Self-Employed Income Support Scheme
On 21st April 2021, the claim window opened for the fourth grant.
However, individuals who are eligible to claim only have until 1st June 2021 to apply for the grant!
- Background Information
- The Fourth Grant
- The Fifth Grant
- Who is Eligible?
- How is the Grant Calculated
- Previous SEISS Grants
- HMRC Online Tool Kit
Background Information
The government’s support scheme for the self-employed – the Coronavirus Self-Employed Income Support Scheme (SEISS) was put into place to offers taxable grants for many sole traders and partnerships.
The scope of SEISS was extended to help the newly self-employed who missed out on the previous grants.
As announced in the March 2021 Budget the existing scheme has been extended to include both a fourth and a fifth round of support. This will be the first opportunity for over 600,000 recent self-starters to make a claim, as 2019/20 tax returns will now be included in the grant calculation.
The Fourth Grant
The fourth SEISS grant is available to individuals who began self-employment during the 2019/20 tax year as well as those who have previously claimed. The 2019/20 tax year covers the period from 6th April 2019 up to 5th April 2020.
The fourth SEISS grant covers the period February to April 2021. Individuals who are eligible will be able to claim the fourth round of SEISS at 80% of average trading profits capped at £7,500 for three months.
If you think that you may be eligible then you must act fast. The fourth grant is only available until 1st June 2021.
The Fifth Grant
The government have announced that there will be a fifth and final grant to cover May to September 2021. This is likely to be available in late July. The amount you receive will depend on how badly your business has been affected.
If your self-employed business turnover has fallen by 30% or more, as with previous grants you will receive 80% of 3 months’ average trading profits, capped at £7,500.
If your turnover has not been as severely affected and the reduction is less than 30%, you will only receive 30% of 3 months’ average trading profits, capped at £2,850.
Who is Eligible?
To be eligible for the fourth grant, and for new entrants to the scheme, you must have filed a Self-Assessment tax return for the 2019/20 tax year by midnight on 2nd March 2021.
All other eligibility criteria will remain the same as the third grant.
Firstly, you must be a self-employed individual or a member of a partnership.
You must also have traded in both the 2019/20 and 2020/21 tax years and submitted your 2019/20 tax return by 2nd March 2021.
You must either:
- be currently trading but are impacted by reduced demand due to coronavirus; or
- have been trading but are temporarily unable to do so due to coronavirus
You must also declare that:
- you intend to continue to trade; and
- you reasonably believe there will be a significant reduction in your trading profits due to reduced business activity, capacity, demand or inability to trade due to coronavirus
How is the Grant Calculated
HMRC will first look at your Self-Assessment tax return for the 2019/20 tax year.
Your trading profits must be no more than £50,000 and at least equal to your non-trading income.
If you are not eligible based on your 2019/20 Self-Assessment tax return, HMRC will then look at the tax years 2016/17, 2017/18, 2018/19 and 2019/20.
Applications for the fourth grant are open from 21st April to 1st June 2021.
Previous SEISS Grants
The first grant – A grant of up to 80% of your average monthly trading profits capped at £7,500. This closed on 13th July 2020.
The second grant – A grant covering up to 70% of your average monthly trading profits, capped at £6,750. This closed on 19th October 2020.
The third grant – A grant covering 80% of your average monthly trading profits capped at £7,500. This closed on 29th January 2021.
HMRC Online Toolkits
HMRC have provided an online tool to check if you’re eligible.
If you received the first three grants you are likely to be eligible for the fourth and fifth grant if your business continues to be affected.
The government has an online portal for making a claim.
You must make a claim yourself – Tax Agents or Advisors cannot make a claim on your behalf.
How Onyx Accountants can help you?
We are unable to make the claim for you. However we can review your previously submitted tax returns and advise on how much of the grant you should be entitled to. We can advise on fund management and how to make the best use of your grant once received.
By planning ahead we can monitor your business performance as it emerges from the numerous lockdowns, and restricted business activity. Helping your business get back on track.
We would recommend completing your next tax return early, so you know how much tax you need to pay and by when. It also makes perfect sense if you are due a refund. We want to make sure that any refunds due are received as soon as possible. We can also advise on how best to make provision for any additional tax payments due by 31st January 2022.
By using Onyx Accountants and Business Advisors to undertake a review of the SEISS grants along with your self-assessment tax return, you eliminate the worry which allows you to concentrate on running your business.
GET IN TOUCH WITH ONYX
If you have any queries, or want to discuss further, please give us a call; or e-mail us at enquiries@onyx.accountants for a FREE no obligation consultation.
Got any questions or queries? Our friendly team of tax specialists are happy to help. Just drop us a line! Call us on 0121 753 5522 or 01902 759 800.
