Please see our blog below for details of claiming the last Self-Employed Income Support Scheme (SEISS) grant. We have also provided additional details for clients for whom we act as accountants, so that we can ensure any grant payments received are included in your upcoming tax return.
Changes in eligibility criteria
The eligibility criteria remain broadly the same as the fourth grant. Self-employed profits in 2019/20 must not exceed £50,000 and must be more than 50% of your total income. If that test is not met, and if you’re not eligible based on the trading profits in your 2019 to 2020 return, HMRC will look back at previous years.
However, for previous SEISS grants, HMRC have looked at an average of previous years’ trading profits – for the fifth grant they will look at 2019/20, then compare to profits for 2020/21. If they cannot compare for 2019/20 they will look at an earlier year to identify normal profits. Where the eligibility criteria for the fifth grant slightly differs from the previous grants, is that this grant will be calculated based upon the reduction in your turnover during the year April 2020 - April 2021. The amount receivable will be determined as follows:
- If turnover has reduced by 30% or more you will receive 80% of 3 months average trading profits up to a maximum of £7,500.
- If turnover has reduced less than 30% then you will receive 30% of the 3 months average trading profits up to a maximum of £2,850.
Please remember – your accountant (or tax agent) cannot claim the SEISS on your behalf.
What are the conditions for claiming SEISS?
The conditions for claiming the fifth SEISS grant are as follows:
- You must be Self Employed or a member of a partnership
- You must have traded in the tax years 2019-20 and submitted a tax return before 2 March 2021
- You must have also traded in the tax year 2020 to 2021
- You must be currently trading but have been impacted by reduced demand due to coronavirus
- Have been trading but are temporarily unable to do so due to coronavirus
- Your trading profits must be less than £50,000 and at least equal to your non-trading income
What if I have not claimed before?
Self-employed traders need not have claimed grants under the previous scheme to qualify for the July payment and will be required to confirm that their business continues to be adversely affected by Covid-19. The amount that traders will be able to claim will depend on how much their turnover has reduced by
Declaration to HMRC
A declaration must be made to HMRC stating that you intend to continue to trade and that you reasonably believe that there will be a significant reduction in trading profits due to reduced business activity, capacity, demand or inability to trade due to coronavirus from May 2021 to September 2021.
Preparation for your next tax return
As you are probably aware tax agents like LWA were not able to claim SEISS grants on their client’s behalf, and we do not currently have access to the amounts you have claimed.
If you are self-employed and have received any SEISS grants in 2020/21 can you please let us have details of the amounts received so that we can include the correct amounts in your return. The amounts received are taxable but should not be included in your turnover as that would mean double counting.
If you have any queries about claiming the SEISS grant or about your upcoming tax return, or if you need advice on any personal tax matters, contact a member of our helpful team in Manchester on 0161 905 1801 or in Warrington on 01925 830 830 – we’re here to help.