It has been announced that the portal for applications for the fourth Self-Employment Income Support Scheme (SEISS) Grant, will open on 22 April. Self employed workers have been waiting since February for further guidance about the fourth SEISS Grant, which has been promised since October, but was not confirmed until the 2021 Budget on 3 March.
Late Opening of the Fourth SEISS Grant Portal
A fourth SEISS grant has been expected since October from the Chancellor, to support self-employed workers through disruption to their earnings, due to social restrictions imposed to curb the spread of the virus, that are only just starting to lift. Originally this fourth SEISS grant was expected to arrive in order to support the financial survival of self-employed workers throughout the months of February until April 2021. The 2021 budget announcement confirmed details of a fourth SEISS grant based on 80% of three months’ average trading profits in the tax year 2019-20, which aims to support self-employed workers for the period February- April, which we now know can be claimed between 22 to 29 April 2021. This late opening of the fourth SEISS grant portal has left many self-employed workers waiting for essential income support throughout the period February – April. This fourth SEISS grant delay is also a blow to annual fiscal planning for the self-employed. This latest update to SEISS also failed to take into account parents who declared lower earnings in the eligibility period due to maternity leave. However workers who were newly self-employed from April 2019 do now qualify for SEISS. While eligibility for SEISS has been widened, there’s still no support for the estimated three million self-employed people including freelancers, limited company directors, and the self-employed with more than £50,000 in trading profits.
Incomplete Set of Data
It has been evidenced that some workers waiting in urgent need of the fourth SEISS grant payment, have been logging into the portal early, in the hope that they may have their application processed ahead of schedule. Caution is urged however, since until the fourth SEISS launch date on 19 April, as HMRC “doesn’t have full data in”, and applicants may be misled by incomplete data about their Grant amount and confirmed payment date. Additionally, some self employed workers have so far been confronted with a message to say that they are ineligible, despite none of the reasons stated being applicable to the individual. Once again, this is most likely due to an incomplete set of data within the system before Monday 19 April. Workers are urged to wait until after this date to contact HMRC about their application. If you do need to make an inquiry, you can do so via the helpline on 0800 024 1222, Monday to Friday from 8am to 4pm. Under normal circumstances, workers who have applied previously, and newly eligible workers who have enquired, will be contacted by HMRC with their portal opening date. There is no single, universal date for applications opening. Workers who are eligible for the fourth SEISS Grant will be contacted with their individual portal opening dates in due course, which will fall between 22 – 29 April. When eligible workers have been given their individual application date, they will have until 1 June 2021 to complete their claim online.
How Much to Expect from Fourth SEISS Grant
It has been confirmed that workers who meet the criteria can claim 80% of 3 months average trading profits from the fourth SEISS. It will be paid out in a single instalment and capped at £7,500 in total. How much they receive will depend on average trading profits using up to 4 years’ of submitted tax returns. This may affect the amount you’ll get which could be higher or lower than previous SEISS grant payments. Trading profits from the 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020 tax years will be taken into consideration. For workers who have a gap in the years traded, HMRC will use only your most recent returns after the gap to work out the grant amount.
Eligibility for Fourth SEISS Grant
Guidance on GOV.UK states: “To be eligible for the fourth SEISS grant you must be a self-employed individual or a member of a partnership. You cannot claim the grant if you trade through a limited company or a trust.”
You must have traded in both tax years:
2019-20 and 2020-21
You must either:
Be currently trading but are impacted by reduced demand due to coronavirus
Have been trading but are temporarily unable to do so due to coronavirus
You must also declare that you:
intend to continue to trade
reasonably believe there will be a significant reduction in your trading profits
To make a claim for the fourth grant, a worker will need their:
- Self Assessment Unique Taxpayer Reference (UTR)
- National Insurance number
- Government Gateway user ID and password
- UK bank details including account number, sort code, name on the account and address linked to the account
- As with previous grants, claimants must have been impacted by reduced activity, capacity and demand or been previously trading but are temporarily unable to do so
This applies under the following non-exhaustive list of examples:
- The claimant had fewer customers or clients than they’d normally expect, resulting in reduced activity due to social distancing or Government restrictions
- They had one or more contracts be cancelled and not replaced
- They carried out less work due to supply chain disruptions
- Their business has had to close due to government restrictions
- They have been instructed to shield or self-isolate in-line with NHS guidelines and are unable to work from home
- They have tested positive for coronavirus and are unable to work
- They cannot work due to caring responsibilities, for example as a result of school or childcare facility closures
- HMRC will look at a claimants trading profits and non-trading income on their Self-Assessment tax returns to check if they meet the eligibility criteria for the fourth SEISS grant
A fifth and final SEISS grant was newly announced in the chancellor’s 2021 budget which can be claimed from late July 2021 to cover the period May to September 2021. This grant will be determined by a turnover test. Mr Sunak did not mention the 80 per cent figure when talking about the fifth grant, suggesting that support could be scaled back. The Chancellor said: “Over the course of this crisis we will have spent £33 billion on the self-employed; one of the most generous programmes for self-employed people anywhere in the world.”
Prestige Business Management Works for You
At Prestige Business Management we can help you understand what support is available to you and navigate the application process, so you won’t miss out on what you are entitled to. Find out what we can do for you. Call us today on 0203 773 2927.