The fifth SEISS grant is the final self-employment grant available to help businesses who are struggling due to the COVID-19 pandemic.
With relevant details recently revealed by the UK Government, we wanted to outline what you need to know about the grant, including information on eligibility and when applications for claims will open.
Those who were eligible for the fourth grant should be eligible for the fifth payment.
First and foremost, in order to meet the requirements of the grant, you must be a self-employed individual, or a member of a partnership.
Aside from this, you must have:
Traded in the tax years 2019-20, and submitted your tax return on or before 2 March 2021
Traded in the tax years 2020-21
Be currently trading but impacted by reduced demand due to COVID-19.
Have been trading but are temporarily unable to do so due to COVID-19.
HMRC will look at your 2019-20 self-assessment tax return to work out if you are eligible for the fifth grant. Your trading profits must be no more than £50,000, and at minimum, be equal to your non-trading income. If you are not eligible based on your 2019-20 tax return, HMRC will then look at the other tax years, starting from 2016-17.
If you are not eligible for this particular grant, all is not lost, since you may be entitled to receive financial support via Universal Credit.
HMRC will calculate the amount you are entitled to by looking at how much your turnover has been reduced in the year April 2020 to April 2021.
It is also worth noting that the grant is taxable and is worth either 30% or 80% of your average trading profits for three months.
If your turnover has decreased by 30% or above, the grant will be worth 80% of three months’ average trading profits and the total grant will have a cap of £7,500. Meanwhile, if your turnover has decreased by less than 30%, the grant will be worth 30% of three months’ average trading profits and will have a cap of £2,850.
The government has released a useful guide on how to calculate your turnover.
Applications will be made in the same way as the other grants. That is to say, you should receive a notification from HMRC via email, text message, letter or within the online SEISS portal if you are eligible to apply.
When claiming the fifth SEISS grant, you must declare that you intend to continue trading.
You also need to declare that you reasonably expect there to be a significant reduction in your trading profits due to reduced business activity or inability to trade due to the pandemic in the time frame May to September 2021.
It is helpful to keep evidence that shows how your business has been affected by the pandemic.
The official guidance states you will need the following to make a claim:
Your self-assessment Unique Taxpayer Reference (UTR)
Your National Insurance number
Your Government Gateway user ID and password.
Your UK bank details, including account number, sort code, name on the account and address linked to the account. You should only provide bank details which can accept Bacs payments.
The exact date when people will be able to claim the grant has not yet been clarified. However, the claims window for the last grant is scheduled to open in late July.
The government website says HMRC will contact people from mid-July with their personal claim dates to apply for the grant if it has deemed them eligible based on their tax returns.
Some people have already been contacted, but do not worry if you are yet to hear from HMRC. Claim dates are staggered, so if you have not yet heard anything, you should soon.
If you are planning to make a claim, you will need to do so on or before the 30th September 2021 to ensure that you recieve the grant.
Contact Gow & Partners
If you have any questions regarding the fifth SEISS grant, or need help calculating your turnover, then our dedicated team of accountants would be happy to help. Simply call 01254 589799. Alternatively, you can fill in a contact form, or send us an email at firstname.lastname@example.org.