The self-employed income support scheme (SEISS) grant, introduced by the government to help businesses through the coronavirus pandemic, is open for applications again.
This grant can award businesses up to £7,500.
However, businesses may have to submit two turnover figures to successfully apply.
How do you apply?
HMRC has either emailed or sent a letter to every self-employed taxpayer who may be able to apply for the grant. This gives the business a personal start date from which they can apply. Applying before the start date will invalidate the application and it will not be processed.
Different start dates have been given to businesses to reduce the number of crashes the government website experiences.
The first day of application was the 29th July and will remain open until 30 September 2021.
What makes a business eligible?
HMRC has already conducted a basic check for eligibility within the 2019/20 tax return, submitted by 2 March 2021.
Within the tax return, the taxpayer must have made a declaration that they intend to keep trading in 2021/22. They must also have declared profits will sustain a ‘significant reduction’ between 1 May 2021 and 30 September 2021 due to the pandemic.
While HMRC have not elaborated on the meaning of ‘significant’, the taxpayer is only required provide a forecast for profits in the period ending 30 September 2021. The forecast provided will not be re-examined after September 30th.
However, businesses will need to keep any evidence of why they believed profits were going to be negatively impacted due to covid-19.
Do not worry if you were too late to apply for the SEISS-4 grant. If you were eligible, you will still be able to apply for the SEISS-5 grant, so long as the other conditions are fulfilled.
What turnover data do you need to submit?
Most taxpayers applying will now need to submit two different turnover figures. These figures will be the 12-month turnover between April 2020/21, and, in most cases, the turnover figure for April 2019/20 as a reference point.
New businesses who started trading in 2019/20 and did not have a self-employed trade between the years 2016/17 to 2018/19, do not have to provide any turnover figures. HMRC already has the figure for 2019/20 via their tax return.
These businesses will receive the higher-level grant, awarding them 80% average trading profits across 3 months.
Some argue that turnover does not accurately measure the ‘significant losses’ incurred to the business due to the pandemic. Other factors like deferred loan repayments and staff redundancies might mean the business is worse off despite a stable turnover.
[Article written 8th Aug, 2021]