The Self Employment Income Support Scheme is available to the self-employed, including members of a partnership, if income has been lost due to coronavirus. You will need to confirm to HMRC that your business has been adversely affected by Coronavirus in order to claim. Your self-employed trading profits must be no more than £50,000 and at least equal to your non-trading income. Three grants have been available under this scheme previously
Eligibility is now based on your 2019/2020 tax return, which must have been filed by 2 March 2020. Importantly, this means that those previously ineligible for the scheme may now be eligible. This will affect the amount of the fifth grant available, as it could result in a higher or lower payment than you may have received under the scheme previously. If you’re not eligible based on your 2019/2020 self assessment tax return, then HMRC will look as far back as the 2017 tax year to determine eligibility.
You must have traded in both 2019/2020 and 2020/21 and intend to continue trading.
The fourth grant will provide a taxable grant calculated at 80% of three month’s average trading profits, capped at £7,500. This will cover the period February to April 2021. Claims are now open. If you’re eligible, HMRC will contact you in mid-April to give you a claim date. Claims close on 1 June 2021.
The fifth and final grant covers the period May to September, and is available from late July. A grant based on 80% of average monthly trading profits will be available to those that can prove their turnover has fallen by more than 30%. If turnover has fallen by under 30% then a grant will be available covering a significantly lower amount of 30% of average monthly trading profits.
To qualify for the fifth grant, your business must have had a new or continuing impact from coronavirus between 1 May 2021 and 30 September 2021, which you reasonably believe will have a significant reduction in your profits due to reduced business activity, capacity, demand or inability to trade due to COVID. Evidence must be kept to support your claim. The other qualifying criteria is the same as previously, so self-employed trading profits must be no more than £50,000 and at least equal to any non-trading income.
If you qualify based on the above criteria then the actual calculation of the grant is calculated in a different way to the previous four grants. In order to claim, you will need two different turnover figures:
1. Turnover between either 1 April 2020 to 31 March 2021 or 6 April 2020 to 5 April 2021.
2. Turnover reported on your 2019/2020 tax return.
If your turnover has dropped by more than 30% then you will qualify for the full 80% grant as previously (capped at £7,500), but if your turnover has dropped by less than 30% then you will only be eligible for a much reduced 30% grant (capped at £2,850).
Specific details on how to calculate turnover are on HMRC’s website: https://www.gov.uk/guidance/work-out-your-turnover-so-you-can-claim-the-fifth-seiss-grant
Claims open in late July and close on the 30 September 2021. HMRC will write to those who are eligible based on their tax returns from mid-July, with an invitation to apply online and a date that this application can be made.
