with a fourth and fifth grant.
The fourth and fifth grants will take into account submitted 2019-20 tax returns.
You may be able to claim, even if you were not eligible for previous grants, however you must have submitted your 2019-20 tax returns by 2 March 2021 to be eligible for the fourth and fifth grants.
Fourth SEISS grant
The Government will pay a taxable grant which is calculated based on 80% of three months’ average trading profits, paid out in a single payment and capped at £7,500 in total.
The value of the grant is based on an average of your trading profits for up to four tax years between 2016 to 2020, where available.
The grant will be available to claim from late April.
In order to claim the fourth SEISS grant, trading profits must be no more than £50,000 and at least equal to non-trading income.
Eligibility for the fourth SEISS grant will also depend on whether you experienced significant financial impact from coronavirus pandemic between February 2021 and April 2021.
As the grant calculation now takes into account the tax year 2019-20, it may be possible that if you previously claimed SEISS grants you may receive grants that are higher or lower in value than any previous SEISS payments you received.
In order to protect the scheme from Fraud, HMRC will carry out further checks. They will write to customers and explain that they will call them to ask for proof of identity and evidence of trade.
To make those calls, they will use the telephone number on the customer’s record.
Where this is our phone number, HMRC will ask that we provide them with your contact number as HMRC will need to speak to you directly.
Further details of the scheme can be found by searching ‘Self Employed Income Support Scheme’ on GOV.UK.
Claiming the fourth SEISS grant
From mid-April, you will be given your personal claim date by HMRC which confirms the earliest date you can claim.
The online claims service for the fourth grant is expected to be live from late April.
You must make your claim for the fourth grant between your personal claim date and 31 May 2021 at the latest.
In association with making the claim you will need to make an honest assessment that there has been a significant reduction in trading profits due to reduced demand or their inability to trade, and you will need to keep appropriate records as evidence.
Fifth SEISS Grant
The Government has also announced that there will be a fifth and final SEISS grant covering May to September.
The amount of the fifth grant will be determined by how much your turnover has been reduced.
The grant will be worth 80% of three months’ average trading profits, capped at £7,500, for those with a higher reduction in turnover (30% or more).
For those with a lower reduction in turnover, of less than 30%, then the grant will be worth 30% of three months average trading profits.
If you are eligible, you will be able to claim the fifth grant from late July.
Further details will be provided on the fifth grant in due course.
Questions and answers on SEISS provided by HMRC:
When will further guidance be available?
HMRC will publish more guidance in due course.
How will customers receive their personal claim date?
HMRC will contact you from mid-April by email, letter or SMS, depending on the information they have on record.
What can customers do to prepare?
HMRC will send details of how to make a claim when they contact customers with their personal claim date.
In the meantime, to confirm eligibility and make a claim, customers should ensure they have the following to hand:
- National Insurance number
- Self Assessment Unique Taxpayer Reference (UTR)
- Government Gateway user ID and password
- bank account number and sort code.
Customers claiming SEISS for the first time may be asked additional questions to prove their identity. These customers should be ready to answer questions about the following documents, which we recommend they have to hand:
- UK passport
- credit file (such as loans, credit cards or mortgages)
- Self Assessment tax return (within the last 3 years)
- driving licence (DVLA UK or DVA NI)
- tax credit claim
- three most recent payslips.
What support is there for those who are not eligible?
Those who are not eligible for SEISS may be eligible for other elements of the financial support provided by the UK Government. This includes Bounce Back Loans, tax deferrals, rental support, increased levels of Universal Credit, mortgage holidays, and other business support grants.
More information on further support can be found by searching on GOV.UK.