SEISS: How to apply for the self-employment grant

If you’re self-employed and have been affected by the pandemic, you may be eligible to claim a grant though the Self-Employment Income Support Scheme (SEISS). The scheme first opened in May 2020 and was worth 80% of past average monthly trading profits for those eligible. Since then, a second grant worth 70% was opened in August and closed for applications on 19 October and a third SEISS grant, worth 80%, was opened to claim on or before 29 January. The fourth SEISS grant will cover the three-month period from the start of February until the end of April but the application process and eligibility requirements have now changed compared to previous SEISS payments.

How the fourth grant is different 

HMRC is not planning on announcing a formal opening date for when applications can be made and instead will be contacting those eligible through either email, letter or within the GOV.UK online service. We’ve already seen reports that some have already been able to access their SEISS 4 grant date by logging in to the Self-Assessment Unique Taxpayer Reference page on Gov.UK. This link should go live from Monday, 19 April and you should be able to view your own unique date for applying if considered eligible.

Once you have received or accessed your own unique application date, you will have until June 1, 2021 to complete the claim for SEISS grant 4.

To be considered eligible for the fourth grant, you must have filed a 2019/20 tax return before the 2nd March, earned most of your income though trading, and have average trading profits of less than £50,000.

HMRC has reiterated to us that they will first base eligibility on the 2019/20 Self-Assessment tax return and then, if not eligible, look at the tax years 2016/17, 2017/18, 2018/19 as well as 2019/20, where applicable.

If successfully claimed, the grant will provide 80% cover of 3 months’ average trading profits and be paid as a single, taxable instalment and capped at a total of £7,500.

Fourth SEISS grant claim process

1. Check for your eligibility for the SEISS grant

Like SEISS 3, SEISS 4 requires your business to either be impacted by “reduced demand” or be “unable to trade” due to coronavirus in the qualifying period for SEISS 3 (Feb 1 - 30 April 2021). Second, you “must decide if the impact on your business will cause a significant reduction in your trading profits for the tax year you report them in”. In other words, not only do you have to have evidence of reduced demand or inability to trade for the period Feb – April; you also need to have a ‘reasonable belief’ that this means your profits will be lower than they otherwise would have been for the whole tax year you report in.

Unfortunately, HMRC has provided no clear definition of what constitutes a “significant reduction” in trading profit. HMRC says it cannot make this decision for a business because individual and wider business circumstances will need to be considered (it has published some examples online here) and you will need to make an “honest assessment”.

2. Gather evidence for your SEISS claim

In order to submit a claim, you must show that the coronavirus pandemic and concurrent lockdown has had a negative impact on your business.

As noted above, you must declare that your business has been impacted by reduced demand due to COVID-19 in the qualifying period (Feb - April) and you must reasonably believe that this has led to a significant reduction in your trading profits for the tax year as a whole.

As such, it is worth keeping some evidence of the impact Covid-19 has had on your business.

To show you have experienced reduced demand, examples of evidence include:

  • business accounts showing reduction in activity compared to previous years
  • records of reduced or cancelled contracts or appointments
  • fewer invoices
  • a record of dates where you had reduced demand or capacity due to government restrictions

If your business is temporarily unable to trade, you should keep any evidence such as:

  • a record of dates where you had to close due to government restrictions
  • NHS Test and Trace communications - if you’ve been instructed to self-isolate in-line with NHS guidelines and are unable to work from home (if you’ve been abroad and have to self-isolate, this does not count)
  • a letter or email from the NHS asking you to shield
  • test results if you’ve been diagnosed with coronavirus
  • letters or emails from your child’s school if you have had parental caring responsibilities

3. Make your SEISS claim

You must submit a claim yourself rather than have someone submit one on your behalf. To apply, you will need:

  • Your Self-Assessment Unique Taxpayer Reference (UTR)
  • Your National Insurance number
  • Your Government Gateway user ID and password – if you do not have an existing user ID you can create one when you claim
  • Your UK bank details including a bank account number, sort code, name on the account and your address linked to your bank account

If you are still unsure about claiming, then you can read the GOV.UK SEISS guidance in full here.

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