The 5th self employment grant (SEISS) will be open for claims from late July 2021! The deadline to claim is 30 September 2021
We’re waiting for more guidance which should be available by the end of June 2021, so do keep an eye on this page.
This is the 5th grant for the self-employed, and you can find out more info on previous grants here.
The rules are different again this time, so make sure you get the details right, as there will be implications if HMRC think you’ve made a fraudulent claim.
Who can claim?
- You must be self-employed, or a partner in a partnership business.
- This grant isn’t available if you’re employed or a director/shareholder of a limited company.
What are the criteria?
1. You must have traded in these 2 tax years:
- 2019/2020
- 2020/2021
2. You must have submitted your 2020 tax return on or before 2 March 2021
3. You must be either:
- currently trading, but experiencing reduced demand due to COVID
- previously trading, but unable to trade at the moment due to COVID
How HMRC work out if you’re eligible
- Your profits must be less than £50,000
- Your profits must also be at least the same amount as your non-trading income
- (put another way, your profits must be at least 50% of your total income)
- HMRC will first look at the 2019/2020 tax year, if you’re not eligible they’ll then look at:
- 2016/2017
- 2017/2018
- 2018/2019
What info you need to make a claim:
This is where it gets tricky.
You’ll need 2 turnover figures for your application:
1. 2020/2021 turnover
Regardless of your financial year, this figure is the 12 months starting between 1 April 2020 and 6 April 2020.
Deduct any COVID grants received
2. The 2nd turnover figure is called the “reference year” turnover
This will usually be for the 2019/2020 tax year, but if you had an unusually low year, take the 2018/2019 turnover.
If you started or ceased trading in 2020 to 2021, include the turnover you received, even if it’s for less than 12 months.
This claim will be much more complicated to work out, and at the moment, HMRC’s guidance is confusing and contradictory, so we’re still hoping for more detail!
If we’re your accountants we can work out your turnover figures ready for you to make a claim, as long as your Xero is up to date.
We will make a charge for this, but it will be a very small proportion of the grant you will receive.
How is the fifth grant different?
This time HMRC will be looking at how much your turnover has been reduced in the 2020/2021 tax year.
We’re expecting more detail towards the end of June 2021, so keep an eye on this page.
What we know now is:
- If your turnover is reduced by over 30%
- you’ll get 80% of your 3months’ average profits
- maximum grant is £7,500
- If your turnover is reduced by less than 30%:
- you’ll get 30% of your 3 months’ average profits
- maximum grant is £2,850
What you need to be aware of when making your claim:
Firstly, your accountant cannot make your claim for you, you must claim yourself, unless you have power of attorney on behalf of someone who can claim.
You will be declaring that:
- you plan to continue trading
- you expect a significant reduction in your profits due to COVID between May and September 2021.
- The significant reduction could be due to reduced:
- business activity
- capacity
- demand
- or not being able to trade at all (temporarily)
When can you claim?
- The online portal should be open by late July 2021.
- HMRC will contact you mid-July 2021 to give you a date to make your claim.
What you can do now
- Make sure your records are completely up to date.
- Include details of all trading income from April 2020 up to date.
- Bookmark the HMRC claim page.
- We can help get you set up on Xero, the most simple to use online accounting software, and show you how to get up to date.
- Check out our COVID19 resource page, which we keep up to date with the latest news.
- Join our FB Small Business Page – we keep this up to date with useful guidance and support, and try to live updates with Government announcements.
- Get in touch if we can help you get your records up to date, or help you to grow your business back out of lockdown.
