Last year the chancellor introduced the self-employment income support scheme (SEISS), which allowed self-employed people whose business and income had been affected by the pandemic to claim money from the Government.
There have been three payments already and in the budget 2021 announcement, more details were shared about the fourth and fifth payments. Here’s what you need to know:
Who can claim SEISS?
You must be a self-employed individual or a member of a partnership. You cannot claim the grant if you trade through a limited company or a trust.
When the scheme was launched, the newly self-employed couldn’t qualify because they hadn’t all filed a 2019/20 tax return. In order to support more self-employed people, those who have filed their 2019/20 tax return will be eligible for the fourth and fifth grants.
You also must be able to prove that you plan to continue trading, or providing a service, beyond the end of the support.
As with the previous grants: your trading profits must be no more than £50,000 and at least half of your total income is from the self-employed profits.
When are the fourth and fifth payments?
The fourth is due in late April and will cover the period from February to April 2021.
The fifth is due in July and will cover the period from May to September 2021.
The fifth payment comes with restrictions based on the loss of turnover felt
How do they calculate the payments?
The calculation of average profits for the grant looks at the last three filed tax returns (or as many as are available). Therefore now looking at 2017/18, 2018/19 and 2019/20.
The fourth grant is 80% (capped at £7,500) but is now based on the average profits from the last three returns submitted.
The fifth and final grant is restricted by a turnover test. Individuals whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, capped at £7,500.
However, people whose turnover has fallen by less than 30% will receive a 30% grant, capped at £2,850.
To apply you’ll need your:
Self Assessment Unique Taxpayer Reference (UTR)
National Insurance number
Government Gateway user ID and password
UK bank details – where a Bacs payment can be accepted.