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Self-Employment Income Support Scheme: What’s new?

Published on 17 August 2020

From today, 17 August 2020, self-employed individuals are able to make a claim for the second grant under the Self-Employment Income Support Scheme (SEISS). In addition, certain individuals who did not originally qualify for the first grant because of pregnancy or becoming responsible for a new child, or because they were military reservist, are now able to claim both the first and second grants.

self employed writing in a book in a colourful office
(c) Shutterstock / Aysezgicmeli

What is the Self-Employment Income Support Scheme?

The Self-Employment Income Support Scheme (SEISS) is designed to provide support for self-employed individuals whose businesses have been adversely affected as a result of the coronavirus pandemic. The government is providing up to two taxable grants, worth together up to £14,070, to those who meet the eligibility conditions.

For detailed guidance, see Coronavirus: Self-Employment Income Support Scheme.

How much is the second grant?

The second grant will be calculated using the same average monthly profits as the first grant.

However, while the first grant multiplied your average monthly profits by 80% (capped at £7,500 for three months), the second grant will be based on 70% of your average monthly profits (capped at £6,570).

See What will I receive from the second SEISS grant? or more information and a worked example.

I already claimed the first grant on or before 13 July 2020. What do I have to do?

HMRC should contact you directly, either by email or otherwise by letter, to invite you to make a claim for the second grant. You will be provided with a date from which you will be able to make the claim. You will need to make the claim by 19 October 2020.

If you met the eligibility conditions for the first grant, you will not automatically be entitled to the second grant, even if HMRC invite you to make a claim. You will need to confirm that:

  • Your business has been adversely affected by coronavirus on or after 14 July 2020; and
  • You still intend to continue trading for at least part of the remainder of the current tax year (ending 5 April 2021).

You will need to assess the above two conditions at the point you make the claim.

You should make the claim through GOV.UK. If you are unable to claim online for any reason, or you need extra support, you should contact HMRC.

I didn’t claim the first grant. Will I be eligible for the second grant?

There is no requirement to claim the first grant in order to be eligible for the second grant.

You will need to consider your eligibility for the second grant separately. However, some eligibility conditions are common to both grants. If you were not eligible for the first grant because of one of these common conditions, for example you did not submit the relevant tax return by 23 April 2020, you will not be eligible for the second grant either.

If HMRC rejected your claim for the first grant and you requested a review, the result of which was that you were not eligible, you will not be able to request a review for your eligibility for the second grant.

For details, see Who is eligible for SEISS?.

My profits in 2018/19 were affected because of pregnancy or becoming responsible for a new child. What should I do?

You should read our guidance: Self-employment support scheme ‘parental’ extension: who does it help? to understand whether you might be able to claim either grant under the extended rules.

Note that the extended rules do not affect those who could already claim a grant under the original rules, even if the amount of the grant was reduced because of pregnancy or certain parental responsibilities.

If the extended rules apply to you, you will need to ask HMRC to verify certain information which demonstrates this is the case. You should do this by 5 October 2020 if possible, to allow HMRC enough time to verify the information before the scheme closes on 19 October 2020. It is possible to ask HMRC for a review (by calling the helpline) if they do not accept you meet the requirements based on the information provided.

As part of this process, HMRC will check whether or not you are eligibility for the SEISS grants based on tax return information they already hold (that is, whether or not you meet the profits test based on 2017/18 only, or 2016/17 and 2017/18, and you submitted a tax return for 2017/18 by 23 April 2020).

If HMRC agree you can proceed to claim, they will let you know the date from which you can do so and you should claim through GOV.UK provided you meet the remaining eligibility conditions for the grant you are claiming.

I was a military reservist in 2018/19. Am I eligible for the grants under the extended rules?

If you were not originally eligible for the SEISS grant, you may be eligible to claim one or both grants from 17 August 2020 if you fall within extended rules for this group. Your trading profits or total income in 2018/19 will need to have been affected such that you did not qualify for the grant under the original rules because of your service pay or certain reservist activities. See GOV.UK for the detail.

We understand that HMRC will be writing to those they believe may be in scope of the extended rules for military reservists, based on Ministry of Defence and Self Assessment records. However, note that:

  • If you receive such a letter from HMRC, you will still need to make sure you meet all the eligibility conditions in order to make a claim.
  • If you do not receive such a letter, it does not necessarily mean that you are not eligible.

On the basis that you meet the remaining eligibility conditions for the grants you are claiming (see immediately below), you should make the claim through GOV.UK or contact HMRC if you are unable to claim online.

I fall under the extended rules for new parents or military reservists. Which grants am I eligible for?

Provided that:

  • you continued to trade in 2018/19 and 2019/20; and
  • you currently trade (or would be were it not for coronavirus) and you intend to continue trading for at least part of the remainder of the current tax year ending 5 April 2021 (or would do were it not for coronavirus),

you will be able to one or both grants as follows:

Your business was adversely affected on or before 13 July 2020 Your business has been adversely affected on or after 14 July 2020 SEISS grants you will be able to claim

Yes

No

The first grant only

No

Yes

The second grant only

Yes

Yes

Both grants

No

No

Neither grant


You will be able to claim the grants you are eligible for between 17 August 2020 and 19 October 2020.

What other exceptions are there?

Apart from the extended rules for new parents and military reservists, there are other exceptions to the normal rules for the scheme. These include the cases where:

  • You are subject to the loan charge
  • You are non-resident in the UK
  • You claim the remittance basis.

See GOV.UK for more detail.

Where can I get more help?

If you have further questions, we suggest you read our main guidance on the scheme.

You can also refer to GOV.UK.

If you need to speak to someone, you can contact HMRC through webchat or by phone.

TaxAid also run a specialist helpline for the Self-Employment Income Support Scheme (0345 120 3779, Monday to Friday, 9am to 5pm).

Contact: Tom Henderson (click here to Contact Us)
(First published: 17/08/20)

 

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