⚠️ This is a news story and may not be up to date. You can find the date it was published under the title. Our Tax Guides feature the latest up-to-date tax information and guidance.
How to claim a grant under the Self-Employment Income Support Scheme (SEISS)
⚠️ Since the publication of this news article it has been confirmed that the closing date for making a claim for the first SEISS grant is 13 July. we now understand that the grant will be treated as taxable income in the year of receipt, so in the 2020/21 tax year. More guidance confirming the tax treatment of the SEISS payment will be issued by HMRC shortly and we will then write a new article explaining the tax and National Insurance treatment of the SEISS grant.
This article explains how you can check if you are eligible for SEISS and how you can obtain the grant.
We explain what the SEISS grant is, including who can claim it, how it is calculated and how it affects tax credits and universal credit on our page: Coronavirus: Self-Employment Income Support Scheme and so this is not covered below.
Be careful of any emails, letters or SMS messages you may receive containing links or asking for your bank details- these are highly likely to be fraudulent. Although HMRC may contact you by email or SMS messages these will NOT contain any links and will not be asking you for personal information such as bank account details. Personal information will only be required once you are logged on to HMRC’s secure system on GOV.UK (which we explain about below).
HMRC are using information based on your 2016/17, 2017/18 and 2018/19 tax returns to identify self-employed individuals or partners in a partnership, who they think may be eligible to claim the SEISS. HMRC will contact these people directly with instructions on how to make a claim.
The eligibility criteria for the SEISS grant is explained on our webpage.
If you trade as part of a partnership then each individual partner will need to check their own eligibility for the SEISS grant. This is because eligibility will depend on each partner’s personal circumstances, as illustrated in this example on GOV.UK.
It is possible that HMRC will contact you to invite you to check your eligibility and/or claim the SEISS but you do not meet all of the criteria. This is because HMRC only hold information about some of the eligibility conditions. This may happen where you meet the criteria based on information on your 2016/17, 2017/18, 2018/19 tax returns but subsequently there have been changes to your business circumstances which mean that you do not qualify for the SEISS. For example:
- You incorporated your business (so began trading as a company) after the 2018/19 tax year and so are no longer trading as a sole-trader, you will be classed as an employee and not self-employed in 2019/20. (see our article: I'm a director for my own limited company: what support is there for me?).
- You stopped trading on a self-employed basis or as a member of a partnership after the end of the 2018/19 tax year
- Your trading income has not been adversely affected because of the Coronavirus (COVID-19) outbreak
If HMRC have contacted you to say you are eligible for the SEISS grant but you do not meet all the conditions to claim the grant then you should not make a claim.
You will not be able to make a claim until mid-May but there are certain steps you can do now to check you have all the information you need to make the claim so you are ready when the online application process becomes available.
GOV.UK has an online checker which you can use to confirm your eligibility (bearing in mind that not all the criteria will be covered by this checker so it is your responsibility to be sure that you meet all the eligibility criteria). To use the online checker make sure you have your
UTR (Unique taxpayer reference), you can usually find this on correspondence received from HMRC, on your tax return, and when you log into your Personal Tax Account.
National Insurance Number (NINO), this may be on correspondence received from HMRC, on your tax return, and other documents such as payslips (if you have been an employed previously) or on your Personal Tax Account.
If you are eligible for the SEISS grant you will be invited to make the claim after the date and time you are told about on the online checker. Be aware, that in some cases the eligibility checker might show you are eligible to claim, even if you don’t meet all of the qualifying conditions.
You will then be asked for your contact details to be provided so HMRC can get in touch with you about the actual claim, through the Government Gateway system (see below).
If the online checker states you are not eligible to make a claim but you consider that you are then you can ask HMRC to review your eligibility (you will have an opportunity to do this after you have completed the online checker process).
What do you need to do to make a claim?
As explained above, HMRC will contact you if they think you will be eligible for the grant and will invite you to make a claim on GOV.UK via the Government Gateway system. This will be the most efficient way to get the grant payment and so it is best to use the online system to make the claim unless you are unable to do so.
You may already be registered for Government Gateway, if you aren’t then you will need to register, you will be able to register after completing the online eligibility checker. You used to have to wait for an Activation Code (a security measure) to arrive in the post. HMRC have suspended this step for now to help speed up the process.
If you already have a Government Gateway but have lost or forgotten the details, then you can recover your sign in details after completing the online eligibility checker.
The SEISS online claim system will be available 24 hours a day, seven days a week. It is designed to be an easy to use, self-service, system with guidance in place to help you navigate it.
If you are unable to claim online then an alternative way of claiming will be available shortly, and the details of how to do this will be added to GOV.UK once the method is finalised. If you need extra support with the SEISS now then you can obtain general help with the scheme from HMRC.
You may use a tax agent to prepare and file your Self Assessment tax return, if this is the case then be aware that your tax agent cannot submit a claim for the SEISS grant on your behalf. However, they should be able to help you with the information you need for the online checker (explained above), if required.
How to make a claim
You will be unable to make a claim before the date and time given to you by the online checker. The claims system will open from 13 May 2020.
When you can make a claim, you should log on to the Government Gateway system where it will confirm your eligibility.
The SEISS grant is taxable and subject to Class 4 National Insurance so will need to be included in your Self Assessment tax return(s). Depending on which accounting basis you use (cash basis or the accruals basis) and your accounting year-end, the grant may need to be apportioned between your 2019/20 and 2020/21 tax returns.
Before continuing with your claim you need to confirm that you:
- traded during the 2019/20 tax year as self-employed or a partner in a partnership; and
- are planning to continue to trade during the 2020/21 as self-employed or a partner in a partnership; and
- your business has been adversely affected by the coronavirus outbreak. Adversely affected includes not being able to work because you have caring responsibilities, you are self-isolating or your trade has reduced because, for example, you are unable to open your premises, see customers, or obtain stock etc.
It is important that you keep records of why you have been eligible to claim the SEISS grant– so make a note of why your trade has declined during the coronavirus outbreak as HMRC will check your grant claim later (after you have received it).
There are additional criteria if you live overseas or use the remittance basis.
You will also need to provide details for the bank account where you would like the grant to be paid into. You do not need to request that the grant is paid in to your business bank account (if you have one), it can be paid into your personal account just remember that it is business income and needs to be included on your tax return in due course.
How much will I receive under the SEISS?
HMRC calculates the amount of the grant which you can claim. The SEISS provides support for three months 1 March to 31 May, we explain how it is calculated on our SEISS webpage and there are examples on GOV.UK. If you do think the grant has been calculated incorrectly then you can contact HMRC.
When you make a claim for the SEISS, HMRC will provide you with a calculation of the grant and what information they have used. Remember to print off or take a screen-shot of this page as this will help you check the figures if you don’t immediately understand the calculation and you will need it when you prepare your tax return(s).
After making the claim
HMRC will confirm immediately if your claim has been accepted. It is advisable to print or screen-shot any screens with a scheme reference and confirmation of your submitted claim. Claims should be paid within 6 working days.
Contact: Claire Thackaberry (click here to Contact Us)
(First published: 07-05-20)