The Self-employment Income Support Scheme (SEISS) will provide grant support to self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19.
In his Budget on 3 March 2021, the Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP announced an extension of the UK-wide Self Employment Income Support scheme to September 2021, with 600,000 more people who filed a tax return in 2019-20 now able to claim for the first time.
Yes – individuals will pay Income Tax and National Insurance on any payments received through this scheme as they are replacement for income in line with normal practice for benefits or grants that replace income. The grant is recognised as income for the purposes of Universal Credit and Tax Credits and may impact the amount claimants are entitled to.
In the interim, self-employed individuals may be eligible for universal credit. The government has provided over £6.5bn of additional support through the welfare system for those affected by Coronavirus.
Self-employed individuals who are owner-managers and pay themselves a salary through PAYE will be eligible for support through the Coronavirus Job Retention Scheme (CJRS). SMEs can also access support through the temporary Coronavirus Business Interruption Loan Scheme (CBILS) . This supports SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years, and extension up to 10 under Pay As You Earn.
This new Self-Employment Income Support Scheme is open to anyone who reports trading profits through Income Tax Self-Assessment. Self-employed individuals who work through a company do not report their trading profits in this way.
To be eligible for the fourth grant you must be a self-employed individual or a member of a partnership.
To see if you’re eligible, look at your 2019 to 2020 Self-Assessment Tax Return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.
The grant will be set at 80% of 3 months’ average trading profits, paid out in a single instalment, capped at £7,500. The fourth grant will take into account 2019 to 2020 tax returns and will be open to those who became self-employed in tax year 2019 to 2020. The rest of the eligibility criteria remain unchanged.
Your eligibility for the scheme will now be based on your submitted 2019 to 2020 tax return. This may also affect the amount of the fourth grant which could be higher or lower than previous grants you may have received.
You must also have traded in both tax years:
You must either:
You must also declare that:
Find out if you’re eligible for the fourth grant which will cover the period February 2021 to April 2021.
The online claims service for the fourth grant will be available from late April 2021 until 31 May 2021.
If you are eligible, HMRC will contact you in mid-April to give you your personal claim date. This will be the date that you can make your claim from.
To apply, you will need your:
You may also need to answer questions about your passport, driving licence or information held on your credit file.
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.
The UK Government has announced that there will be a fifth and final grant covering May to September.
You will be able to claim from late July if you are eligible for the fifth grant.
The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021.
The fifth grant will be worth:
This article was written for Saint Financial Group, a multidisciplinary group based in the UK that helps small businesses develop and grow. SaintFG offers a range of quality solutions in supporting businesses. If you need another further guidance or would like to know how we can work with you, get in touch today!
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