Fifth Self-Employment Income Support Scheme (SEISS) Grant

The Fifth SEISS grant differs from the previous grants given in that the amount of the grant will be calculated by looking at the reduction in turnover in the year 2020-21 in comparison to turnover before the pandemic.

If HMRC believe you are eligible to claim the grant, they will contact you from mid-July to provide you with a personal claim date.

Eligible customers can apply anytime from their personal claim date until 30‌‌ September‌‌ 2021.

You should only claim the fifth grant if you think that your business profit will be impacted by coronavirus (COVID-19) between 1 May 2021 and 30 September 2021.

 

Eligibility Criteria

1. Your trading status and when you must have traded

You must be a self-employed individual or a member of a partnership. You must also have traded in both tax years:

  • 2019 to 2020
  • 2020 to 2021

You cannot claim the grant if you trade through a limited company or a trust.

2. Tax returns and trading profits

You must have:

  • submitted your 2019 to 2020 tax return on or before 2 March 2021
  • trading profits of no more than £50,000
  • trading profits at least equal to your non-trading income

Non-trading income is any money that you make outside of your business. For example, if you also have a part-time job or pension.

If you’re not eligible based on the trading profits in your 2019 to 2020 return, HMRC will look back at previous years.

3. Deciding if you can claim

When you make your claim, you must tell HMRC that you:

  • intend to keep trading in 2021 to 2022
  • reasonably believe there will be a significant reduction in your trading profits due to the impact of COVID-19 between 1 May 2021 and 30 September 2021

 

How will the claim be calculated?

The amount of the grant will be calculated by looking at how much your turnover has reduced in the year 2020-21 in comparison to your turnover pre-pandemic.

Therefore, if you choose to make a claim, you will need your turnover figures for:

  • a pre-covid year, that represents normal trading. This should be 2019-20 or 2018-19; and
  • your 2020-21 trading year.

Turnover includes the takings, fees, sales or money earned or received by your business.

HMRC will not ask you for any turnover figures if you started trading in 2019 to 2020 and did not trade in the following tax years:

  • 2018 to 2019
  • 2017 to 2018
  • 2016 to 2017

 

How to find your 2019-20 (or 2018-19) turnover

In most cases, your turnover figure will be on your tax return.  Your turnover figure will be in a different box, depending on which tax return and supplementary pages you submitted.

If any of the below apply to you, you will need to take extra steps to tell HMRC your turnover before the pandemic:

  • If you have an accounting period shorter or longer than 12 months: you will need to work out what your 12-month turnover was.
  • If you have more than one business as a sole trader (not trading in a partnership or limited company): your figure must include the total turnover from all your businesses.
  • If you are a member of a partnership and have no other businesses: you will need to use the partnership’s total turnover figure.
  • If you have more than one business, including a partnership: for each partnership, you will need to include your percentage share of the partnership’s turnover. This will be the same as the percentage of profit you took from each partnership in this year. You must add this to the turnover from your other businesses.

For support when calculating turnover, you can check the full guidance by searching ‘SEISS’ on GOV‌‌.UK.

 

How to work out your 2020-21 turnover

You need to work out your turnover for a 12-month period, which must start between 1 April 2020 and 6 April 2020.  Your figure should be as accurate as possible or an honest estimate.

How you calculate your turnover will depend on the records you keep. You may need to:

  • refer to your 2020 to 2021 Self Assessment tax return, if you’ve completed it
  • ask your accountant or tax adviser (if you have one)
  • check the accounting software you use for your business
  • go through your bookkeeping or spreadsheet records that cover your self-employment invoices and payments received
  • check the bank account you use for your business to account for money coming in from customers.

Once you’ve found your figures, you should add them all together to work out your turnover for April 2020 to April 2021.

Coronavirus support payments you received should not be included in your turnover.  This includes, previous SEISS grants; Eat Out to Help Out payments; local authority or devolved administration grants.

If any of the below apply to you, it may change the way you calculate your April 2020 to April 2021 turnover:

  • If you have more than one business as a sole trader: your figure must include the total turnover from all of your businesses. This includes any new business you started between April 2020 and April 2021.
  • If you’re a member of a partnership and have no other businesses: you’ll need to work out the partnership’s total turnover figure.
  • If you have more than one business, including a partnership: for each partnership, you’ll need to include your percentage share of the partnership’s turnover. This will be the same as the percentage of profit you took from each partnership in the 2019-20 (or 2018-19) year you are using for comparison, even if your profit share percentage changed in 2020-21. You should add this to the turnover from your other businesses.
  • If your partnership started between April 2020 to April 2021: you need to work out your share of the turnover slightly differently. It should be the same percentage of profit you took from the partnership in April 2020 to April 2021.
  • If you have Lloyd’s (underwriter) income: if you have Lloyd’s income as well as income from another business, you should use the turnover from your other business. We will not ask you for turnover figures if you only have Lloyd’s income.

 

How much will the grant be

1. If you need to tell HMRC about your turnover

HMRC will work out your grant amount based on how much your turnover is down by after they have compared your 2 turnover figures:

If your turnover is down byYou’ll getMaximum grant amount
30% or more80% of 3 months’ average trading profits£7,500
less than 30%30% of 3 months’ average trading profits£2,850

 

2. If you do not need turnover figures to claim

You will receive 80% of 3 months’ average trading profits.  The maximum grant amount is £7,500.

 

Self Assessment 2020-21

You do not need to submit your 2020-21 Self Assessment tax return at this time, even though HMRC are asking you for your 2020-21 turnover.

The deadline for the 2020-21 Self Assessment tax return is still 31‌‌ January‌‌ 2022.

 

Reporting SEISS grants on your Self Assessment tax returns

SEISS grants are taxable. You need to report any grants you receive on the correct year’s return using the correct box. Grants should not be included in your turnover.

The first, second and third grants must be reported on your tax return for the year in which they were received – in the majority of cases, this will be the 2020-21 tax return to be submitted by 31‌‌ January‌‌ 2022. If, exceptionally, you received your first, second or third SEISS grant payment on or after 6 April 2021, you will need to report this instead on your 2021-22 tax return.

The fourth and fifth grants should be included in your 2021-22 Self Assessment tax returns, which you cannot submit yet.

Published
7th July 2021