UPDATE: 31 OCTOBER 2020
No updates yet on the 3rd self-employment income support scheme (SEISS)
- This is currently 40% of your average profits, for the 3 months from 1 November 2020
- There should be a 4th grant due for the 3 months from 1 February 2021
- We are hoping for a review of this support now that there is a new lockdown
May HMRC started contacting individuals and businesses concerning the above scheme to let them know how to make a claim under the Self-Employed Income Support Scheme if they consider themselves to be eligible.
Being contacted does not necessarily mean that you will receive funds as it is down to you to check you are eligible and make a claim. Your tax adviser or agent is unable to make the claim for you so it is important to take action now.
What is available?
If you are eligible, the grant will be 80% of your average annual trading profit for the previous three years pro-rated over the months claimed, with payments capped at £2,500 a month. The sum paid is taxable, but as it’s a grant, it means you don't have to pay it back until after the crisis has passed.
Who is eligible?
To be eligible for the scheme you must have been self-employed prior to 6 April 2019 and have submitted a tax return for the year 2018/19. The deadline for filing a 2018/19 tax return in order to qualify for the scheme was Thursday 23 April. Even if you only had a few months' self-employment on your 2018/19 return, this will be counted as your total profit for the year. Missing the 23 April deadline extension will, unfortunately, mean that a self-employed person is ineligible for the SEISS.
However, if you earned more than £50,000 (or earned less than half of your income from self-employment) in 2018/19, the Government will then check your 2016/17 and 2017/18 tax returns, if you filed them for those years. If on average over the three years you earned less than £50,000 and made more than half your income from self-employment, you'll still be eligible.
When looking at what your total income has been, HMRC will take into account the following:
What do you need to do?
- Income from earnings
- Trading profits
- Property income
- Savings income
- Pension income
- Miscellaneous income
There are 2 steps to take to make a claim under the SEISS:
- Check eligibility
You can follow the link below to check with you are eligible to receive funds. To do this you will need to have:
- Your Unique Tax Payer Reference (UTR) number
- Your National Insurance number
If you are eligible, this link will then tell you the date you will be able to make a claim, which will be after the portal goes live on 13 May 2020.
If you are not eligible to make a claim, you can ask HMRC to review.
- Make a claim
HMRC will calculate the amount of the grant but you will still need to make a claim online, or via telephone. If you are unable to access the internet we anticipate that there will be long wait times to get through to an adviser.
To make a claim you will need to have the following information to hand:
- UTR number
- National Insurance number
- Government gateway and password (if you do not already have one of these, it can be done as part of the claim process but it would be a good idea to do this in advance so that there is no delay to funds being received)
- The sort code and account number of the bank account that you would like the amount paid into.
- You will also need to confirm that you have been adversely affected by Covid-19
You will not be required to calculate the amount of the claim yourself, HMRC will do this from the information they have available to them. However, it is important to keep a record of the amount claimed, the claim reference you will be given and evidence that you have been affected by the virus as HMRC may contact you in the future.
Any amount you received under the SEISS will need to be reported on your Self-Assessment Tax Return for 20/21.
It is also important to be vigilant in spotting potential scams in relation to your claim. If you receive emails or texts asking you to click on links or reply, do not do them and do not supply your bank account details to anyone, other than when making a claim through the HMRC website.