The Chancellor has announced an extension to the existing Self-Employment Income Support Scheme (SEISS). The scheme will be extended – with those eligible able to claim a second and final grant capped at £6,570
Individuals can continue to apply for the first SEISS grant until 13 July. Under the first grant, eligible individuals can claim a taxable grant worth 80% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total. Those eligible have the money paid into their bank account within six working days of completing a claim.
Applications for the second grant will open in August. Individuals will be able to claim a second taxable grant worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
The eligibility criteria are the same for both grants, and individuals will need to confirm that their business has been adversely affected by the coronavirus. An individual does not need to have claimed the first grant to receive the second grant: for example, they may only have been adversely affected by COVID-19 in this later phase.
Eligibility criteria for making a claim are:
Self-employed individuals, including members of partnerships, are eligible if they:
• submitted their Income Tax Self-Assessment tax return for the tax year 2018-19;
• continued to trade in 2019-20 and intend to keep trading in 2020-21;
• carry on a trade which has been adversely affected by COVID-19;
• have average self-employed trading profits of no more than £50,000 and equal at least to their non-trading income.
Individuals can continue to work, start a new trade or take on other employment, including voluntary work, or duties as an armed forces reservist.
As a recap, first applications for the initial grant are now live and can be claimed if, eligible. If you are self-employed or a member of a partnership and your business has been adversely affected by the coronavirus, you could be eligible to claim this grant which is paid out in a single instalment covering three months and capped at £7,500 altogether.
Price Bailey, as is the case with all tax agents, will not have access to this system, despite being nominated as your appointed agent with HMRC. The system has been designed to be straight forward and, to avoid any delays in the roll-out, access has been restricted to individual taxpayers who will have to make their own claims.
The following is an overview of the requirements to claim if you are eligible.
So what do I need to do now?
HMRC has sent emails, SMS text messages and letters to taxpayers who they think may be eligible to make a claim, based on information they already hold, from tax returns that have been submitted.
HMRC has an eligibility checker tool, and we recommend that you check your position now to see whether HMRC believes you are eligible for a grant. We can assist you with this check if you wish, or review your situation should the result suggest you are ineligible. Please get in touch with your usual Price Bailey contact who will be able to advise you further.
The checker says I’m eligible, so how do I apply?
You will need to have the following information to hand when making your claim:
• your Self-assessment UTR;
• your National Insurance Number;
• Government Gateway User ID and password (if already set up), but see below if not;
• Bank account number and sort code for the grant to be paid into;
You need to login to your Government Gateway account (or select the option to create an account, if you don’t have one set up already) to complete the application process. You will be presented with your claim details and be asked to:
• read and accept the eligibility criteria:
• complete the declarations, including that your business has been adversely affected by the coronavirus; and
• supply the bank account details into which you would like the grant paid.
You do not need to provide any other information as the calculations are all done by HMRC based on information provided on your submitted tax returns.
Then what happens?
HMRC will check the claim and have advised they expect to make payments within six working days of your application being made, whichever is later.
The process for disputing the amount of the grant is not yet known. We would recommend contacting us if you have been deemed ineligible or believe your grant may be incorrect.
HMRC has a detailed page which can be found here, or you can get in touch with your usual Price Bailey contact who will happily deal with any questions you may have.
The above is based on information published by HMRC as of 29 May 2020 and may be subject to change. Further guidance on the second grant will be published on Friday 12 June.
This blog was written by Tony Pennison, a Partner at Price Bailey. For more information or to contact Tony, please use the form below.
We always recommend that you seek advice from a suitably qualified adviser before taking any action. The information in this article only serves as a guide and no responsibility for loss occasioned by any person acting or refraining from action as a result of this material can be accepted by the authors or the firm.