Could you be eligible for the Self-Employment Income Support Scheme?
The pandemic has proved to be a tough time for the UK’s freelancers. But there is help at hand still in the form of the Self-Employment Income Support Scheme (SEISS).
The fifth tranche of the SEISS is now available to freelancers, contractors and people running self-employed businesses. If you meet the eligibility criteria, you may be able to claim a grant payment up to the maximum cap of £7,500.
This could be an extremely helpful cash injection for any self-employed workers who have been negatively impacted by the Covid crisis.
How do you know if you’re eligible for SEISS?
The criteria for making a SEISS claim are similar (but not exactly the same) as for the preceding four tranches of the scheme. So it’s important to read the small print and make sure you definitely ARE eligible before you submit a claim.
To be eligible to claim the fifth SEISS grant, you must:
- Have submitted your 2019/20 self-assessment return by 02/03/2021
- Have traded in both the 2019/20 and 2020/21 tax years
- Intend to continue to trade in 2021/22
- Have trading profits that don’t exceed £50,000 and are more than 50% of total income for either:
- the 2019/20 tax year
- an average of 4 years, 2016/17 to 2019/20.
In addition, to be eligible for the fifth tranche, you must reasonably believe there will be a significant reduction in your trading profits due to the impact of COVID-19 between 1 May 2021 and 30 September 2021. Trading profit excludes SEISS and other Covid-19 support grants.
What evidence do you need to submit?
There are a few other conditions which it’s important to note, particularly around the impact that the Covid pandemic has had on your business and profits.
- Unlike previous tranches, you need to submit details of turnover (sales). This will normally be the actual amount included on your 2019/20 tax return, and either an estimated or actual amount that has been/will be included on your 2020/21 return.
- The grant you receive will be based on your profits from self-employment, calculated over the four years from 2016/17 to 2019/20.
- If your turnover has fallen by 30% or more between 2019/20 and 2020/21, the grant is 80% of your average quarterly profits, capped at £7,500. Otherwise it is 30% of average quarterly profits, capped at £2,850.
- The latest date for submitting a claim is 30 September 2021.
NOTE: If you need help working out your turnover, HMRC has included a handy step-by-step walk-through of the process in this guidance.
Talk to us about getting your SEISS information together
If you meet all of the SEISS requirements, it’s a no-brainer to make a claim. Over what’s been a very difficult period, this free cash injection will be a real boost for your cashflow position.
Talk to us if you need help calculating the turnover figures to include in your claim, or deciding whether or not there will be a significant reduction in trading profits for the May-September 2021 period. As with the previous SEISS grants, we’re not allowed to submit the claim on your behalf – you must complete the application and make the claim yourself, as per the SEISS rules.
Get in touch if you need help with your calculations.